UN’s Green Climate Fund too scared of risk, finds official review
(Climate Home News, 19 Apr 2023) The Green Climate Fund (GCF) has an “underdeveloped” approach to managing project risks because it misses key issues, lacks coherence and makes it difficult to know who is responsible, according to its latest performance review.
Archi Rastogi, lead author of the independent report, said there were clear risks in implementing climate-related projects such as new infrastructure. But projects could also result in maladaptation, where instead of helping communities adapt to climate change they actually make the effects worse, and may have more complex fiduciary risks.
Not recognising or properly managing these made the organisation too cautious, he said.
Developing nations have long pushed the fund to take more risks and provide grants to smaller, more innovative schemes that other funds won’t back.
In 2016, the GCF board agreed that it should “take on risks that other funds/institutions are not able or are willing to take” and adopt a “high level of risk appetite”.
Projects gone wrong
The Green Climate Fund was set up in 2010 and formed part of a compact between poor and rich countries that was the basis for the Paris climate agreement in 2015. It has spent around $20bn so far funding climate projects around the world
Climate Home News, 19 Apr 2023: UN’s Green Climate Fund too scared of risk, finds official review