USC Subchapter IV

USC Subchapter IV
in effect

22 U.S.C. § 9651 Establishment of risk and audit committees

(a) In generalTo assist the Board to fulfill its duties and responsibilities under section 9621(a) of this title, the Corporation shall establish a risk committee and an audit committee. (b) Duties and responsibilities of risk committeeSubject to the direction of the Board, the risk committee established under subsection (a) shall have oversight responsibility of—(1) formulating risk management policies of the operations of the Corporation; (2) reviewing and providing guidance on operation of the Corporation’s global risk management framework; (3) developing policies for enterprise risk management, monitoring, and management of strategic, reputational, regulatory, operational, developmental, environmental, social, and financial risks; (4) developing the risk profile of the Corporation, including a risk management and compliance framework and governance structure to support such framework; and (5) developing policies and procedures for assessing, prior to providing, and for any period during which the Corporation provides, support to any foreign entities, whether such entities have in place sufficient enhanced due diligence policies and practices to prevent money laundering and corruption to ensure the Corporation does not provide support to persons that are—(A) knowingly engaging in acts of corruption; (B) knowingly providing material or financial support for terrorism, drug trafficking, or human trafficking; or (C) responsible for ordering or otherwise directing serious or gross violations of human rights. (c) Duties and responsibilities of audit committeeSubject to the direction of the Board, the audit committee established under subsection (a) shall have the oversight responsibility of—(1) the integrity of the Corporation’s financial reporting and systems of internal controls regarding finance and accounting; (2) the integrity of the Corporation’s financial statements; (3) the performance of the Corporation’s internal audit function; and (4) compliance with legal and regulatory requirements related to the finances of the Corporation.

22 U.S.C. § 9652 Performance measures, evaluation, and learning

(a) In generalThe Corporation shall develop a performance measurement system to evaluate and monitor projects supported by the Corporation under subchapter II of this chapter and to guide future projects of the Corporation. (b) ConsiderationsIn developing the performance measurement system required by subsection (a), the Corporation shall—(1) develop a development impact measurement system, to be known as the Corporation’s Impact Quotient, which shall—(A) serve as a metrics-based measurement system to assess a project’s expected outcomes and development impact on a country, a region, and populations throughout the sourcing, origination, management, monitoring, and evaluation stages of a project’s lifecycle; (B) enable the Corporation to assess development impact at both the project and portfolio level; (C) provide guidance on when to take appropriate corrective measures to further development goals throughout a project’s lifecycle; and (D) inform congressional notification requirements outlining the Corporation’s project development impacts; (2) develop a mechanism for ensuring that support provided by the Corporation under subchapter II of this chapter is in addition to private investment; (3) develop standards for, and a method for ensuring, appropriate financial performance of the Corporation’s portfolio; (4) develop standards for, and a method for evaluating and documenting the development impacts of the Corporation’s portfolio, including—(A) measurement of the projected and ex post development impact of a project; and (B) the information necessary to comply with section 9653 of this title; (5) develop standards for, and a method for ensuring, appropriate monitoring of the Corporation’s compliance with environmental and social standards consistent with the guidance published by the Corporation following broad consultation with appropriate stakeholders to include civil society; and (6) develop standards for, and a method for ensuring, appropriate monitoring of the Corporation’s portfolio, including standards for ensuring employees or agents of the Corporation identify and conduct in-person site visits of each high-risk loan, loan guarantee, and equity project, as necessary and appropriate, after the initial disbursement of funds. (c) Required performance measures update for Congressional Strategic Advisory GroupAt any meeting of the Congressional Strategic Advisory Group, the Corporation shall be prepared discuss the standards developed in subsection (b) for all ongoing projects. (d) Public availability of certain informationThe Corporation shall make available to the public on a regular basis information about support provided by the Corporation under subchapter II of this chapter and performance metrics about such support on a country-by-country basis. (e) ConsultationIn developing the performance measurement system required by subsection (a), the Corporation shall consult with the Development Advisory Council established under section 9613(i) of this title and other stakeholders and interested parties engaged in sustainable economic growth and development. (f) Staffing for portfolio oversight and reporting(1) Requirement to maintain capacityThe Corporation shall maintain an adequate number of full-time personnel with appropriate expertise to fulfill its obligations under this section and section 9653 of this title, including—(A) monitoring and evaluating the financial performance of the Corporation’s portfolio; (B) evaluating the development and strategic impact of investments throughout the program lifecycle; (C) preparing required annual reporting on the Corporation’s portfolio of investments, including the information set forth in section 9653(a)(6) of this title; and (D) monitoring for compliance with all applicable laws and ethics requirements. (2) QualificationsPersonnel assigned to carry out the obligations described in paragraph (1) shall possess demonstrable professional experience in relevant areas, such as development finance, financial analysis, investment portfolio management, monitoring and evaluation, impact measurement, or legal and ethics expertise. (3) Organizational structureThe Corporation shall maintain such personnel within 1 or more dedicated units or offices, which shall—(A) be functionally independent from investment origination teams; (B) be managed by senior staff who report to the Chief Executive Officer or Deputy Chief Executive Officer; and (C) be allocated resources sufficient to fulfill the Corporation’s obligations under this section and to support transparency and accountability to Congress and to the public. (4) Insulation from reductionsThe Corporation may not reduce the staffing, funding, or organizational independence of the units or personnel responsible for fulfilling the obligations under this section unless—(A) the Chief Executive Officer certifies in writing to the appropriate congressional committees that such reductions are necessary due to operational exigency, statutory change, or budgetary shortfall; and (B) the Corporation includes in its annual report a detailed explanation of the impact of any such changes on its capacity to analyze and report on portfolio performance.

22 U.S.C. § 9653 Annual report

(a) In generalAfter the end of each fiscal year, the Corporation shall submit to the appropriate congressional committees a complete and detailed report of its operations during that fiscal year, including an assessment of—(1) the economic and social development impact, including with respect to matters described in subsections (d), (e), and (f) of section 9651 of this title, of projects supported by the Corporation under subchapter II of this chapter; (2) the extent to which the operations of the Corporation complement or are compatible with the development assistance programs of the United States and qualifying sovereign entities; (3) the Corporation’s institutional linkages with other relevant United States Government department 11 So in original. Probably should be “departments”. and agencies, including efforts to strengthen such linkages; (4) the compliance of projects supported by the Corporation under subchapter II of this chapter with human rights, environmental, labor, and social policies, or other such related policies that govern the Corporation’s support for projects, promulgated or otherwise administered by the Corporation; (5) the United States strategic, foreign policy, and development objectives advanced through projects supported by the Corporation; and (6) the health of the Corporation’s portfolio, including an annual overview of funds committed, funds disbursed, default and recovery rates, capital mobilized, equity investments’ year on year returns, and any difference between how investments were modeled at commitment and how they ultimately performed, to include a narrative explanation explaining any changes. (b) ElementsEach annual report required by subsection (a) shall include analyses of the effects of projects supported by the Corporation under subchapter II of this chapter, including—(1) reviews and analyses of—(A) the desired development impact and strategic outcomes for projects, and whether or not the Corporation is meeting the associated metrics, goals, and development objectives, including, to the extent practicable, in the years after conclusion of projects; (B) whether the Corporation’s support for projects that focus on achieving strategic outcomes are achieving such strategic objectives of such investments over the duration of the support and lasting after the Corporation’s support is completed; (C) the value of private sector assets brought to bear relative to the amount of support provided by the Corporation and the value of any other public sector support; (D) the total private capital projected to be mobilized by projects supported by the Corporation during that year, including an analysis of the lenders and investors involved and investment instruments used; (E) the total private capital actually mobilized by projects supported by the Corporation that were fully funded by the end of that year, including—(i) an analysis of the lenders and investors involved and investment instruments used; and (ii) a comparison with the private capital projected to be mobilized for the projects described in this paragraph; (F) a breakdown of—(i) the amount and percentage of Corporation support provided to less developed countries, advancing income countries, and high-income countries in the previous fiscal year; and (ii) the amount and percentage of Corporation support provided to less developed countries, advancing income countries and high-income countries averaged over the last 5 fiscal years; (G) a breakdown of the aggregate amounts and percentage of the maximum contingent liability of the Corporation authorized to be outstanding pursuant to section 1433 in less developed countries, advancing income countries, and high-income countries; (H) the risk appetite of the Corporation to undertake projects in less developed countries and in sectors that are critical to development but less likely to deliver substantial financial returns; and (I) efforts by the Chief Executive Officer to incentivize calculated risk-taking by transaction teams, including through the conduct of development performance reviews and provision of development performance rewards; (2) an explanation of any partnership arrangement or cooperation with a qualifying sovereign entity in support of each project; (3) projections of—(A) development outcomes, and whether or not support for projects are meeting the associated performance measures, both during the start-up phase and over the duration of the support, and to the extent practicable, measures of such development outcomes should be on a gender-disaggregated basis, such as changes in employment, access to financial services, enterprise development and growth, and composition of executive boards and senior leadership of enterprises receiving support under subchapter II of this chapter; and (B) the value of private sector assets brought to bear relative to the amount of support provided by the Corporation and the value of any other public sector support; (4) to the extent practicable, recommendations for measures that could enhance the strategic goals of projects to adapt to changing circumstances; and (5) an assessment of the extent to which lessons learned from the monitoring and evaluation activities of the Corporation, and from annual reports from previous years compiled by the Corporation, have been applied to projects.

22 U.S.C. § 9654 Publicly available project information

The Corporation shall— (1) maintain a user-friendly, publicly available, machine-readable database with detailed project-level information, as appropriate and to the extent practicable, including a description of the support provided by the Corporation under subchapter II of this chapter, which shall include, to the greatest extent feasible for each project—(A) the information included in the report to Congress under section 9653 of this title; (B) project-level performance metrics; and (C) a description of the development impact of the project, including anticipated impact prior to initiation of the project and assessed impact during and after the completion of the project; and (2) include a clear link to information about each project supported by the Corporation under subchapter II of this chapter on the internet website of the Department of State, “ForeignAssistance.gov”, or a successor website or other online publication.

22 U.S.C. § 9655 Engagement with investors

(a) In generalThe Corporation, acting through the Chief Development Officer, shall, in cooperation with the Administrator of the United States Agency for International Development—(1) develop a strategic relationship with private sector entities focused at the nexus of business opportunities and development priorities; (2) engage such entities and reduce business risks primarily through direct transaction support and facilitating investment partnerships; (3) develop and support tools, approaches, and intermediaries that can mobilize private finance at scale in the developing world; (4) pursue highly developmental projects of all sizes, especially those that are small but designed for work in the most underdeveloped areas, including countries with chronic suffering as a result of extreme poverty, fragile institutions, or a history of violence; and (5) pursue projects consistent with the policy of the United States described in section 9611 of this title and the Joint Strategic Plan and the Mission Country Development Cooperation Strategies of the United States Agency for International Development. (b) AssistanceTo achieve the goals described in subsection (a), the Corporation shall—(1) develop risk mitigation tools; (2) provide transaction structuring support for blended finance models; (3) support intermediaries linking capital supply and demand; (4) coordinate with other Federal agencies to support or accelerate transactions; (5) convene financial, donor, civil society, and public sector partners around opportunities for private finance within development priorities; (6) offer strategic planning and programming assistance to catalyze investment into priority sectors; (7) provide transaction structuring support; (8) deliver training and knowledge management tools for engaging private investors; (9) partner with private sector entities that provide access to capital and expertise; and (10) identify and screen new investment partners. (c) Technical assistanceThe Corporation shall coordinate with the United States Agency for International Development and other agencies and departments, as necessary, on projects and programs supported by the Corporation that include technical assistance.

22 U.S.C. § 9656 Notifications to be provided by the Corporation

(a) In generalNot later than 15 days prior to the Corporation making a financial commitment associated with the provision of support under subchapter II of this title in an amount in excess of $20,000,000, the Chief Executive Officer of the Corporation shall submit to the appropriate congressional committees a report in writing that contains the information required by subsection (b). (b) Information requiredThe information required by this subsection includes—(1) the amount of each such financial commitment; (2) an identification of the recipient or beneficiary; (3) a description of the project, activity, or asset and the Corporation’s impact quotient outlining the development goal or purpose to be achieved by providing support by the Corporation; and (4)(A) information relating to whether the Corporation has accepted a creditor status that is subordinate to that of other creditors in the project, activity, or asset; and (B) for all projects, activities, or assets that the Corporation has accepted a creditor status that is subordinate to that of other creditors the Corporation shall include a description of the substantive policy rationale required by section 9623(b)(12) of this title that influenced the decision to accept such a creditor status. (c) Bilateral agreementsThe Chief Executive Officer of the Corporation shall notify the appropriate congressional committees not later than 30 days after entering into a new bilateral agreement described in section 9631(a) of this title.

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