Making sure climate money gets to where it’s needed

Filed under - Climate governance

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What’s at stake?

The logic couldn’t be simpler. If money that’s meant to halt global warming or guard us against extreme storms, droughts and floods is lost to corruption, we’re all in serious trouble. Think about it for a minute.

Now think about climate money in your country. Is there enough? Do you know who’s managing it? Who decides how it’s spent? And is anyone checking that it’s achieving what it should. 

What we’re doing about it

Climate money can mean many things. It can be spent on halting global warming; so that’s renewable energy, clean transport, carbon markets or reforestation projects. Or it’s invested in adapting to climate change, which requires infrastructure such as flood defence walls, irrigation systems or emergency shelters. Either way the sums involved can be huge: leaders of developed countries have pledged to deliver up to US $100 billion in climate finance per year by 2020 – many people insist that far more is needed. Finding information about exact figures, transactions and decision-making processes can be very hard, however, if not impossible.

Where secrecy is corruption’s greatest ally, visibility is its best cure. That’s why we’re asking people to help us monitor climate finance in their countries. The more eyes the better, and the lower the risk that these crucial funds will be embezzled, spent unwisely, or diverted from the people who really need it.

On its way from donor government budgets to the projects on the ground, climate finance follows a complex path through a number of institutions. Each step of the way we’re asking questions like these: 

  • Are your budgets publicly available?
  • Are local communities involved when you make decisions about how money should be spent?
  • Can you guarantee that your staff aren’t getting kickbacks from investing in some projects over others?
  • Is an independent body monitoring the work you do?
  • Is it clear who will be held responsible if fraud or corruption occurs?

And if the answer is no, we want to know why.

We need you to be asking these questions, too. It’s crucial that everyone takes an active interest in ensuring that climate money is distributed fairly and spent effectively. Because ultimately we’ll all suffer if something goes wrong.

Increased transparency, clear and enforced chains of accountability, and independent oversight are some of the positive steps that can be taken to addressing problems before they set in.   

Who’s involved

Six of our national chapters are currently working on our Climate Governance Integrity Programme: 

Our staff there are monitoring climate finance as it enters and is distributed throughout their countries. Where they detect a risk that mismanagement or corruption might occur, they’re calling for necessary reforms. These chapters are also working with communities to help ensure that their voices are heard when decisions are made that could seriously impact their futures.  

Internationally we are also talking to key players in the field of climate finance: from the UN, to multilateral development banks, to carbon trading bodies. And to maximise our impact we’ve teamed up with a number of civil society organisations working on similar issues.

Our approach

The first step to guarding climate money against waste or abuse is to gain a clear picture of where it’s coming from and where it’s going. This means mapping out the actors and institutions responsible for climate finance decisions, disbursements and spending, as well as their relationships to one another. These maps will look very different from one country to the next, but they tend to be pretty labyrinthine.

Once we have established which people or organisations wield the most power, or handle the most money, we carry out an assessment of their policies and activities to establish possible vulnerable spots. Some of the hallmarks of a corruption-prone environment are that: 

  • Information isn’t publicly disclosed 
  • Decisions are made behind closed doors
  • There are no policies or procedures to ensure that staff act ethically and within the law
  • Wrongdoing isn’t investigated or penalised

Once we have established where the risks lie we start talking to the people who are best placed to make a difference, be they government officials, fund managers or businesspeople. If that fails we will consider other options, which can include talking to the media or getting members of the public involved.

The cost of corruption in climate finance could be vast, but luckily we are ahead of the game. Processes and behaviours are much easier to change when they are young than once bad habits have set in. Climate finance is a very new mode of financing, and relatively small amounts have been spent so far. What we aim to do is to influence these institutional relationships while they are taking shape, so that they are made corruption-resistant before corruption has had a chance to creep in.

Timeline

  • July 2011: Programme kick-off meeting in the Dominican Republic, coinciding with national launch of Transparency International’s Global Corruption Report: Climate Change, the first comprehensive publication of its kind to explore the corruption risks related to tackling climate change. 
  • November 2011: Ahead of the Cannes G20 meeting, we urged then-G20 President Jacob Zuma to advocate for robust anti-corruption mechanisms in climate financing apparatuses. As the G20 presidency passed to Mexico, climate finance was named one of five G20 priority issues for 2012. Our Mexican chapter is in dialogue with the G20 Anti-Corruption Working Group about how best to achieve practical anti-corruption safeguards in climate governance.
  • December 2011: At the 17th Conference of the Parties (COP17) in Durban, we co-hosted a panel discussion with the Overseas Development Institute on country-level climate finance successes and challenges (see our account). Amid negotiations over the design of the Green Climate Fund we wrote a working paper for government delegations. 
  • First half of 2012: In the lead-up to, and at the Rio+20 UN Conference on Sustainable Development in June, we advocated at both national and international levels to ensure that challenges to climate finance – as a major driver of sustainable development – are adequately addressed. Transparency International Chair Huguette Labelle contacted the Rio+20 Bureau and Secretariat as well as members of the UN High Level Panel on Global Sustainability. She sent a letter accompanied by our suggested amendments to the Rio+20 outcome document and our working paper, ‘Putting climate finance on the Rio+20 agenda.’ Our chapters have been actively pressuring their national delegations on these issues, and mobilising civil society support regionally; read our blog post on Rio+20 here.
  • August 2012: Recommendations made to the Green Climate Fund's first board meeting.
  • September 2013: Launch of our Climate Finance Integrity Talks. This global series of panel discussions and workshops is aimed at pushing the policy debate on climate finance governance. The kick-off event was held in Berlin. Further talks took place in Mexico City, Bangkok and Johannesburg.
  • November 2013: A special session of the Climate Finance Integrity Talks is held on the sidelines of the UN climate conference (COP 19) in Warsaw, where our delegation presented key findings from our research on challenges and opportunities for the governance of climate finance.
  • January/February 2014: Launch of six country reports (An Assessment of Climate Governance) from Bangladesh, Dominican Republic, Kenya, Maldives, Mexico and Peru. These assess national institutions, systems and decision-making processes that are relevant to climate investment.
  • February-July 2014: Release of five anti-corruption assessment reports (Protecting Climate Finance) about key global climate funds: Adaptation Fund | Climate Investment Funds | Global Environment Facility’s LDCF and SCCF | UN-REDD Programme | Forest Carbon Partnership Facility
  • October 2014: Submission of recommendations to the eighth meeting of the Board of the Green Climate Fund

More…

Contact us

Lisa Elges, Programme Manager
lelges@transparency.org

Claire Martin, Research and Capacity Building Coordinator
cmartin@transparency.org

Leah Good, Programme Coordinator
lgood@transparency.org

Brice Böhmer, Programme Coordinator
bboehmer@transparency.org

Video introducing the Global Corruption Report: Climate Change



Country / Territory - International   |   Bangladesh   |   Dominican Republic   |   Kenya   |   Maldives   |   Mexico   |   Peru   
Region - Global   |   Sub-Saharan Africa   |   Americas   |   Asia Pacific   |   Europe and Central Asia   
Language(s) - English   
Topic - Climate governance   |   Environment   

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