The recent Strategic Insights paper Security through aid by Anthony Bergin and Sarah Hately on the use of aid and development assistance to enhance security gives attention to important but currently neglected opportunities to counter violent extremism. Those opportunities can be broadly conceptualised as positive and negative: positive building of resilience and negating the potential misuses of aid. In this post, I will focus on lessons to be learned from environmental management which could be applied to negating the misuse of aid and development assistance in a security context.
The well-established practice of environmental impact assessment (EIA) is a model that informs the design of a counterterrorism filter for aid programs. The US Congress enacted its National Environment Protection Act in 1970 and this quickly became a global model. In Australia, Victoria enacted its Environment Protection Act in 1970, and the Commonwealth enacted its Environment Protection (Impact of Proposals) Act in 1974. The central mechanism in each of those environment protection laws (and their similes and successors) is a requirement for EIA of negative impacts of proposed major developments on the environment.
Almost all major industrial, agricultural, civil engineering or building construction proposals require government permits. Pursuant to the environment protection laws, the issuance of permits must take into consideration a prior assessment of negative environmental impacts. EIA categories of significant negative impacts have been developed, such as impacts on threatened species or World Heritage. The responsible authorities may impose conditions in the permit that require the amelioration of identified negative environmental impacts from the proposed development. Development proponents are made responsible for conduct of the EIA, subject to governmental guidelines and supervision. If granted approval subject to conditions, the proponents must report upon fulfilment of the required conditions, and are subject to inspections to check their compliance.
The extraterritorial application of EIA by the US was confirmed in 1979, when President Carter issued Executive Order 12114 on environmental effects abroad of major actions. Its preamble states that its purpose is to ‘further environmental objectives consistent with the foreign policy and national security policy of the United States’. Executive Order 12114 applies to any major federal action significantly affecting the environment of a foreign nation. It binds all federal agencies, obviously including those engaged in aid and development assistance.
The international application of EIA has been required by many other national and international agencies. The World Bank has required EIA for projects that it funds for over 25 years. It has in place a sophisticated set of mechanisms to assess and review negative environmental impacts, including an external International Inspections Panel and a civil society complaints and appeals process.
The EIA model provides relevant lessons for the design of features for a counterterrorism filter for development assistance. For example, aid delivery agents could be required to assess the risk of development assistance being misused to promote violent extremism.
Categories could be developed to help identify significant risks of misuse, such as ratings for the track records of the aid delivery agent, host government and local civil society in combating, tolerating or promoting terrorism. Conditions could be designed into the award of assistance to minimise identified risks. Conditions might include requirements imposed uoon development assistance managers to exercise due diligence and upon delivery agencies to to adopt risk amelioration measures. Conditions might also impose obligations upon delivery agencies to produce compliance reports on risk amelioration, and to address misuse complaints in parallel with best international practice in environmental management. Non-compliance with conditions should result in a suspension of funding to the ultimate recipient and, in cases of probable negligence or bad faith, suspension of contracts with the culpable delivery agencies or aid managers.
In relation to NGOs, Special Recommendation 8 of the OECD Financial Action Task Force also needs be kept in mind. In effect, it urges countries to exercise diligence when channelling aid through the non-profit sector to prevent its misuse for terrorism. Special Recommendation 8 notes that non-profit organisations are particularly vulnerable to abuse for the financing of terrorism, and recommends that:
‘Countries should ensure that they cannot be misused: (i) by terrorist organisations posing as legitimate entities; (ii) to exploit legitimate entities as conduits for terrorist financing, including for the purpose of escaping asset freezing measures; and (iii) to conceal or obscure the clandestine diversion of funds intended for legitimate purposes to terrorist organisations.’
Therefore, Australia is already committed under Special Recommendation 8 to detect, prevent and suppress the financing of terrorism through non-profit organisations. When dispersing its own financial aid, meeting this commitment is at its most direct and simple.
Given that complaints do arise in relation to misuse of aid, and that no filter mechanism is currently in place to ensure Australian aid is not misused to promote violent extremism, the question is, can’t we do better?