The green accountability agenda is a localization agenda

s thousands gather in New York this week for Climate Week and the UN General Assembly, there will be much discussion of how we reach climate goals and many conversations that touch on localization debates. Yet the two agendas are inter–related and mutually reinforcing. We see an opportunity to align efforts.

• Editor’s note: This article is based on a new working paper by the authors, prepared for the World Bank’s 2^nd Symposium on Supranational Responses to Corruption: Integrity in Climate Finance and Action.

There are many examples of climate projects gone wrong due to a lack of transparency and accountability. UNCTAD research points to glaring accountability gaps in relation to climate adaptation projects, saying that one in six projects risk maladaptation due to a lack of green accountability measures. But broader evidence suggests that accountability of climate finance increases the closer you get to the ground—the more you involve local communities in the design and delivery of projects, the greater their incentive to oversee and demand results.

In Kenya, the Financing Locally Led Climate Action (FLLoCA) program sends 90% of its funds to county and community–level projects, ensuring that support for climate resilience reaches those most at risk. Results indicate much improved outcomes relating to natural resource management but also stronger, more responsive institutions. The Pawanka Fund, meanwhile, supports indigenous–led climate efforts, centers self determination and intercultural philanthropy, and is run by indigenous leaders around the world. Their grantmaking has shown profound and catalytic effects in terms of how indigenous communities are meeting operational, administrative, and social justice standards. Both of these examples, and many others, make the case for locally–led adaptation to address the disproportionate vulnerabilities and historical power imbalances that climate change is expected to deepen.

There are many valuable lessons here, from inclusive country–level dialogue, to equitable fund distribution and ongoing oversight. As climate finance flows increase, one way to ensure integrity will be the creation of efficient country platforms that verify funds received and also help determine how those funds are spent. Yet, there remain a few high–profile national climate efforts that have not taken these lessons into account. Some Just Energy Transition Partnership (JETP) countries, for example, have a tendency to rely on hierarchical processes which often undermine public trust and legitimacy. The paper includes convincing evidence from other sectors where inclusivity is a key part of the project success. Where communities are perceived as involved actors with significant agency and ownership of how climate finance is spent, the quality of delivery is improved.

Civil society has a critical role to play as increased levels of funding are channeled through global climate facilities. However, too often CSOs are constrained to “observer” roles. Limited civic engagement inevitably limits green accountability and community ownership. In this paper we present a few alternative approaches that can help ensure that funding flows impact people’s local realities. There are ways to foster meaningful independent civil society involvement, particularly in relation to funding decisions and monitoring of project implementation in contexts where participation is constrained by conflict or civic space restrictions. CSOs can help manage top–down integrity risks and assist with citizen–engagement from the bottom–up. 

The Independent High–Level Expert Group on Climate Finance estimates that at least $2.4 trillion is needed annually for climate projects in emerging markets and developing economies, excluding China. This target will require a fivefold increase from current levels of climate finance. However, of current investment, little is reaching local levels, and the  portion that goes to civil society and climate accountability dimensions is a tiny fraction of existing commitments. This presents a challenge because civil society cannot play a useful role in overseeing climate spending if the responsibility is left as an unfunded mandate. Major development finance institutions need to step up and we welcome the call from Global Citizen for a $50 million fund for independent civil society as a starting point.

Encouragingly, promising research from Systemiq’s Blended Finance Taskforce suggests that investing 5–10% of climate finance to accountability dimensions would essentially pay for itself several times over. Analysis shows that a climate finance system which integrates green accountability measures could potentially save more than $100 billion a year and avoid 3 gigatons of annual greenhouse gas emissions. At a time when accountability and oversight needs are being neglected, these mutually reinforcing benefits are hard to overlook. Funding accountability dimensions could lead to considerably more efficient and equitable projects and also local solutions that are fit for purpose.

The international community is approaching a critical decision this November at COP29 in setting a New Collective Quantified Goal for climate finance. With good reason the focus has largely been on the quantities and sources of financial commitments. However, the process is also an opportunity to address quality concerns and there is an opportunity to build on the growing momentum to localize funds among government and philanthropic donors alike. Stronger commitments to get funds down to the local level and strengthen participation and accountability over the use of climate funds should reassure donor countries that funds will be well spent and also adapted to local needs. Green accountability and the localization of funding are two sides of the same coin. It is past time to invest in both aspects equally.