REDD Initiatives and Governance

Florence Daviet

World Resources Institute

January 22, 2010

Overview

• What we mean by “good governance” in

relation to REDD

• Governance elements in 4 REDD+ spaces

– Program development– Program development

– Common elements

• Links to MRV

Thinking about the Balance

International Governance

- UNFCCC

- World Bank’s

Forest Carbon

Domestic Governance

Forest Carbon

Partnership

Facility

- US Legislation

- Amazon Fund

Leveraging Governance

• Plan with process, including for process for governance issues

• Transparent / • Upfront Criteria/

Financing• Independent

International redress

• Transparent / trusted financial institution/ mechanisms

• Transparent MRV system beyond carbon

• Redress mechanism

Eligibility

• Upfront Criteria/ Fund of specific types of activities

• Clear definition of “Emission Reduction” quality

• Support for multiple actors

redress mechanism with consequences

• Independent MRV (domestic/ international)

Safeguards

Governance of Forest: A Definition

Revenues Revenues Revenues Revenues

IncentivesIncentivesIncentivesIncentives

GOVERNANCE COMPONENTS

Actors Rules Practice

Transparency

Government

Forest expertise of the

national budget authority

Civil society

Capacity to work on forest

revenue issues

Private Sector

Financial transparency of

forest resource companies

Legal/Policy Framework for Forest Fiscal

Management

Roles and Responsibilities for fiscal

management

Forest revenue sharing mechanisms

Legal requirements for fiscal transparency

Forest Charge System

Effectiveness of the forest charge system

Quality of processes to set forest charges

Forest Fiscal Management

Effective accounting system for

public spending

Effective accounting system for

revenue collection

Comprehensive and timely

reporting on fiscal activity

Transparent management of

resource funds

Internal controls and auditing of

fiscal activity

Participation

PR

INC

IPLE

S O

F G

OO

D

forest resource companies

Environmental policies of

lending institutions

Economic Incentives

Effectiveness of economic incentives in

the forest sector

Quality of processes to set economic

incentives in the forest sector

Consideration of the environmental

impacts of non-forest sector economic

incentives

Forest Agency Budget Process

Transparency of the annual budget

process

Quality of legislative oversight

fiscal activity

External auditing of fiscal activity

Implementation of the

Forest Charge System

Effective administration and

enforcement

Public awareness of forest charges

Implementation of Incentive

Programs

Effective administration and

enforcement

Transparent system to record

payments

Monitoring of impacts and

effectiveness

Accountability

Coordination

Capacity

PR

INC

IPLE

S O

F G

OO

DG

OV

ER

NA

NC

E

Sample Indicator: Transparent Management of Resource Funds

Elements of Quality:

• Clarity over who manages the fund

• Broad stakeholder participation to determine spending priorities

• Clear and publicly available rules to guide • Clear and publicly available rules to guide spending

• Fiscal information regularly presented to the legislature and public

• Annual external auditing with publicly accessible reports

• Regular and publicly accessible reports on impacts of fund spending

UNFCCC “Good Governance” LanguageSafeguards

• Full and effective participation of relevant stakeholders, including in particular indigenous peoples and local communities when developing “plans” and “taking mitigation actions”

• Transparent and effective national forest governance structuresstructures

• Respect for the knowledge and rights of indigenous peoples and members of local communities

Request for parties to have:

• Transparent national forest monitoring systems

• Action plans that address … land tenure issues, forest governance issues, gender considerations, safeguards and ensuring the full and effective participation of relevant stakeholders, inter alia, indigenous peoples and local communities

• Will have the institutional capacity to reduce emissions from deforestation, including strong forest governance and mechanisms to equitably distribute deforestation resources for local actions; and a land use or forest sector strategic plan

ELIGIBLE COUNTRIES

• in a manner that gives due regard to the rights and interests of local communities, indigenous peoples, forest-dependent communities, and vulnerable social groups;

ACTIVITY is designed, How does this get vulnerable social groups;

• with consultations with, and full participation of, local communities, indigenous peoples, and forest-dependent communities, in affected areas, as partners and primary stakeholders, prior to and during the design, planning, implementation, and monitoring and evaluation of activities; and

• with equitable sharing of profits and benefits derived from offset credits with local communities

designed, carried out,

and managed

• Repeats above languageProtection of interests

How does this get

implemented?

World Bank Forest Carbon Partnership Facility

• Transparent and clear stakeholder process/clear roles and responsibilities/ coordination

• Identify the underlying causes of deforestation and forest degradation, considering… governance issues

• Governance quick assessment w/ independent assessment

• Identify governance issues related to the implementation of specific activities

Identification of governance in

developing and implementing

the R-PP

R-PP development: reviewed by Technical

Advisory Panel, Bank Staff, Participant’s

Committee, other s including civil society,

domestic and international.

Unclear process in terms addressing issues

discussed, bank not the gate keeper of

‘readiness’

• Involuntary Resettlement

• Indigenous Peoples

• Forests

• Environment

World Bank Safeguards

(backed by the Inspection Panel)

• Consultation: Develop a consultation plan

• Environmental and Social Impacts: Assess Impact of readiness package and policies and measures described within

StrategicEnvironmental

and Social Assessment

Undertaken by the Bank with in country

mission. May not be a formal bank policy,

questions about accountability

Inspection Panel triggered by complaints.

Questions about application to R-PP process

and more generally when “safeguards” are

triggered. Consequences?

FCPF Guidance questions

Consider a discussion of the following questions and issues, and present a proposed work program to address them via analytic studies or other approaches to be undertaken:

• Who owns the carbon? Is there a relationship between carbon ownership and land tenure?

• How would the REDD revenues generated by these transactions be assigned and/or shared?

• What could be the checks and balances to be included in the • What could be the checks and balances to be included in the implementation framework to ensure transparency, accountability and equity?

• How could stakeholders be engaged in the implementation framework and the establishment of robust mechanisms for independent monitoring, assessment and review?

• What other institutional and governance reforms might be needed (e.g., anti-corruption laws and measures, national best practices for fiscal transparency, clarifying roles and responsibilities within a decentralized forest management system, etc.)?

Amazon FundActivity approval based on several plans

1. The Sustainable Amazon Plan

2. The Action Plan for Prevention and Control of the Legal Amazon Deforestation (PPCDAM).

3. State plans being considered where they follow the federal components (1) territorial planning, (2) monitoring and control, (3) production activities, (4) federal components (1) territorial planning, (2) monitoring and control, (3) production activities, (4) governance.

Multi-stakeholder management by the Amazon Fund Guidance Committee (COFA). They:

1. Set the fund guidelines and follow up on results

2. Ensure activities are adequate regarding the goals, commitments and policies of the plans

Initial Governance Requests

Common best practice:

Plans with multi-stakeholder participation

MRV of emission reductions – although

transparency not emphasized in all casestransparency not emphasized in all cases

Safeguards – although implementation still a big

question

Some discussion about sharing of benefits, most

clear in US language

Process or output MRV?

Participation in REDD policy discussion

Process: Participation in

Tracking of financial flows made in

relation to the plan

Process: Transparency of

Tracking improvement in

livelihoods

Process: Ability of Participation in

identifying strategies and

activities

Output: Accepted law/ policy

Transparency of information. Clear

accountability mechanism

Output: Actual transfers of financing

Process: Ability of local communities to feedback into political process

Output: Increased income in

communities

Thank You