blog 11.09.2024

Climate finance

Takeaways on corruption and integrity risks in climate solutions: from setting the scene to concrete cases

Speakers: Sindi Kuci, Research Assistant, LSE Grantham Research Institute on Climate Change and the Environment; Sanjeev Narrainen, Integrity and Compliance Manager, the Green Climate Fund; Dieter Zinnbauer, Independent Consultant and Research Fellow, Copenhagen Business School; and Michael Nest, Independent Researcher.

Moderator: Bayartsetseg Jigmiddash, Outreach and Engagement Manager, the Independent Integrity Unit of the Green Climate Fund.

  • Corruption and integrity risks in climate solutions encompass several issues, including the misuse and diversion of financial flows (e.g., bribery, money laundering, misappropriation of funds, tax fraud), climate washing (such as misleading advertisements and public communications, misleading ESG credentials, and false or misleading carbon credit claims), and abuse of process (e.g., failure to obtain free, prior and informed consent - FPIC, or conflicts of interest);

  • Addressing these risks is crucial due to the global and complex nature of climate change, the large scale of climate finance, and the interplay between the Global North and South.

  • Preventing and managing integrity risks in climate finance can be achieved through supranational tools such as MDB Integrity and Accountability mechanisms, UN conventions (UNCAC, UNTOC, UNFCCC), COP and other initiatives like benefit ownership registries, Integrity Council for the Voluntary Carbon Market (ICVCM), and CSO multi-stakeholder initiatives like the Climate Finance Group for Latin America;

  • To enhance coordination, collaboration, and integration, we can focus on reinforcing existing supranational instruments and initiatives, breaking down silos (e.g., integrating MDB integrity mechanisms), fostering innovation, and enhancing the role of public participation and civil society involvement;

  • Fast-tracking integrity should involve leveraging diverse pockets of practice such as effective compliance and risk management, anti-corruption measures in emergency contexts, reforms in permitting and siting processes, and reducing bureaucratic red tape;

  • Fast-tracking integrity involves three key phases: design and development (Frontload), implementation (Streamline), and accountability (Backload). The Frontload phase should focus on transparency (e.g., open procurement and contracts), participation (early engagement with low barriers to entry, a blend of formal and informal approaches, and a focus on finding common ground and shared benefits), as well as pre-screening, framework agreements, and pre-approvals for designated zones.

  • The Climate and Corruption Case Atlas is an evolving and dynamic resource, featuring over 80 cases from 49 jurisdictions worldwide. Twelve types of corrupt behavior were identified, with the most common acts including fraud, undue influence, undeclared and thus unmanaged conflicts of interest, collusion, and bribery.

  • While the Atlas includes cases from across the globe, the majority are from the US and Europe, largely due to higher transparency in reporting corruption and a free press. Although many crimes are transnational, comprehensive information is often lacking.

  • A significant gap remains in the understanding between professionals in the environmental and climate sectors and those focused on anti-corruption efforts. This gap often arises because the anticorruption community tends to emphasize financial loss, while the broader, more urgent concern is the planet's well-being. Forums like this one can help bridge this divide, fostering a deeper mutual understanding and paving the way for more accurate, compelling reporting and research that reflects both perspectives.

Useful Resources:

Got any cases that you would like to highlight and feature on the Climate and Corruption Case Atlas? Share them via climate@transparency.org.

The full recording of the presentation from 11 September Climate finance working group meeting is available here: