Graham Tupper (Director, Transparency International Australia) - Presentation at the United Nations Association of Australia (Victorian Division) Climate Finance: Sustainability with Integrity Seminar. The seminar, part of the UNAA (Vic) Sustainability Leadership Series, was held in Melbourne on 29 October 2012, in partnership with National Australia Bank. Building momentum for collective action post-Rio+20, the seminar brought together key players from government, business and civil society to discuss the challenges and opportunities associated with climate finance. In particular, the seminar addressed issues of governance, transparency and accountability for climate finance, key requirements to ensure that climate finance becomes an effective driver of sustainable development. Expert panel discussion focussed on: - The Australian Government perspective on climate finance: current priorities, role, contributions, and commitments; - The global Green Climate Fund (GCF) and Australia's fast-start finance contribution Issues of transparency and accountability for climate finance governance. - Investor perspective on climate finance: challenges and opportunities and the role of the investment community. - Community development perspective on climate finance: achieving sustainable development objectives - Experiences and opportunities for cross-sector collaboration Facilitator: - Rosemary Sainty (Former Head, Secretariat, UN Global Compact Network Australia and Adviser, Corporate Engagement, Transparency International Australia) Guest Speakers: - Gregory Andrews (Assistant Secretary, Finance, Forests and Development Branch, International Division, Australian Government Department of Climate Change and Energy Efficiency) - Graham Tupper (Director, Transparency International Australia) - Nathan Fabian (Chief Executive, Investor Group on Climate Change) - Dr Simon Bradshaw (Climate Change Advocacy Coordinator, Oxfam Australia) For more information on this or other events in the Sustainability Leadership Series please contact: United Nations Association of Australia (Vic) T: (+613) 9670 7878 E: sustainability@unaavictoria.org.au www.unaavictoria.org.au

1.
“mani belong skai”
Addressing the risks to climate finance integrity
Graham Tupper
Transparency International Australia
October 2012

2. Overview
o High Stakes and Aspects of Integrity
o TI Climate Governance Integrity Program
o Specific Measures: Coherence, Capacity
and Enforcement
o Examples of Tools and Resources
o Lessons from forests and carbon

3. High Stakes – Climate Governance
Scale of investment
required is huge.
Cost of public
confidence being
undermined?
The governance
integrity challenge
of the century!

4. One aspect of the challenge
“Unlike traditional commodities, which
sometime during the course of their market
exchange must be delivered to someone in
physical form,
the carbon market is
based on the lack of delivery,
of an invisible substance,
to no-­‐‑one”
Mark Shapiro “Inside the Carbon Trading Shell Game”, Harpers Magazine 2010.

5. TI Climate Governance Integrity
GOAL:
Prevent corruption from
undermining climate goals.
o Citizen engagement so that climate
finance achieves best social and
environmental benefits.
o Public and private sector climate finance
decision makers adopt and enforce legally
binding and transparent anti-­‐‑corruption
standards.

6. Aspects of Integrity – Mutual Effect
o Government: Treat anti-­‐‑corruption safeguards as
integral elements in the design of mitigation and
adaptation action.
o Business: While going green, adhere to strong
compliance, and anti-­‐‑corruption regime – including to
commit adequate resources to accurate and publicly
accessible reporting.
o Civil Society: Undertake independent oversight and
monitoring of corruption risks in climate finance and
build broad coalitions for integrity in climate finance.
Global Corruption Report on Climate Change 2011

7. The start of a complex journey

8. Finance Integrity Streams
Stream 1
o Public finance provided primarily by
donor countries to support climate
change adaption and mitigation action.
Stream 2
o Public finance to support or leverage
private sector investments in both
developing and developed countries.

9. TI Climate Governance Integrity
o Stage 1 (2011-­‐‑13): Research, capacity
building, assessment of governance
weaknesses.
o Stage 2 (2012-­‐‑2015): Implement strategy
to address key weaknesses -­‐‑ applying
tools and examples of leading practice.

10. Which tracks to take?

11. Coherence and finance tracking
o Donor governments harmonise their country
assistance strategies under the leadership of the
recipient country to ensure coherent support to
relevant institutions.
o Recipient governments are required to report
on integration of climate finance into national
policy, planning and budgetary systems.
Coherence: “clearly connected” “consistent”

12. Capacity and finance management
o Governments undertake regular capacity
assessment to ensure national entities
established for managing funds are equipped
with the resources and skills needed to fulfil
their fund allocation and monitoring roles.
o Capacity building programs which integrate
proven anti-­‐‑corruption measures to strengthen
integrity of institutions and legal and
regulatory frameworks.
Capacity: “abilities” “managing resource limits”

13. Capacity indicators and tests
o Full budget transparency by revenue source
and sector at all levels – national to local.
o Climate finance plans and documents have easy
and timely access to facilitate meaningful
citizen engagement.
o Reporting transparently on results and
outcomes against clear goals – verified with
citizen engagement.

14. Enforcing accountability
o Transparent legal and administrative policies in
place which make clear who decides.
o Citizen hotlines to provide information and to
refer allegations of suspected unethical
behaviour, fraud or corruption.
o Clear guidelines and independent mechanism
to process complaints and investigate
allegations of corruption and fraud.
o Adequate protection for whistle-­‐‑blowers.

15. Where are we heading?

16. Citizen tests in plain language
o Are budgets and plans publicly available and
easy to understand?
o Are local communities involved on decisions
about how money should be spent?
o Are the processes for monitoring accountability
of decision makers clear to citizens?
o Is an independent body monitoring the work
and reporting to communities?
o Is there a clear and trusted process to
investigate allegations of fraud and corruption?

17. Tools to produce the product

18. TI Tools and Resources
o Integrity Pacts
o Development Pacts
o Anti-­‐‑corruption Legal Advice
Centres
o Forest governance and integrity
corruption risk assessment tool

19. Project Anti-­‐‑Corruption System PACS
Jointly developed tool by TI-­‐‑UK and Global
Infrastructure Anti-­‐‑corruption Centre (GIACC):
Anti-­‐‑corruption standards and templates for:
Independent assessment, Transparency,
Procurement, Pre-­‐‑contract disclosure,
Project anti-­‐‑corruption commitments,
Funder anti-­‐‑corruption commitments,
Government anti-­‐‑corruption commitments,
Compliance, Audit, Reporting, Enforcement.
hEp://www.giaccentre.org/project_anti_corruption_system_home.php

20. Is it legal? Is it sustainable?

21. Lessons? Forests and Carbon
o Opportunity: sustainable
forestry as cost-­‐‑effective
carbon abatement -­‐‑ income
and jobs for communities.
o Risk – “mani belong skai”
scams and corrosion of forest
governance integrity.

22. More information
www.transparency.org
Climate Governance
Integrity Program
TI Australia
www.transparency.org.au