At COP 16 held in Cancun, Mexico, the Conference of the Parties (COP) decided to establish a
Fund (GCF) in the broad context of long-term support, under which developed countries
committed to jointly mobilize funds rising to USD 100 billion per year by 2020. These funds
would be raised from a mix of public and private sources, including alternative sources.
Parties decided the GCF shall be designated as an operating entity of the financial mechanism
of the Convention under Article 11, with arrangements to be concluded between the COP and the
Green Climate Fund to ensure that it is accountable to, and functions under the guidance of,
the COP. It was also decided that a significant share of new multilateral funding for
adaptation should flow through the GCF. The Fund will support projects, programmes, policies
and other activities in developing country Parties using thematic funding windows.
The Fund will be governed by the Board comprising 24 members, as well as alternate members, with an
equal number of members from developing and developed country Parties.
The COP also decided that the GCF shall be designed by a Transitional
Committee (TC) comprising 40 members - 15 members from developed country Parties and 25 members
from developing country Parties - to design the details of the fund. The Committee held its first
meeting in Mexico City from 28-29 April.
The Committee includes experienced and respected individuals from the fields of finance and climate
change. The exact composition of the Committee is: seven members from Africa; seven members from
Asia; seven members from Latin America and the Caribbean; two members from small island developing
States; two members from the least developed countries and fifteen members from developed
The April meeting, convened by UNFCCC Executive Secretary Christiana Figueres, was attended by a wide
array of observers. This is significant, given that the Transitional Committee will make special
efforts to encourage input from all Parties and from relevant government and non-governmental
organizations and the private sector, who will contribute valuable insights to the design of the
Three Ministers were elected as co-Chairs: Mexican Finance Minister, Ernesto Cordero Arroyo; South
African Minister in the Presidency for Planning, Trevor Manuel; and Norway’s State Secretary at
the Ministry of Finance, Kjetil Lund. This high-calibre chairing arrangement reflects the high rank
of many of the TC members.
Opening the meeting, Ms. Figueres said “the task before you is to propose a design
that will make the Green Climate Fund the window into a new era of vastly greater financing for
climate action in the developing world, and to do so in time for approval in
She cited the launch of the Green Climate Fund as being one of the significant decisions that nations
reached in Cancun, which show that governments can take repeated steps forward, including this year
Members of the Committee stressed the need for efficiency and effectiveness through clear
accountability, ensuring that the fund will be responsive to the needs of developing countries, and
underlining the need for good governance founded on the principles of equity, fairness and trust. They
also underlined the Fund’s role in leveraging other sources of finance, including from the
private sector, in order to scale up climate finance to the levels needed.
“To get government and private capital flowing freely on this scale, the
Green Climate Fund needs to become a trusted avenue for deploying climate funding to the best
effect and it needs to offer a compelling route for private sector capital to engage in bigger
climate investments in the developing world,” said Ms. Figueres.
Both developed and developing countries are seeing this fund as a central tool in assisting countries
to transform their economies to be low-emitting and climate-resilient, and as a critical instrument to
help countries deal with damage resulting from climate change.
“I am convinced that as governments, industry and investors increasingly
realize that a low-carbon future in a world resilient to climate change is not only necessary, but
sustainable and profitable, then the necessary finance will flow faster than many now expect. A
well-designed Green Climate Fund will help ensure that this happens sooner rather than
later,” Ms. Figueres said.
Four work streams were identified, and will be led by eight "work stream co-facilitators."
The work streams can be summarized as follows:
1. Scope, guiding principles and cross-cutting issues: Work under this stream will include, inter
- Objectives and principles
- Thematic scope
- Size and scalability
- Country-led and results-based approaches
- Complementarity and value added
- Methods to enhance complementarity between the Fund’s activities and those of other
bilateral, regional and multilateral funding mechanisms and institutions
2. Governance and institutional arrangements: Work under this stream will include, inter alia:
- Legal and institutional arrangements, including fiduciary management issues, for the
establishment and operationalization of the GCF
- Rules of procedure, functions and responsibilities of the Board and other governance issues
related to the Board
- Role of the Fund’s secretariat and the procedure for selecting and/or establishing the
- Trustee arrangements and issues of fiduciary responsibility for the Fund
- Relationship between institutional arrangements of the GCF and other bodies established under the
Convention, as well as national entities
3. Operational modalities: Work under this stream will include, inter alia:
- Methods to manage the large scale of the financial resources from a number of sources and deliver
through a variety of financial instruments, funding windows and access modalities, including direct
access, with the objective of achieving a balanced allocation between adaptation and mitigation
- Modalities for contributions to the Fund
- Methods to mobilize and leverage private sector finance, both foreign and domestic
- The financial instruments that the Fund can use to achieve its priorities
- Methods to ensure a balanced allocation between mitigation and adaptation
- Mechanisms to ensure the provision of appropriate expert and technical non-binding advice,
including from relevant thematic bodies established under the Convention
- Mechanisms to ensure stakeholder input and participation
4. Monitoring and Evaluation: Work under this stream will include, inter alia:
- A mechanism to ensure periodic independent evaluation of the Fund’s performance
- Mechanisms to ensure financial accountability and to evaluate the performance of activities
supported by the Fund, in order to ensure the application of environmental and social safeguards, as
well as internationally accepted fiduciary standards and sound financial management to the
There was clear support among members for a strong Technical Support Unit (TSU). The TSU took up its
work in the first week of May and is housed by the UNFCCC secretariat in Bonn.
Next steps include a workshop in late May/early June in Bonn and a second meeting of the Transitional
Committee scheduled for early July.