With the aim to approve first projects before COP21 in Paris, today the Board of the Green Climate Fund (GCF) will consider the first 8 funding proposals to receive Fund’s resources. Despite the opposition from the civil society, the Fund is also considering to accredit two high profile fossil fuel funders – HSBC and Crédit Agricole, – that are aiming to channel the Fund’s resources.
Starting yesterday, the Green Climate Fund (GCF) held its 11th meeting of the GCF Board in Livingstone, Zambia. Rather than just another one in line of Board meetings, decisions reached during the 4 days in Zambia will set the legacy of the Fund, as the members of the Board will for the first time approve project proposals eligible for GCF finance. The Fund is also planning to build up the number of accredited entities through which it will be channelling its resources.
At the meeting the Board will consider 8 projects worth $168 million. The funding proposals include themes such as energy efficiency, green bonds, water access, and land-use management. Five of the funding proposals come from international accredited entities (United Nations Development Programme, German Development Bank (KfW), Inter-American Development Bank, Asian Development Bank), two from national (Profonape from Peru and Centre de Suivi Ecologique from Senegal), and one from a regional entity (Acumen based in USA). Carbon Market Watch along with other civil society groups raised some concerns with specific projects, due to issues including lack of consultation process, disregard for indigenous peoples rights, and also with the overall information disclosure policy.
However, further indignation from civil society has been raised in reaction to consideration of 9 new accredited entities, principally the HSBC and Crédit Agricole. The two banks have been heavily contested due to being major fossil fuel funders, each channelling more than €7 billion to the coal sector. In addition, there are concerns about the banks having a track record of money laundering scandals, and poor policies to safeguard social, gender, and environmental impacts.
The track records of these two entities are neither compatible with the Fund’s fiduciary standard, nor with the Fund’s objective to become a transformational institution in climate finance. Civil society organisations have demanded to rule against high profile coal supporters from receiving Fund’s resources. The Board will take the decision on accreditation this week.
In the next days, the Board will determine the direction of the Fund and send a signal before Paris on the flow of climate finance. Approving the first projects will be the first opportunity to demonstrate the effectiveness and efficiency of the fund, while the accreditation procedure will show the true colours of the GCF.