The Green Climate Fund and environmental and social safeguards Leonardo Paat, Jr. Washington DC, 05 October 2016

About GCF World’s largest climate fund Agreed by 194 Parties to the UNFCCC Provide support to developing countries Mitigation: reduce greenhouse gas emissions World’s largest climate fund. Agreed by 194 Parties to the UNFCCC (Cancun Agreement 2010). Operating Entity of the financial mechanism, accountable and under the guidance of the COP. Created to support low-emission (mitigation) and climate-resilient (adaptation) investments in developing countries; and Investment mix: public and private sector, and here GCF is determined to partner with the private sector and harness its implementation capacity, to catalyze investments and maximize impact. Adaptation: adapt to unavoidable impacts Investment mix: public and private sector

Background Commitment and mandate to adopt best practice environmental and social safeguards (Governing Instrument for the Green Climate Fund) Adoption of the IFC’s Performance Standards on Environmental and Social Sustainability as interim environmental and social safeguards (ESS) standards (Decision B.07/02 paragraph (c)) Initial proposal approval process describing interim ESS compliance assessment by the Secretariat (Decision B.07/03 paragraph (a), Annex VII) Further description of assessing conformance to the Fund’s ESS (Decision B.08/02, Annex 1)  Development of an environmental and social management system (ESMS) for the Fund (Decision B.07/02 paragraph (n)) Key decisions pertaining to environmental and social risk management

Environmental and social management system (ESMS) Set of management processes and procedures for avoiding, reducing and managing adverse environmental and social impacts, maximizing any potential benefits, and improving the environmental and social performance over time and in consistent ways. It brings together the various existing policies and practices Accreditation Framework Results Management Framework Monitoring and Accountability Framework Information Disclosure Policy Risk Guidelines and Register Independent Redress Mechanism Gender Policy

Key considerations and elements of ESMS Environmental and social policy Links to existing policies and practices Environmental and social standards Management processes and procedures Stakeholder engagement Guidance, tools, best practices Driven by overarching environmental and social policy Links to existing policies and practices Requirements set by the environmental and social standards Implemented through set of management processes and procedures Involves stakeholders Guided with tools and best practices

Institutional assessment Programmes and projects assessment Secretariat’s assessments Capacity and commitment to manage and implement the ESS requirements ESMS (PS 1: Assessment and Management of Environmental and Social Risks and Impacts) Institutional assessment Risk screening based the ESS standards and the accreditation of the entity. Assessment instruments and management plans Safeguards implementation and supervision including roles and responsibilities, capacities, monitoring, and reporting Stakeholder participation and consultation Programmes and projects assessment

ESS of approved projects Eastern Europe 1 Approved projects: 17 Of which 9 are Category B 5 are Category C 3 Intermediary (I2 and I3) Most cited applicable PS:1,3, and 4 Management instruments: ESMP and ESMF ESA done for Category B Risk screening of all projects Asia-Pacific 7 Africa 5 Latin America 4 With these resources the Fund’s current GCF portfolio looks like this: 17 projects and programmes (8 at B.11 and 9 at B.13) for a total GCF funding amount of USD 424 million, and USD 1.2 billion in total project costs. The geographic distribution of the 17 projects or programmes consists of: 5 in Africa w/ GCF funding of USD 88 million (21%) [East Africa (Kenya, Rwanda, Uganda), Gambia, Malawi, Mali, Senegal] 7 in Asia-Pacific w/ GCF funding of USD 217 million (51%) [Bangladesh, Fiji, Maldives, Sri Lanka, Tajikistan and Uzbekistan, Tuvalu, Vietnam] 4 in Latin America and Caribbean w/ GCF funding of USD 99 million (23%) [Chile, El Salvador, Mexico, Peru,] 1 in Eastern Europe w/ GCF funding of USD 20 million (5%) [Armenia] In terms of funding theme mix: 15% mitigation 52% adaptation 33% cross cutting (that is mix of M&A) In terms of financial instrument mix: 74% grants 16% loans 5% equity 5% guarantee

Stakeholder engagement Stakeholder analysis and planning Country ownership Information disclosure Grievance and redress mechanism

Summary The ESMS is currently being developed that builds upon the existing policies and practices of the Fund and supported by the interim environmental and social safeguards standards The ESMS and the ESS are expected to continue to evolve and improve over time Practices continuously fine-tuned to meet ESS requirements Relevant best practices, tools, and guidance are sought to improve ESS application and outcomes