IFC had an active Category A project with Lonmin Plc, a large platinum producer, for a multi-year expansion program of the company’s operations. The project consisted of the development, expansion, and mechanization of Lonmin’s South African mines, and the development of a comprehensive, large-scale community and local economic development program (LEDP). IFC’s investment in the project entailed a standby 10-year A loan of $100 million and an equity investment of $50 million. IFC completed its involvement in the project in January 2016.

In June 2015, CAO received a complaint from a local community organization and community members regarding Lonmin’s Marikana mine in North West Province, South Africa. The complaint cited concerns about contamination of air and groundwater, and negative impacts on the living conditions of nearby communities, including housing, water, sanitation, infrastructure, and employment. The complaint also cited concerns about the project’s social and environmental commitments, IFC’s social and environmental due diligence, and non-compliance with national law.

CAO found the complaint eligible for further assessment in June 2015, and an assessment trip was conducted in August 2015. During the assessment, the parties agreed to address the issues through a dispute resolution process. CAO subsequently held a series of bilateral meetings with the parties during 2016 to provide capacity building and assist them in drafting and adopting a set of principles to govern the dispute resolution process. CAO also convened several joint meetings as part of the process. However, in December 2016, the complainants decided to withdraw, citing a lack of progress. This decision was confirmed in March 2017, and the case was transferred to CAO's compliance function for appraisal. In December 2017, CAO concluded that the case merited a CAO compliance investigation of IFC’s E&S performance. 

In June 2023, CAO finalized its compliance investigation report. CAO’s investigation reviewed how IFC appraised, structured, and supervised its investment in Lonmin to ensure that impacts of the nature raised by the complainants were adequately considered and mitigated. CAO found that IFC was non-compliant with its environmental and social oversight requirements during both the pre-investment review of Lonmin and its client supervision throughout the investment. In particular, CAO concluded that IFC’s failure to consider implementation of the Social and Labor Plan (a South African national law requirement for mining companies) as an E&S compliance issue was contrary to PS1 requirements. Given the time that had passed since IFC’s divestment (December 2015), and the subsequent change in ownership of the mining company, CAO determined that there was limited scope for CAO to make project-level recommendations. However, CAO did make systemic-level recommendations for IFC to consider in its response. 

On December 7, 2023, the IFC Board approved IFC’s Management Action Plan. Through this plan, IFC committed to develop guidance and strengthen internal controls: (i) to review the adequacy of the client's estimates of resources for the implementation of the Environmental and Social Action Plan (ESAP), as required in Performance Standard 1; and (ii) to document the review as part of the appraisal documentation. IFC will also update and disseminate ESAP guidance as part of its Environmental and Social Review Procedures (ESRP) Handbook. 

On December 7, 2023, IFC’s Board approved a Management Action Plan (MAP) for this case, and on December 11, 2023, after circulating it with the parties, CAO published the approved MAP along with the investigation report and IFC’s Management Report. (See Joint Press Release.)

In January 2025, IFC finalized its first Management Progress Report on the ongoing implementation of the MAP (available in English). In response, in March 2025, CAO completed its first monitoring exercise for this case, which was included in the FY25 Q3 Compliance Omnibus Report. CAO noted that IFC reported updating its procedures and systems to include costing for ESAP, and provided examples demonstrating the implementation of ESAP costing in recent investments. CAO decided to close its monitoring of the systemic-level actions with a “Satisfactory” rating, concluding that IFC had implemented its MAP commitment.