Official development assistance received by developing countries in 1981 a m o u n t e d to $35 b i l l i on . The multilateral bilateral development agencies that disburse these funds the in te rna t iona l organiza t ions that influence the nature of the programs must meet several sets of sometimes differing objectives, which may or may not include environmental concerns. The funding agencies must reconcile the interests of the governments providing the funds with the needs of the governments receiving them. Their own institutional interests lie in supporting projects that yield reliable economic returns, are easily implemented, are replicable. To accomplish this, the agencies may have to influence the policies of recipient governments to create a stable economic environment for future loans repayments. At the same time, funding agencies must also consider the theories preferences about development planning held by i n t e r n a t i o n a l organiza t ions with specialized constituencies by influential academics professionals. Between September 1982 March 1983, research was conducted on a project evaluating the environmental procedures guidelines that govern development aid. The work was undertaken by the Joint Environmental Service of the International Institute for Environment Development (lIED) and the I n t e r n a t i o n a l U n i o n for the Conservation of Nature Natural Resources (IUCN) for the DirectorateGeneral for Development of the C o m m i s s i o n for the E u r o p e a n Communities. This article presents some methods findings of the survey its implications for environmentally sound development assistance. First it is necessary to outline the institutional set t ing in which guidel ines for environmental planning assessment are composed administered. One important conclusion of this report is that systems for reaching appropriate technical solutions are inevitably shaped by institutional constraints.