There is an urgent need to ensure that the Green Climate Fund (GCF) has both the financial resources and the effective governance to achieve its mandate: to support developing countries in reducing their greenhouse gas (GHG) emissions and adapt to climate change.
There are currently no criteria on how much the first replenishment of the GCF should aim to raise and how the financial effort among contributors should be shared.
This working paper argues that a more objective and transparent framework for determining contributions to the GCF is needed to strengthen the predictability of GCF resources, one that uses as a reference point a formula-based scaled indicative minimum threshold. This formula could be based, for illustrative purposes, on gross national income (GNI), cumulative GHG emissions, and GHG emissions per capita.
There is a need to strengthen the board’s effectiveness in making decisions, allowing dissenting opinions without holding up critical decisions, and agreeing to a decision-making procedure if efforts to reach consensus have been exhausted. An independent review of the board’s performance, as well as a self-assessment by the board, can also help improve its governance.