Global Corruption report: Climate Change

30 April 2011

Corruption and climate change – who is most at risk
Climate Change Governance: reducing corruption risks
Where will transparency matter most
What needs to be done
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Resources
Media coverage

Corruption and climate change – who is most at risk

The impacts of climate change will be felt all over the world, in developed and developing countries alike. At risk are billions of dollars but more importantly the lives and livelihoods of millions of people. Corruption cannot be allowed to jeopardise efforts to combat climate change.

Many of those countries judged most vulnerable to the most visible effects of climate change– drought, flooding, storms or rising sea levels – are also countries where experts perceive high levels of corruption in public services. None of the 20 countries deemed most vulnerable to climate change score more than 3.6 on TI’s Corruption Perceptions Index (CPI) indicating significant risks of corruption.

Almost 300 million people live in the five countries most vulnerable to climate change – Bangladesh, Honduras, Myanmar, Nicaragua, and Vietnam. By 2015, 375 million people could be affected by climate disasters annually. More on the corruption risks in humanitarian disasters on the TI blog.

Climate Change Governance: reducing corruption risks

Like corruption, climate change is a global problem that demands a global solution. Meeting this challenge will require unprecedented international cooperation both in the developed and developing world.

Transparency International’s Global Corruption Report: Climate Change explores climate-related corruption risks and argues that a dramatic strengthening of governance mechanisms can reduce corruption risks and make climate change policy more effective and more successful.

Governments have pledged at least US $100 billion per year by 2020 to be spent on projects and incentives to meet commitments to reduce greenhouse gas emissions and safeguard against the effects of climate change.

How well this money is used and how these measures are managed will determine the effectiveness of global efforts to combat climate change. With so much at stake, it is imperative that all actors involved – governments, civil society, and the private sector – build transparency and accountability into the system from the start.

Where will transparency matter most

The Global Corruption Report (GCR) looks at key areas where transparency will be crucial to combating corruption risks:

How fair and open is climate policy and decision making?

Parts two and three of the GCR investigate the processes involved in deciding who receives and manages climate change funding and how policies are shaped at international, regional and local levels. Although the world’s attention gravitates to global meetings like Copenhagen in 2009 or Cancun in 2010, where of over 190 countries and 1000 organisations convene, away from the spotlight many other environmental agreements, already in place, must be managed with transparency and public participation.

Mitigation

Mitigation efforts aim to slow climate change by reducing the amount of greenhouse gases emitted globally. Mitigation efforts include increasing energy efficiency, transitioning to low-carbon technologies and managing complex carbon markets that give polluters an incentive for reducing their emissions but have already been vulnerable to fraud. Part four discusses the corruption risks in mitigation and recommends ways to make mitigation projects more transparent and accountable.

Carbon markets: Managing public assets transparently

In international carbon trading schemes, individual governments can sell carbon credits when a country’s emissions are below their pollution targets. In an opaque market, the government mismanagement of credits can go unnoticed. Media investigations in Slovakia revealed that the government sold carbon credits at half their value to a company with links to officials in the ministry that made the sale. They made neither the contract nor the price public. The sale represented an estimated €75 million in lost revenue for the people of Slovakia.

Adaptation

The front cover of the GCR shows sea wall defences in Bangladesh, a low-lying country whose population is already affected annually by severe flooding. With increasing temperatures expected to raise sea levels, large scale adaptation projects to protect populations are urgently required. Part five of the GCR looks at climate-proofing with examples from the Philippines and Kenya and discusses the issue of transparency and governance in adaptation financing.

Climate-proofing against typhoons in the Philippines

The Philippines must deal with about 20 typhoons a year, some deadly, most destructive. In 2009 Typhoon Ketsana obliterated 46,000 homes and left thousands stranded. Although a Climate Change Act is supposed to oversee building flood control defences, the Effective Flood Control system is allegedly suffering from neglect. In addition corruption in the granting of permits and licenses means that land development projects that do not meet building codes and zoning restrictions are nevertheless approved. In these cases, corruption has the potential to undermine adaptation efforts and puts lives at risk.

Forestry

Part six of the GCR highlights good governance as a key factor in the success of financial incentives to conserve forests, especially the UN REDD (Reducing Emissions from Deforestation and Forest Degradation) programme that seeks to reduce emissions caused by deforestation and the subsequent use of forest lands for other activities like farming (more on this on the TI blog). Up to US$ 33 billion a year is expected to flow to countries receiving REDD support once it is fully operational. Yet the forest sector is notoriously corrupt and many of the countries that will participate in REDD suffer from poor governance. Addressing corruption and robust monitoring will be crucial to ensure that forests and local communities benefit from REDD.

What needs to be done

If climate governance is not prepared for corruption, corruption will undermine climate governance. The GCR does not just raise the alarm, it provides a risk map of ways to make climate change measures more effective.

Recommendations include:

All conferences and meetings where climate change targets are set should be open to the people they impact and transparent at the international and local levels
Experts monitoring and verifying projects must be independent and not paid from the budget of the project they are overseeing
All climate measures should have strong, well-resourced oversight bodies
Civil society must monitor government commitments to reduce emissions and be involved in development and oversight of national plans for mitigation and adaptation.