Document of The World Bank FOR OFFICIAL USE ONLY Report No: 39592- GLB PROJECT APPRAISAL DOCUMENT ON A PROPOSED TRUST FUND GRANT FROM THE GLOBAL ENVIRONMENT FACILITY IN THE AMOUNT OF US$20 MILLION TO CONSERVATION INTERNATIONAL FOR A SECOND CRITICAL ECOSYSTEM PARTNERSHIP FUND PROJECT (CEPF-2) November 8,2007 Rural Development, Natural Resources and Environment Sector Unit Sustainable Development Department East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance o f their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
Transcript
Document o f The World Bank
FOR OFFICIAL USE ONLY
Report No: 39592- GLB
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED TRUST FUND GRANT FROM THE GLOBAL ENVIRONMENT FACILITY
IN THE AMOUNT OF US$20 MILLION
TO
CONSERVATION INTERNATIONAL
FOR A
SECOND CRITICAL ECOSYSTEM PARTNERSHIP FUND PROJECT (CEPF-2)
November 8,2007
Rural Development, Natura l Resources and Envi ronment Sector Unit Sustainable Development Department East Asia and Pacific Region
This document has a restricted distribution and may be used by recipients only in the performance o f their official duties. I t s contents may not otherwise be disclosed without World Bank authorization.
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CURRENCY EQUIVALENTS
Currency Unit = US$1
FISCAL YEAR July 1 - June 30
ABBREVIATIONS AND ACRONYMS
AFD Agence Franqaise de DCveloppement CABS CAS Country Assistance Strategy CBD Convention on Biological Diversity CEPF Critical Ecosystem Partnership Fund C I Conservation International EA Environmental Assessment GEF Global Environment Facility GEFSEC GEF Secretariat IA Implementing Agency IBA Important Bird Area IBRD MDG Millennium Development Goals METT Management Effectiveness Tracking Tool MSP Medium-sized Project NGO Nongovernmental organization O.P. Operational Program P A Protected Area PDF Project Development Facility PMO Project Management Office PRA Participatory Rural Appraisal PRSP Poverty Reduction Strategy Paper RAF Resource Allocation Framework RIT Regional Implementation Team SGP Small Grants Program SIDS Small Island Developing States SP1, SP2, SP4 GEF Strategic Priorities 1,2 and 4 STAP Scientific and Technical Advisory Panel WB World Bank WWF World Wide Fund for Nature
Center for Applied Biodiversity Science
International Bank for Reconstruction and Development
V i ce President: Sector Director:
Sector Manager: Rahul Raturi, EASRE Task Team Leader:
James W. Adams, EAPVP James Warren Evans, ENV
Kathy MacKinnon, ENV
FOR OFFICIAL USE ONLY
G L O B A L Second Critical Ecosystem Partnership Fund Project
CONTENTS
Page
A . STRATEGIC CONTEXT AND RATIONALE ................................................................. 1 Country and sector issues .................................................................................................... 1
Rationale for Bank involvement ......................................................................................... 2 Higher level objectives to which the project contributes .................................................... 3
1 . 2 . 3 .
B . PROJECT DESCRIPTION ................................................................................................. 4 Lending instrument ............................................................................................................. 4
Project development objective and key indicators .............................................................. 4
Project components ............................................................................................................. 5 Alternatives considered and reasons for rejection .............................................................. 9
1 . 2 . 3 . 4 .
C . IMPLEMENTATION ........................................................................................................ 10 Partnership arrangements .................................................................................................. 10
Institutional and implementation arrangements ................................................................ 11
Monitoring and evaluation o f outcomes/results ................................................................ 11
Sustainability and Replicability ........................................................................................ 12
Critical r isks and possible controversial aspects ............................................................... 14
Loadcredit conditions and covenants ............................................................................... 15
1 . 2 . 3 . 4 . 5 . 6 .
D . APPRAISAL SUMMARY ................................................................................................. 16 1 . Economic and financial analyses ...................................................................................... 16
7 . Policy Exceptions and Readiness ...................................................................................... 18
Annex 1: Country and Sector or Program Background ......................................................... 19
Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 25
This document has a restricted distribution and may be used by recipients only in the performance o f their off icial duties . I t s contents may not be otherwise disclosed without Wor ld Bank authorization .
Annex 3: Results Framework and Monitoring ........................................................................ 27
For Loans/Credits/Others: Total Bank financing (US$m.): 20.00 from GEF
Borrower: Conservation International 201 1 Crystal Drive, Suite 500 Arlington VA United States 2400 Tel: 1-703-34 1-2400 Fax: 1-703-553-072 1 cep [email protected] www.cepf.net
Responsible Agency: Conservation International 1919 M Street NW
Suite 600 Washington D C United States 20036 Tel: 1-202-912-1808 Fax: 1-202-912-1045 cep [email protected] www.cepf.org
Project implementation period: Start February 25,2008 End: December 3 1,2012 Expected effectiveness date: February 18, 2008 Expected closing date: April 30,2013
[ ]Yes [XINO Does the project depart from the CAS in content or other significant respects? Re$ PAD A.3 Does the project require any exceptions from Bank policies? Re$ PAD D. 7 Have these been approved by Bank management?
[ ]Yes [XINO [ ]Yes [XINO
I s approval for any pol icy exception sought from the Board? Does the project include any critical r isks rated “substantial” or “high”? Re$ PAD C.5 Does the project meet the Regional criteria for readiness for implementation? Re$ PAD D. 7 Project development objective Re$ PAD B.2, Technical Annex 3 The Project Development Objective i s to strengthen the involvement and effectiveness o f c iv i l society in contributing to the conservation and management o f globally important biodiversity.
[ ]Yes [XINO
[ ]Yes [XINO
[XIYes [ ] N o
Global Environment objective Re$ PAD B.2, Technical Annex 3 The Global Environment Objective is to achieve sustainable conservation and integrated ecosystem management in areas o f globally important biodiversity, through consolidating Conservation outcomes in existing CEPF regions and funding to new critical ecosystems.
Project description [one-sentence summary of each component] Re$ PAD B.3., Technical Annex 4 Component 1. Strengthening Protection and Management o f Globally Significant Biodiversity. CEPF-2 would support activities that strengthen management and address threats to biodiversity across broad landscapes that include a matrix o f land uses, including protected areas, biological corridors and high value conservation sites in production landscapes.
Component 2: Increasing Local and National Capacity to integrate Biodiversity Conservation into Development and Landscape Planning. CEPF-2 would support activities to integrate biodiversity conservation in production landscapes and sectors, including enabling c iv i l society
groups to plan, implement and influence biodiversity outcomes as effective partners in sustainable development.
Component 3 : Monitoring and Knowledge Sharing. This component would support monitoring and evaluation o f individual projects and programs as wel l as deriving and sharing lessons learned within and across hotspots.
Component 4. Ecosystem Profile Development and Project Execution. This component would support three subcomponents: a) the development o f ecosystem profiles, b) the role o f Regional Implementation Teams as an extension service and in grant- making and c) overall execution and administration o f the global program by Conservation International, through the CEPF Secretariat.
The GEF Grant wil l be used solely to fund subprojects under components 1 and 2.
Which safeguard policies are triggered, if any? Re$ PAD D. 6, Technical Annex 10-A Forests (OP/BP 4.36) - Pol icy i s triggered, but not applied. Indigenous Peoples (OP/BP 4.10) - Yes Involuntary Resettlement (OP/BP 4.12) - Yes
The project has an environmental assessment o f C.
Significant, non-standard conditions, if any, for: Re$ PAD C.6 Board presentation: None
Loadcredit effectiveness: This Agreement shall become effective on the date that evidence in form and substance satisfactory to the IBRD shall have been furnished to the IBRD demonstrating that:
a. the Donor Council has approved the hnd-raising strategy referred to in Section 5.01 o f the Financing Agreement;
b. the Donor Council has approved an indicative l i s t o f Biodiversity Hotspots selected for investment under the Fund;
c. the Donor Council has approved the revised Operational Manual; d. C I has established an internal audit fbnction, with staffing, resources and functions based
on terms o f reference satisfactory to IBRD; and e. Execution and delivery o f the Agreement on behalf o f C I has been duly authorized by al l
necessary corporate action and, upon execution and delivery, the Agreement shall constitute the legal, valid, binding and enforceable obligation o f each Party hereto.
Covenants applicable to project implementation: Dated Covenant:
a. Adoption o f TOR for external audit acceptable to the Bank, within 120 days o f project effectiveness.
b. Agreement on TOR for program audit to assess economy, efficiency and effectiveness in relation to achieving the CEPF objectives, within 12 months o f project effectiveness.
c. Completion o f a program audit o f CEPF by the internal auditor within 24 months o f project effectiveness.
A. STRATEGIC CONTEXT AND RATIONALE 1. Country and sector issues
1. Earth’s biologically richest ecosystems are also the most threatened. Together these “biodiversity hotspots” harbor more than 75 percent o f the most threatened mammals, birds, and amphibians yet they have already lost 86 percent o f their original habitat.’ These critical areas for conservation are also home to millions o f people who are highly dependent o n healthy ecosystems for their livelihoods and well-being.
2. In response to the growing threats to species and habitats, the Critical Ecosystem Partnership Fund (CEPF) was launched in 2000 to provide strategic assistance to engage non-governmental organizations (NGOs), community groups, and other c iv i l society partners in conserving Earth’s biodiversity hotspots. CEPF is a partnership between Conservation International (CI), the Global Environment Facility (GEF), the World Bank (Development Grant Facility), the Government o f Japan, and the John D. and Catherine T. MacArthur Foundation. In March, 2007 the Agence Franqaise de De‘veloppement (AFD) joined the program as the sixth partner.
3. The hotspots approach to conservation i s a highly targeted strategy for tackling the challenge o f biodiversity loss at the global level. As many hotspots cross national borders, the approach transcends political boundaries and fosters coordination and joint efforts across large landscapes for local and global benefits. During i t s first phase, CEPF established active grant programs in 15 regions within 14 hotspots, with spending plans authorized for more than $100 million. By the end o f March 2007, CEPF had committed $89.8 mi l l ion in grants to more than 600 c iv i l society groups in 33 countries in South and Central America (4 hotspots, $28.9m), Afr ica and Madagascar (5 hotspots, $28.8m), the Caucasus ($7m), and East Asia (4 hotspots, $25.lm). By December, 2006, grant programs in nine o f these hotspots closed after five years o f implementation. Each grant awarded helps implement a region-specific investment strategy developed together with diverse stakeholders and approved by a council o f high-level
j representatives from each CEPF donor institution. Grant recipients range from small farming cooperatives to local and international NGOs. Achievements include more effective management o f 20 mi l l ion hectares o f protected areas, including creation o f more than nine mi l l ion hectares o f new protected areas; promotion o f biodiversity-friendly management o f forests and agricultural crops; strengthened community management o f natural resources and key habitats; successful pi lot ing o f new financing mechanisms, including payments for ecosystem services and successful interventions by c iv i l society to influence development decisions.
4. A 2005 independent evaluation o f the CEPF global program was very positive and recommended that the donors seek further expansion opportunities (Annex 17). Current CEPF funding from the Wor ld Bank and GEF finished in mid 2007; the project was rated satisfactory in the Implementation Completion Report. Although the CEPF program has been shown to be highly effective, there are s t i l l significant conservation needs, both in the 14 hotspots already targeted and in other critical ecosystems that have not yet benefited under the CEPF program. In several hotspots, investments only targeted selected regions, while other areas within the hotspot also have major conservation needs. Moreover, in 2005, based on new research by
The 30 hotspots eligible for Bank support are l isted in Annex 1. 1
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nearly 400 experts, C I revised the number o f hotspots up from 25 to 34, o f which 30 are eligible for Bank and GEF support - see Annex 1.
5. The proposed project would support a second phase o f the global CEPF program to expand and replicate successful c iv i l society implementation models more broadly within at least 14 o f the 30 eligible hotspots, including at least nine new ones. I t would build on the lessons learned under the first phase o f CEPF, as wel l as recommendations f rom the independent evaluation to further strengthen the program in existing hotspots and to expand activities to marine ecosystems and to new hotspots. By focusing on a small number o f critical ecosystems, and expanding into at least nine new hotspots, the project would maximize overall impact. The program can also serve as a mechanism to direct other donor investments to the hotspots.
6. Expected global benefits wil l arise from the increased participation and capacity o f national and local c iv i l society groups to manage and deliver conservation initiatives in a strategic and effective manner and to integrate biodiversity conservation into development and landscape planning in regions o f recognized global importance. These interventions are expected to lead to generation, adoption, adaptation, and application o f lessons for improved conservation outcomes, relevant both to CEPF and the broader Bank and GEF biodiversity portfolios as wel l as to other small- and medium-size grant programs.
2. Rationale for Bank involvement
7. The World Bank has a long commitment to biodiversity conservation both through lending to client countries and as an Implementing Agency o f the GEF. Over the last 15 years, the Bank has supported more than 500 biodiversity projects, including both protected area projects and projects which support more sustainable natural resource management. The number o f biodiversity projects and projects with biodiversity components has increased steadily each year, with GEF accounting for approximately 40% o f the funding and IBRD and IDA contributing 29% each to the overall portfolio. Many o f these projects have been large scale and government-led, though GEF Medium-sized projects (MSPs) have enabled more involvement o f international NGOs and a few national NGOs.
8. This project would complement these efforts by:
Providing a streamlined mechanism for capacity building and engagement o f a wide range o f local c iv i l society actors, including local NGOs, community groups, Indigenous Peoples, and the private sector, many o f whom are outside the reach o f traditional funding mechanisms. . Supporting projects that combine community development and livelihood opportunities with small, but effective, conservation initiatives to promote environmental sustainability . Promoting an ecosystem approach to conservation through strategic investment planning so that individual grants contribute to overall conservation targets
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. Targeting new CEPF programs to complement and add value to activities supported by the Bank and other donors, including support to client countries under the new Resource Allocation Framework (RAF) adopted by the GEF. . Deriving and disseminating good practice for greater involvement o f c iv i l society in biodiversity and natural resource management, through local capacity building and testing new management models and incentives.
9. Under the hotspot approach, more than 90 countries could qualify for CEPF support. Thus CEPF has the potential to be able to complement conservation efforts in those Bank client countries with modest conservation funding, and to focus resources to innovative c iv i l society and private sector conservation efforts that may not otherwise be supported. Expansion into marine ecosystems would also expand the opportunities for small island developing states (SIDS).
10. The CEPF program is a unique example o f a global partnership that l i n k s the comparative strengths o f the Bank with bilateral agencies, leading conservation NGOs and private foundations within a common approach to build a powerful biodiversity fund. The emphasis on empowerment o f c iv i l society promotes strong local ownership, good environmental governance, effective national and local institutions and more efficient and cost-effective delivery o f global and national benefits.
3. Higher level objectives to which the project contributes
11. This i s a global program designed to address biodiversity loss in Bank client countries that have ratified the Convention on Biological Diversity (CBD). In many countries CEPF activities would complement national priorities identified in environment strategies, CAS and PRSPs to promote sound natural resource management and sustainable development linked to protection o f ecosystem goods and services. Prior to implementation each ecosystem profile would be endorsed by the relevant national GEF Focal Points to ensure consistency with country biodiversity priorities, as outlined in national Biodiversity Action Plans. Additional cofinancing at the regional and national levels will also be actively sought.
12. GEF Operational Strategy/program objective addressed by the project. The project supports the objectives o f the Strategic Priorities o f the Biodiversity Focal Area and specifically supports SP 1 (Promoting Sustainability o f Protected Area Networks) and SP 2 (Mainstreaming Biodiversity into Production Landscapes and Sectors) as well as SP 3 (Prevention, Control and Management o f Invasive Alien Species). By taking a strategic approach to conservation investments within critical ecosystems, the CEPF investments are also consistent with OP12 (Integrated Ecosystem Management). CEPF will also incorporate recent GEF Scientific and Technical Advisory Panel (STAP) guidance with respect to mainstreaming biodiversity to maximize impact, effectiveness, and replicability. Mainstreaming biodiversity considerations into management o f production landscapes that include, or affect, areas o f high conservation value i s central to the CEPF purpose.
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13.
14.
B. 1.
15.
2.
16.
17.
18.
Enhancing the capacity o f c iv i l society organizations for improved natural resource management inherently l i n k s national and global biodiversity benefits to environmental sustainability and local economic benefits.
The program is unique because o f i t s global scale and its focus o n c iv i l society participation in biodiversity conservation. I t complements other GEF investments at national level by focusing strategically on programs o f investments in regions o f highest biodiversity value. I t promotes an ecosystem approach to biodiversity conservation by supporting landscape-level conservation outcomes and transnational cross-border initiatives. The CEPF-2 project includes a specific strategy to promote cross-learning and replication, building o n lessons learned.
The CEPF-2 project i s fully consistent with, and explicitly supports, the goals and agreed work programs o f the CBD, including the protected areas work program as we l l as ecosystem- specific work programs in forests, mountain, marine, island and dryland habitats. By directing resources to the most critical and irreplaceable ecosystems, CEPF directly supports the C B D goal “to achieve by 2010 a significant reduction o f the current rate o f biodiversity loss at the global, regional and national level.” The project responds to recognized national needs to target conservation funding more efficiently and effectively through development o f strategic investment plans for critical ecosystems through a consultative and participatory process.
PROJECT DESCRIPTION Lending instrument
The CEPF i s a long-term global program with multiple donors. The CEPF-2 project would support a specific time slice o f that program, through a Grant from the GEF Trust Fund for $20 mi l l ion over five years. The CEPF-2 grant would be combined with at least $80 mi l l ion in co- funding from other donors over the same period, with al l funds managed by Conservation International.
Project development objective and key indicators
The Project Development Objective i s to strengthen the involvement and effectiveness o f c iv i l society in contributing to the conservation and management o f globally important biodiversity.
The Global Environment Objective i s to achieve sustainable conservation and integrated ecosystem management in areas o f globally important biodiversity, through consolidating conservation outcomes in existing CEPF regions and expanding funding to new critical ecosystems.
These objectives would be achieved by providing strategic assistance to locally-based NGOs, community groups, Indigenous Peoples, the private sector and other c i v i l society partners to support: a) strengthened protection and management o f biodiversity within selected hotspots and critical ecosystems, b) increased local and national capacity to integrate biodiversity conservation into development and landscape planning, and c) expanded and improved monitoring and learning to demonstrate biodiversity impact and enable adaptive management
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and replication. The CEPF program provides a field-tested mechanism for achieving these objectives, demonstrated by successful experience since its inception in 2000.
19. K e y indicators related to the project development and global development objectives are:
At least 14 critical ecosystemshotspots with investment programs involving c iv i l society in conservation, including at least nine new regions.
At least 600 NGOs and c iv i l society actors, including local community organizations and the private sector, actively participate in conservation programs guided by the CEPF ecosystem profiles.
At least 20 mi l l ion hectares o f key biodiversity areas with strengthened protection and management, including at least 8 mi l l ion hectares o f new protected areas.
At least 1 mi l l ion hectares in production landscapes managed for biodiversity conservation or sustainable use.
0
3. Project components
20. The proposed project would build upon the experiences and lessons learned in phase 1 and recommendations f rom the independent evaluation to expand the CEPF global program, including expansion into new ecosystems and hotspots. The CEPF-2 project would focus on critical ecosystems within at least 14 biodiversity hotspots in World Bank client countries that have ratified the CBD. Investment strategies for three new hotspots have already been developed and would be the first to be implemented: Polynesia-Micronesia, Indo-Burma (Indochina region); and the Western Ghats and Sri Lanka (Western Ghats region). Other ecosystems for investment would be chosen based on biodiversity status and threats, conservation needs, social and political environment, and current or planned investment by other donors. The donor partners would also review eligibility criteria to enable CEPF investment in marine ecosystems within, and adjoining, hotspots. Supplemental criteria are being developed for the CEPF Donor Council to decide whether to re-invest or exit from hotspots that have already received CEPF support.
21. The number o f hotspots approved for new investment would continue to be staggered to ensure adequate funding and implementation capacity. Total investment level per hotspot wil l vary depending on needs and local capacity. In each hotspot, disbursement o f grants will be guided by ecosystem profiles based on a stakeholder-driven prioritization process to create a shared strategy from the outset.
22. The project would include four interlinked components. GEF grant funding would be used exclusively to support Ecosystem Grants under components 1 and 2. The other donors, including CI, AFD and the John D. and Catherine T. MacArthur Foundation, wil l support a l l components.
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Component 1: Strengthening protection and management of globally significant biodiversity (Total Budget: $52.1 million; GEF $13.22 million).
23. CEPF-2 would focus on key biodiversity areas and address threats to biodiversity across broad landscapes that include a matrix o f land uses, including protected areas, biological corridors and high value conservation sites in production landscapes, including indigenous reserves, community and private lands managed for a conservation objective. Support to c iv i l society groups would contribute to the strengthened protection and management o f more than 20 mi l l ion hectares o f key biodiversity areas within hotspots, including at least 8 mi l l ion hectares o f new protected areas. Specific activities wil l be selected o n a competitive basis at the ecosystem level, as outlined in the operational manual, but could include activities under the fol lowing themes: a) strengthening management o f protected areas and other key biodiversity areas; b) community and Indigenous Peoples’ initiatives; c) innovative financial mechanisms for sustainability; and d) multi-regional priorities.
24. This component would finance c iv i l society participation in improving management and expansion o f protected areas, conservation planning, and support to communities, including indigenous groups and other partners, in management and stewardship o f biologically-rich lands that buffer key biodiversity and protected areas. Activities to strengthen or pi lot innovative financial mechanisms would also be supported.
Component 2: Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning (Total Budget: $23.9 million, GEF $6.78 million).
25, Reconciling ecosystem conservation with sustainable development o n different scales across complex jurisdictional boundaries, often in situations o f weak governance, i s perhaps the major challenge facing the conservation and development community. Mobi l iz ing c iv i l society to play a more effective role in this process is the CEPF niche. Grantees range f i om individuals, farming cooperatives and community organizations to research institutions, private sector organizations, and national and international NGOs. Many o f these groups also act as vital multipliers, hr ther building local and national capacity for conservation. A key CEPF-2 goal i s empowerment o f c iv i l society actors to take part in, and influence, decisions that affect local lives and livelihoods and, ultimately, the global environment.
26. CEPF would support activities to integrate biodiversity conservation in production landscapes and sectors, including enabling c iv i l society groups to plan, implement, and influence biodiversity outcomes as effective partners in sustainable development. Examples could include development o f community, municipal or regional land use plans, plans for local economic development, “territorial development” plans, certification for more sustainable management and private agreements. Such participation wil l build o n local knowledge and technical expertise, and leverage social capital to bring innovative ideas to solving local problems. The focal approach would be to strengthen protection o f critical biological corridors that link key biodiversity areas within a multiple use landscape, including trans-boundary collaboration to protect key areas that straddle national boundaries.
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27. This component builds upon Component 1 through strategic and effective alliances to increase impact and sustainability, especially in production landscapes. Activities to be financed include catalyzing diverse partnerships and integrated approaches, assisting in improved land-use planning and activities that mainstream conservation into management o f production landscapes, including collaboration with the private sector and informing pol icy and legislative frameworks.
Component 3: Monitoring and knowledge sharing (Total Budget: $4.5 million; no GEF allocation).
28. This component would support monitoring and evaluation o f individual projects and programs and deriving and sharing lessons learned within the hotspot. Monitoring and evaluation o f individual projects would be led by Regional Implementation Teams (RITs) and would include: a) systematic analysis and documentation o f grantees’ performance against individual project and ecosystem targets; b) assisting c iv i l society groups, including local communities and Indigenous Peoples, to engage in participatory monitoring; and c) expanding and formalizing information sharing and learning opportunities across the hotspot. Additionally this component would support specific activities to strengthen outcomes monitoring and to document, disseminate and replicate lessons learned and good practice. Previous CEPF experience with monitoring and knowledge-sharing will be scaled up under CEPF-2 to further strengthen capacity for adaptive management by CEPF partners and the broader Conservation community.
29. This component would finance technical assistance and consultant services, training for participatory monitoring, hotspot review meetings, documentation o f lessons learned, and cross-site visits for targeted training and exchange programs to promote uptake o f good practice.
Component 4: Ecosystem profile development and project execution (Total Budget: $19.5 million; no GEF allocation).
30. This component would support three subcomponents a) the development o f ecosystem profiles; b) the role o f the Regional Implementation Teams as an extension service and in grant-making; and c) overall execution and administration o f the global program by CI, through the CEPF Secretariat .
3 1. Subcomponent 4a would finance the ecosystem profiles which provide the basis for grant making and overall implementation within selected hotspots. Profile development would be led by c iv i l society partners, selected through a competitive process. For each ecosystem profile, the investment strategy wil l be based on a stakeholder-driven prioritizing process to identify conservation targets, major threats, socioeconomic factors, and current conservation investment,
32. Subcomponent 4b would finance the role o f Regional Implementation Teams (FUTs), recruited on a competitive basis (as outlined in the operational manual), to lead implementation o f the ecosystem profiles, and assist other c iv i l society groups in designing, implementing and replicating successfwl conservation activities. The RITs would have full responsibility for
7
awarding al l grants below a $20,000 threshold. RITs and local advisory groups will also play a role in deciding other grant applications (>$20,000) with the CEPF Secretariat. This subcomponent would finance technical assistance provided by the RITs, including training in grant development and implementation for local groups, and evaluating grant applications.
33. Subcomponent 4c would finance overall management and administration o f the program by C I through the CEPF Secretariat. The Secretariat i s responsible for strategic and financial management, oversight and reporting for the global program. This includes supervision o f the ecosystem profi l ing process; training and management o f the RITs; and overall ecosystem portfolio development, grant-making, compliance on safeguards issues, and monitoring and reporting under supervision o f the regional Grant Directors. The Secretariat i s also responsible for fimdraising, donor coordination, and global information management and outreach, as wel l as development and implementation o f a program-wide replication and dissemination strategy.
34. This subcomponent would finance consultant services, technical assistance, and CEPF administration costs, including program management, financial management and annual audits, organizing independent evaluations, and communications and outreach, including website management, newsletter and publication production.
4. Lessons learned and reflected in the project design
35. Lessons learned during the f i rst phase o f implementation and highlighted in the independent evaluation include:
36. Need for greater inclusiveness and transparency in decision-making. The ecosystem profiles are the primary tool for prioritizing conservation needs and planning investment strategies. Under CEPF-2 explicit efforts wil l be made to inform a l l stakeholders, including indigenous and local communities and the private sector, about the profi le process and opportunities to access grants.
3 7 . Roles of Regional Implementation Teams (RITs). Small grants programs usually require targeted efforts to access and build capacity among small local organizations. In this regard, the independent evaluation identified the regional coordination units as one o f the key strengths o f CEPF. CEPF has expanded the roles and responsibilities o f the RITs to further devolve responsibility for grant-making decisions, capacity building o f local partners and monitoring o f individual projects at the regional level. Strategic oversight would remain at the Secretariat level to maintain focus and the reporting and safeguard standards required by the CEPF donors.
3 8. Need for strengthened monitoring. Conservation outcomes are dif f icult to attribute because they usually result f rom the efforts o f numerous actors. I t i s therefore dif f icult to determine how specific CEPF investments, separately or cumulatively, contribute to outcomes within a critical ecosystem. Under CEPF-2, monitoring wil l be strengthened by developing an explicit subset o f short-term benchmarks to monitor progress in achieving identified conservation targets for each ecosystem investment profile. As recommended by the evaluation, monitoring at the portfolio level wil l also be strengthened and involve both the RITs and the CEPF Secretariat.
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39.
40.
5.
41.
42.
43.
Socioeconomic and capacity benefits. While aiming for conservation outcomes, the process and implementation o f CEPF grants generates considerable socio-economic, governance and capacity impacts. Expl ici t efforts would be made under CEPF-2 to better capture these impacts in the monitoring and evaluation frameworks at the ecosystem level through the development and testing o f new tools.
Lessons learned from other small grants programs. Experience from the Bank GEF portfolio shows that community benefits and small grants are a good way to engage a broad range o f stakeholders and elicit public support for protected areas but linking development activities to conservation outcomes remains a challenge. As part o f documentation o f lessons learned, the CEPF Secretariat and World Bank would develop a jo int work program to assess the impact and value o f small grants programs in achieving biodiversity conservation.
Alternatives considered and reasons for rejection
Hotspot Focus
CEPF-2 active in al l 30 eligible hotspots. This option was rejected in favor o f a more targeted approach so that CEPF ecosystem programs would be active in only a limited number o f hotspots at any one time to maximize impact.
CEPF-2 to focus only on “new ” hotspots that had not benefited under thefirst phase. This option was rejected since in larger hotspots, several current CEPF programs focus o n only specific sub-regions (e.g. only Sumatra in Sundaland). Thus some first phase hotspots may require additional support to consolidate conservation gains or expansion to new regions. An ini t ial indicative list o f potential hotspots for investment has been approved by the Donor Council. Investments in new regions will be phased and choices may be revised during implementation, according to emerging needs and other donor efforts.
CEPF-2 to focus only on terrestrial habitats as in phase 1. Hotspots are defined according to terrestrial biodiversity and phase 1 o f the CEPF focused on terrestrial systems. CEPF-2 would also support some conservation activities in adjacent marine and coastal habitats as part o f a more holistic approach to address agreed conservation needs and hotspot targets.
Implementation arrangements
44.
45.
CEPF to become an independent legal entity responsible only for grant-making so that C I would not have the dual role o f administering the program and being a potential beneficiary from grant funds. This option was rejected because the CEPF receives additional benefits and services from linkages with C I headquarters and regional programs and Centers for Biodiversity Conservation.
Cap on grant resources available to CI and other international organizations. Under the f i rst phase o f CEPF, C I could apply for up to 50 percent o f the total funds available globally for ecosystem grants. Over time, the C I share o f f ield grants declined to 26 percent o f the available
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46.
C. 1.
47.
48.
49.
funding (as o f March 3 1 2007), a trend that i s expected to continue. The emphasis under CEPF-2 would be to further empower and engage national and local stakeholders. Nevertheless local capacity may vary between hotspots and in some regions there may s t i l l be a substantial role for international NGOs, including CI, to take a lead in conservation projects. Rather than establish a funding cap for international NGOs, the project design incorporates measures to ensure further transparency and devolution o f effective decision-making, including steps to avoid potential conflict o f interest.
Under CEPF-2, the role of RlTs would be awarded on a competitive basis and approved by the Donor Council. All RITs, whether C I or other locally-based organizations, would be ineligible to apply for additional CEPF grant funds within those regions where they serve as the RIT. All proposed grants above $20,000 to CI, would be approved by the CEPF Working Group (grants o f $20,000 and less will be awarded directly by the RITs). The overall objective is to ensure that international organizations would not implement projects that could be successfully undertaken by local groups.
IMPLEMENTATION Partnership arrangements
CEPF i s a partnership o f CI, GEF, the World Bank, the Government o f Japan, the John D. and Catherine T. MacArthur Foundation and AFD. Partnerships are also a fundamental tenet o f the program, which focuses on building alliances and coordinated approaches between NGOs, governments, donors and other sectors to contribute to better planning o f natural resource management and conservation investments and to promote their long-term success and sustainable outcomes.
Under CEPF-2, the partnership would retain the overall structure o f a Donor Council, Secretariat and Working Group. The Donor Council, comprised o f senior representatives from each CEPF donor institution,2 reviews and approves each ecosystem profile, annual spending plans and the CEPF Operational Manual, which contains the specific operating policies and procedures o f the Fund. The Working Group, comprised o f technical experts from each donor institution, provides guidance to the Secretariat on strategy development, monitoring, and other aspects o f implementation. Members act as advisors to their respective Donor Council representatives and as CEPF focal points for their broader institutions.
Strengthening operational collaboration with the CEPF donor partners will be an explicit priority during implementation. Activities will include engaging regional and national representatives o f the partners and GEF Implementing Agencies in the planning process for each ecosystem. Each profi le would include information on programs o f the World Bank and other donors in the region to emphasize synergies and potential linkages. Mechanisms would be developed for regular sharing o f information and collaboration, and further strengthening o f synergies and cooperation with World Bank operations.
Both the GEF and World Bank are represented on the CEPF Donor Council; the SDN VP, Kathy Sierra i s Acting Chair for the CEPF Donor Council. Al l Bank GEF projects, including global projects, are mapped to a Bank region. Since two o f the f i s t three “new” hotspots fal l within East Asia and the Pacific region, the CEPF-2 project i s mapped to EASRE.
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2. Institutional and implementation arrangements
50. The CEPF implementation arrangements are designed to build on lessons learned during the first phase, to enable continued expeditious, efficient support to diverse c iv i l society groups, and to establish a clear and effective chain o f accountability for results.
5 1. C I wil l continue to administer and execute the project, through the CEPF Secretariat, o n behalf of the CEPF donors as detailed in component 4. The Regional Implementation Teams (RITs) comprised o f locally based c iv i l society groups, wil l lead implementation within the hotspots. Each application to serve as the Regional Implementation Team will be reviewed by the CEPF Working Group, with final selection by the Donor Council through an approved transparent, competitive process. The C I members o f the CEPF Working Group and Donor Council wil l not participate in the deliberations in instances where CI, i t s branch office or affiliate, i s an applicant. The RITs will be responsible for the strategic implementation o f the ecosystem profiles and building a broad constituency o f c iv i l society groups to work across institutional and geographic boundaries toward shared conservation goals. As recommended by the independent evaluation, RIT responsibilities have been standardized and expanded to devolve further responsibilities to these teams.
52. All grants wil l be awarded o n a competitive basis. The RITs wil l have direct decision-making authority for a l l grants up to $20,000. For grants above $20,000, the relevant team as wel l as CEPF Secretariat staff and other external reviewers as appropriate will be involved in decision- making within each hotspot. Grants above $250,000 would be subject to additional external technical review, including review by Bank regional staff as appropriate. Additional criteria will apply to grants to international organizations, including demonstration o f comparative advantage. International proposals designed and implemented with a local partner or incorporating strong capacity building would be given preference. C I would not be eligible for a set share o f CEPF funds but would compete for CEPF grant funding o n an equal basis with other groups. To avoid potential conflict o f interest, the individual groups that comprise the RITs, as wel l as other offices and programs o f those organizations, would not be eligible for additional grants within that particular hotspot. Applications from formal partners o f those organizations that have an independent operating board o f directors will be accepted, but subject to additional external review. All proposed grant awards over $20,000 to Conservation International will require approval on a time-bound no objection basis by the CEPF Working Group. The C I Working Group member would not participate in any aspect related to the grant submission or review and approval by the Working Group.
3. Monitoring and evaluation of outcomes/results
53. The CEPF monitoring approach would focus on monitoring and evaluation at three levels: the overall program, ecosystem and project levels. Data gathered wil l inform decisions and adaptive management o f ecosystem portfolios and also feed into outreach and documentation o f lessons learned and best practice.
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54. The independent evaluation recommended strengthening performance monitoring at a hotspot level in two specific directions: i) involving both the Grant Directors based at the CEPF Secretariat and the locally based Regional Implementation Teams in ecosystem-level analysis and reporting on a regular basis and ii) complementing the use o f conservation outcomes as long-term operational targets with the development and adoption o f socioeconomic, pol icy and c iv i l society measures and indicators to measure interim progress toward the outcomes. The proposed project incorporates both recommendations.
55. At the hotspot/ecosystem level, each ecosystem profile would set the baseline, conservation targets and indicators against which progress wil l be monitored. Priorities for a second phase o f CEPF include: i) ensuring that conservation targets and indicators are defined in al l regions that receive CEPF funding; ii) improved outcomes monitoring at the ecosystem level in al l critical ecosystems receiving funding; and iii) sharing the results widely to demonstrate biodiversity impact and enable adaptive management. Individual projects would use the GEF Monitoring tools, including the Protected Area management effectiveness tool SP1 and the GEF SP 2 tracking tools to assess the biodiversity impact o f CEPF investments. At the ecosystem level, the RIT and other local partners would lead the monitoring to further strengthen ownership and capacity so that results feed into follow-up actions.
56. Results o f monitoring at site and ecosystem levels wil l contribute to assessment o f progress in achieving the 2010 targets set by the CBD. This information wil l be calibrated against data on biodiversity status drawn from the Biodiversity Early Warning System developed by the Center for Applied Biodiversity Science at C I as wel l as data from other NGOs’ regional programs.
57. The Bank will conduct semiannual supervision missions to assess progress and provide input to overall project activities. Under CEPF-2, explicit mechanisms would be put in place to ensure greater involvement in project operations, including supervision, o f Bank regional staff from headquarters and country offices. In addition, the Bank will conduct a midterm evaluation o f project execution no later than three years after the f i rst project selection.
4. Sustainability and Replicability
58. The CEPF-2 project would contribute to ecological, institutional, social and financial sustainability.
59. Ecological sustainability. The fundamental premise o f CEPF i s that large-scale actions taken by multi-lateral institutions and national government agencies to protect biodiversity (and the ecosystems on which many economic systems depend) are more l ikely to succeed if they are both influenced and supported by c iv i l society. The CEPF-2 program would contribute to ecological sustainability in at least 14 hotspots through strategic c iv i l society actions that would complement government and other donor conservation programs. All investments at the hotspot level would be made in accordance with the strategic framework and f ive year investment plan laid out in the ecosystem profile. The project’s components and specific elements are designed to interlink, with each complementing and building upon the activities in
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the other, to contribute to sustainability o f project initiatives, influence larger pol icy and institutional framework, and ensure ecosystem conservation in the long term.
60. Social and institutional sustainability. The CEPF experience over the past five years demonstrates that the program can strengthen positive roles for c iv i l society by building long- term sk i l ls and strengthened environmental governance. When local communities are enabled to contribute knowledge about the natural systems that form the basis o f their livelihoods and can articulate their economic and cultural interests, better and more enduring decisions are likely to be made at national and international levels. A key component o f the RITs’ responsibilities would be to assess potential projects for sustainability and to build the capacity o f local actors to design and implement appropriate conservation activities. CEPF-2 would empower a wide variety o f c iv i l society actors to engage in biodiversity conservation, to acquire a positive stake in sustainable development programs, and to contribute to improved design, support, monitoring and sustainability o f those efforts. At the midterm o f investments in each profile, specific measures will be identified and put in place to ensure sufficient strengthened capacity for collaborating organizations to sustain activities beyond CEPF grants, including training in grant-making applications and information on other sources o f finance.
6 1. Financial sustainability. The CEPF is a long-term multi-donor program with different donors funding different time slices. The f i rst phase o f CEPF leveraged an additional $130 mi l l ion o f non-CEPF funds toward specific projects and c iv i l society activities within certain hotspots, thereby contributing to sustainability o f these efforts beyond CEPF involvement. Based on lessons from the f i rs t phase, CEPF-2 would also promote pi lot ing o f specific innovative financial mechanisms, including payments for ecosystem services and market transformation initiatives. Individual sub-projects are also required to consider sustainability issues.
62. The capacity o f CEPF to attract other donors, both within, and beyond, the partnership, constitutes a significant market test o f the initiative. I t is predicted that a second GEF investment in CEPF would leverage even greater additional funding, further illustrate the value o f the program and encourage other donors to contribute both during, and beyond, the period o f GEF investment. The recent commitments from AFD recognize the cost-effectiveness and utility o f the CEPF program. There i s no expectation o f GEF support beyond this second phase but i t i s expected that the overall CEPF program would continue with funding from other donors.
63. Replicability. One o f the project activities i s development and implementation o f a focused replication strategy to disseminate information on best practices and lessons learned, including i) cross-site exchanges between grantees for learning and dissemination o f best practice; ii) seminars, workshops and outreach activities to increase the uptake o f good practice, and iii) documentation and dissemination o f lessons learned by CEPF in managing a global grants program for the conservation community. Systematic information sharing, both through workshops and the CEPF website, wil l hr ther build local capacity and disseminate experiences and good practice more broadly among the conservation community.
64. Regular liaison and partnerships with national and international development agencies, relevant government agencies, and business corporations wil l emphasize good practice and the socioeconomic benefits o f fostering biodiversity conservation as part o f sustainable
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development. In particular, more regular liaison with Wor ld Bank staff wi l l be a focus to help replicate good practice within Bank operations.
5. Critical risks and possible controversial aspects
65. Risks include potential shortfalls in achieving the full $ l o o m funding target, due to changes in donor priorities, but experience from the first phase o f CEPF suggest that the expected additional co-financing wil l be secured. Economic and governance conditions, international terrorism, regional conflicts and lack o f local capacity could disrupt conservation efforts in some hotspots. Such r i sks are assessed in the preparation o f the ecosystem profiles for each hotspot and further minimized by targeting multiple countries and critical ecosystems.
66. The expected risks and their ratings are summarized in the following matrix:
Risks Expected co-financing may not be secured in full
Reduction in conservation funds in general due to changes in political priorities
Economic downturns, international terrorism, and regional conflicts could disrupt conservation activities.
Lack o f interest and/or capacity o f local organizations to serve as RITs
Risk Rating N
N
M
M
Risk Mitigation Measures $62 mi l l ion co-funding commitments achieved. C I committed to fundraising strategy to raise additional $18 million. Donor Council approval o f profiles and annual spending plans assures investments consistent with agreed funding commitments.
CEPF i s not reliant on donor government priorities. Co-funding expected from a mix o f donors, including NGO, MDB, bilaterals and a foundation.
Investment strategies and ecosystem profiles assess risks prior to investment in any hotspot. Targeting multiple countries and critical ecosystems also mitigates this r isk.
Criteria for choice o f ecosystem would include c iv i l society capacity and/or
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Slow uptake o f funds due to l imited capacity o f local organizations
Inappropriate use o f grant funds due to weak capacity and inexperience o f local organizations
Overall risk rating
N
M
presence o f capable international NGO.
Levels o f investment will be based o n assessment o f capacity o f locally-based organizations. RITs engaged to assist and train local organizations.
RITs monitor to ensure compliance and appropriate financial management.
M
Risk Rating: H (High risk), S (Substantial Risk), M (Modest Risk), N (Negligible or L o w Risk)
6. Loadcredit conditions and covenants
Effectiveness conditions:
This Agreement shall become effective on the date that evidence in form and substance satisfactory to the IBRD shall have been furnished to the IBRD demonstrating that:
a. the Donor Council has approved the fund-raising strategy referred to in Section 5.01 o f the Financing Agreement;
b. the Donor Council has approved an indicative l i s t o f Biodiversity Hotspots selected for investment under the Fund;
c. the Donor Council has approved the revised Operational Manual; d. C I has established an internal audit function, with staffing, resources and functions based
on terms o f reference satisfactory to IBRD; and e. Execution and delivery o f the Agreement on behalf o f C I has been duly authorized by al l
necessary corporate action and, upon execution and delivery, the Agreement shall constitute the legal, valid, binding and enforceable obligation o f each Party hereto.
Dated Covenants:
a. Adoption o f TOR for external audit acceptable to the Bank, within 120 days o f project effectiveness.
b. Agreement on TOR for program audit to assess economy, efficiency and effectiveness in relation to achieving the CEPF objectives, within 12 months o f project effectiveness.
c. Completion o f a program audit o f CEPF by the internal auditor within 24 months o f project effectiveness.
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D. APPRAISAL SUMMARY 1. Economic and financial analyses
67. For a complete Incremental Cost Analysis, refer to Annex 15. Incremental costs wil l also be calculated for each ecosystem profile.
2. Technical
68. The ecosystem profiles prepared for each hotspot are the main planning tool for prioritizing conservation needs and strategies. These profiles are based on wide consultation and scientific and technical input from stakeholders within the region. The Donor Council reviews and approves the profiles and proposed levels o f investment. This review involves the Working Group and provides an opportunity for additional review by Bank staff representing the regions, both at headquarters and in country offices.
3. Fiduciary
69. Financial management. The f i rst phase o f CEPF already has financial management systems in place that meet Bank financial management requirements, e.g. financial and programmatic risk assessments and an anti-terrorism screening process. The Bank has conducted an updated assessment to ensure the adequacy o f financial management as stipulated in BP/OP 10.02.
70. Procurement. CEPF already follows Bank procedures for procurement. The CEPF Operational Manual sets out templates for grant agreements and procurement provisions. I t wil l be revised and updated as needed, as a condition o f project effectiveness.
4. Social
71. W h i l e this project principally aims to improve the conservation and management o f biodiversity, i t would also support projects that enhance livelihoods, ecosystem services and economic benefits for local people and provide incentives to participate in sustainable management o f natural resources. Specific measures o n social safeguards issues have been incorporated in the Operational Manual to address potential impacts o n local communities and Indigenous Peoples, including development o f an Indigenous Peoples Planning Framework and a Process Framework for Involuntary Restrictions. These frameworks wil l be available on the CEPF website and Bank Infoshop.
5. Environment
72. The CEPF-2 project has been assigned a category o f C. Despite this overall categorization, al l individual CEPF projects have to be screened for safeguards and appropriate mitigation taken as needed; the process i s la id out in the Operational Manual.
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6. Safeguard policies
73.
74.
75.
76.
77.
Safeguard Policies Triggered by the Project Yes N o Environmental Assessment (OPBP 4.01) [ XI [I Natural Habitats (OPBP 4.04) [I [XI Pest Management (OP 4.09) [I [XI Cultural Property (OP 4.1 1) [I [XI Involuntary Resettlement (OPBP 4.12) [XI [I Indigenous Peoples (OPBP 4.10) [XI [ I Forests (OP/BP 4.36) [XI [I Safety o f Dams (OPBP 4.37) [ I [XI Projects in Disputed Areas (OPBP 7.60)* [I [XI Projects on International Waterways (OPBP 7.50) [I [XI
Environmental Assessment. The CEPF-2 project wil l address priori ty Conservation objectives. Project activities will be selected on a competitive basis according to criteria that wil l ensure that resources are directed to addressing conservation needs while ensuring minimum adverse environmental effects. All project proposals wil l be screened for safeguard issues.
Natural Habitats. By design, CEPF would finance activities that promote conservation o f natural habitats. All project activities will be consistent with conservation priorities. I t i s anticipated that any activity funded by CEPF would be consistent with existing protected area management plans or other resource management strategies that are applicable to local situations. Beyond the selection criteria for identifying project activities, i t i s not anticipated that any additional measures wil l be required under this policy.
Forestry. The Project fully complies with the Bank’s Forest Policy. Project activities wil l focus on conservation and more sustainable management o f forests. Beyond the selection criteria for identifying project activities, i t i s not anticipated that any additional measures wil l be required under this policy.
Involuntary Resettlement. I t i s possible that sub-projects may restrict access to resources through enforcement o f protection measure. In cases where sub-projects could lead to restrictions in access to resources, proponents must demonstrate that they have followed an appropriate process framework to establish off-setting management or compensation measures.
Indigenous Peoples. Many o f the world’s remaining areas o f high biodiversity overlap with lands occupied and utilized by Indigenous Peoples. Individual project activities would be selected at the ecosystem level but it i s expected that Indigenous Peoples, as wel l as other c iv i l society actors, will participate in identifying conservation priorities and have access to CEPF grants. Some CEPF-funded activities could potentially impact indigenous communities, either positively or adversely, depending on the nature o f actions on the ground. Projects proposed for CEPF funding should demonstrate that they have made provisions for evaluating the potential impacts on indigenous communities and site-specific action plans may be required.
* By supporting the proposedproject, the Bank does not intend to prejudice the final determination of the parties’ claims on the disputed areas
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For more information on safeguard measures see Annex 10.
7. Policy Exceptions and Readiness
78. The project i s designed fully consistent with Bank policies and no exceptions to pol icy are required.
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Annex 1: Country and Sector or Program Background
GLOBAL: Second Critical Ecosystem Partnership Fund Project
1. The Mil lennium Ecosystem Assessment showed that over the past 50 years, human activities have changed ecosystems more rapidly and extensively than at any comparable period o f time in human history, largely to meet growing demands for food, fresh water, timber, fiber and fuel. This has resulted in a substantial and largely irreversible loss o f biodiversity. These changes have contributed too many net gains in human wel l being and economic development but have been achieved at growing environmental costs, biodiversity loss and the exacerbation o f poverty for some groups o f people. The degradation o f ecosystem services could grow significantly worse during the f i rst hal f o f this century and i s a barrier to achieving the Mil lennium Development Goals (MDGs). Unless addressed, these problems wil l substantially diminish future options and the ecosystem goods and services available to future generations.
2. Earth’s biologically richest ecosystems are also the most threatened. Together, these “biodiversity hotspots” harbor more than 75 percent o f the most threatened mammals, birds, and amphibians yet they have already lost 86 percent o f their original habitat. In response to these growing threats, the Critical Ecosystem Partnership Fund (CEPF) was launched in 2000 to provide strategic assistance to engage NGOs, community groups, and other c iv i l society partners in conserving biodiversity hotspots. The CEPF is a partnership program, with different donors committing resources against different timelines. The f i rst phase o f the CEPF involved CI, GEF, the World Bank, the Government o f Japan, and the John D. and Catherine T. MacArthur Foundation, each committing $25 mi l l ion for a total o f US$125 mi l l ion in grant funding towards a program that targeted 14 hotspots. The first phase o f GEF funding and World Bank DGF funding wil l be completed in mid-2007. In March 2007 the Agence Franqaise de DCveloppement (AFD) joined the partnership as a sixth donor.
3. By the end o f 2006, grant programs in nine o f the original hotspots closed after five years o f implementation. A 2005 independent evaluation o f the CEPF global program recommended that the donors expand the program. Although the CEPF program has been shown to be highly effective, there are s t i l l significant conservation needs, both in the first phase hotspots and in other critical ecosystems that have not yet benefited from CEPF. Moreover in 2005, based o n new research by nearly 400 experts, Conservation International revised the number o f hotspots up to 34, o f which 30 are eligible for Bank and GEF support - see matrix below.
4. The proposed project i s a second phase project that would replicate and expand successful c iv i l society implementation models for biodiversity conservation. I t would build on the lessons learned under the f i rs t phase o f CEPF as well as recommendations f rom the independent evaluation to further strengthen the program and to expand activities to marine ecosystems and new hotspots. I t would complement government-led conservation efforts, by providing a streamlined and agile mechanism for capacity building and engagement o f a wide range o f local c iv i l society actors, including local community groups, Indigenous Peoples, NGOs and the private sector, many o f whom are outside the
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reach o f traditional funding mechanisms. By focusing on a small number o f critical ecosystems the project would maximize overall impact.
5. The conservation and sustainable use o f natural ecosystems and biodiversity are critical elements that support sectors as diverse as agriculture, forests, fisheries and water management. Lessons learned from the Bank partnership with the CEPF are relevant to enhanced natural resource management and especially community driven development projects that are attempting to achieve enhanced livelihoods, poverty alleviation and environmental sustainability. These interventions are expected to lead to generation, adoption, and application o f lessons related to improved biodiversity outcomes, relevant both to CEPF and the broader Bank and GEF biodiversity portfolios as wel l as to other small- and medium-size grant programs.
6. The CEPF framework i s consistent with the Bank’s emphasis on partnerships to deliver development outcomes. CEPF is a unique global partnership that l i n k s the comparative strengths o f the Bank with bilateral agencies, leading conservation NGOs and private foundations within a common approach to build a powerful biodiversity fund to support c iv i l society involvement in conservation activities. The emphasis o n empowerment o f c iv i l society promotes strong local ownership, good environmental governance, effective national and local institutions and more efficient and cost-effective delivery o f global and national environmental benefits. To ensure consistency with government priorities, each ecosystem profile requires endorsement by the relevant GEF Focal Points prior to implementation at a national level.
CEPF-2 Project: Indicative List of Hotspots with Countries Eligible for World Bank and GEF Funding.
Critical Ecosystem (Hotspot)
Atlantic Forest
California Floristic Province **
CEPF-2 WBIGEF Eligible
Countries *
Argentina, Brazil, Paraguay
Conservation Significance
40% o f plants (8,000), 27.3% o f mammals, 15.4% o f birds, 30.2% o f reptiles, 61.8% o f amphibians, and 38% o f fishes are endemic. Endemism in trees i s particularly high, wi th more than hal f the species endemic.
Mexico 61% o f plants (2,124), 12% o f mammals, 2.4% o f birds, 6% o f reptiles, 54% o f ampl-ubians and 21% o f freshwater fishes are endemic. O f nearly 3,500 species o f vascular plants in the hotspot, more than 2,120 (61%) are endemic.
I
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Threats
Logging, intensification and expansion o f agriculture, clearing for plantation forestry, and fragmentation.
Commercial farming, urbanization, pollution, habitat encroachment, construction, strip mining and o i l extraction, invasive alien species, livestock grazing, and suppression o f f ires.
69% o f plants (6,210), 4.4% o f mammals. 2% o f birds, 22% o f reptiles, 35% o f amphibians and 4 1 % o f freshwater fishes are endemic. The region i s the only hotspot that encompasses an entire floral kingdom.
50% o f plants (6,500), 46% o f mammals, 27% o f birds, 93% o f reptiles, 100% o f amphibians and 40% o f freshwater fishes are endemic.
25% o f plants (1,600), 14% o f mammals, .3% o f birds, 23% o f reptiles, 18% o f amphibians, 9.4% o f freshwater fishes are endemic.
44% o f plants (4,400), 7% o f mammals, 3% o f birds, 15% o f reptiles and amphibians, and 25% o f freshwater fishes are endemic. Of the 200 amphibian species, more than 25 are endemic.
50.3% o f plants (1,957 o f 3,892), 22% o f mammals, 5.3% o f birds, 66% o f reptiles, 71% o f amphibians, and 56% o f freshwater fishes are endemic.
44% o f plants (1,750), 5.6% o f mammals, 2% o f birds, 2 1 % o f reptiles, 7% o f amphibians, and 15% o f freshwater fishes are endemic.
31% ofplants (2,356 of7,598), 21% o f mammals, 8% o f birds, 27% o f reptiles, 30% o f amphibians, and 69% o f freshwater fished are endemic.
Agriculture expansion, population growth, invasive alien plant species and ecosystem degradation.
Deforestation, Agriculture (cacao, coffee, sugar cane and tobacco plantations), mining, tourism, and invasive alien species.
Logging, fuel wood consumption, illegal hunting, pollution, and overgrazing by livestock.
Agriculture, ranching, charcoal harvesting, drought, and infrastructure.
Overgrazing, invasive species, accidental and intentional forest fires, population growth and urbanization. Agriculture, urbanization, lack o f legal protection, wildlife-human conflicts and pressure on forest resources.
Agriculture, logging, fires, mining, infrastructure development, and collection o f firewood andor plants for medicinal use, hunting and disease.
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East Melanesia Islands
Forests West Africa
Himalayas I- Horn o f Africa r
Indo-Burma
Irano- Anatolian I I
Madagascar and Indian
Ocean Islands**
Papua New Guinea, the
Solomon Islands, Vanuatu
Benin, Cameroon, C6te
d'Ivoire, Equatorial
Guinea, Ghana, Liberia, Nigeria, Sao Tome and
Principe, Sierra Leone, Togo
Bhutan, China, India,
Nepal, Pakistan (Myanmar),
Djibouti, Eritrea,
Ethiopia, Kenya,
(Somalia), Sudan and
Yemen
Bangladesh, Cambodia,
China, India, Laos, Malaysia,
Thailand, Vietnam
(Myanmar),
Armenia, Azerbaijan,
Georgia, Iran, (Iraq), Turkey, Turkmenistan
Madagascar, Comoros
Mauritius, Seychelles
37.5% o f plants (3,000 o f 8,000), 45.3% o f mammals, 4 1.4% o f birds, 46% o f reptiles, 90.5% o f amphlbians, and 5.7% o f freshwater fishes are endemic.
20% ofplants (1,800 o f 9,000), 21% o f mammals, 10% o f birds, 25% o f reptiles, 38.5% o f amphibians and 28% o f freshwater fishes are endemic.
31.6% ofplants (3,160 o f lO,OOO), 4% o f mammals, 2% o f birds, 27% o f reptiles, 40% o f amphibians, and 12.3% o f freshwater fishes are endemic.
55% o f plants (2,750 o f 5,000). 9% o f mammals, 3.4% o f birds, 33% o f reptiles, 20% o f amphibians and 10% o f freshwater fishes are al l endemic.
52% (7,000 o f 13,500) o f plants, 17% o f mammals, 5% o f birds, 39% o f reptiles, 54% o f amphibians and 44% o f freshwater fishes are endemic.
42% (2,500 o f 6,000) o f plants, 7% o f mammals, 10% o f reptiles, 11% o f amphibians, and 33% o f fresh-water fishes are endemic.
89% (1 1,600 o f 13,000) o f plants, 93% o f mammals, 58% o f birds, 96% o f reptiles, 99.6% o f amphibians, and 59% o f freshwater fishes are endemic.
Habitat loss and fragmentation o f forests, illegal logging, mining, agriculture, population growth, bush-meat hunting and trade.
Cultivation, logging, overgrazing, fuel wood, unsustainable harvest o f medicinal plants.
Overgrazing, agriculture, charcoal production, poor governance and political instability.
Agriculture, over- harvesting, logging, over-fishing, habitat loss, rapid population growth and unsustainable economic development.
Over-grazing, over- harvesting o f woody plants for fuel wood, mining. Political tensions and military operations have also resulted in the loss o f forests and wetlands.
Agricultural methods, invasive alien species, industrial and small- scale mining are growing threats.
75% o f plants, 2% o f mammals, 4% o f birds, 10% o f reptiles, 25% o f amphibians, and 21% o f freshwater fishes are endemic.
24% o f plants, 2% o f mammals, 14% o f reptiles, 15% o f amphibians, and 27% o f freshwater fishes are endemic.
52% o f plants, 11% o f mammals, 5% o f birds, 34% o f reptiles, 34% o f amphibians and 29% o f freshwater fishes are endemic.
17% o f plants, 15% o f mammals, 19% o f birds, 35% o f reptiles, 65% o f amphibians and 67% o f freshwater fishes are endemic.
27% o f plants, 4% o f mammals, 2% o f reptile 57% o f amphibians and 19% o f freshwater fishes are endemic.
29% o f plants, 2% o f mammals, 0.3% o f birds, 16% o f reptiles, 9% o f amphibians and 25% o f freshwater fishes are endemic.
66% o f plants (6,091), 61 mammals, 35 birds, 68 reptiles, 85 amphibians and 24 freshwater fishes are endemic.
58% o f plants, 75% o f mammals, 56% o f birds, 48% o f reptiles, 100% o f amphibians and 21% o f freshwater fishes are endemic.
Logging and fragmentation.
Industrial and local farming, over-grazing by livestock, timber, mining, urbanization, and invasive alien plant species.
Infrastructure, urbanization, habitat fragmentation and increasing tourism.
Deforestation, timber and mineral extraction.
Civil conflicts, dams, reservoir construction, over-fishing, and invasil alien species.
Deforestation, logging, over-grazing, i l legal hunting. High population growth rate, poverty, i l legal logging and timber, mining and land conversion.
Invasive al ien species, urbanization and commercialization, habitat degradation.
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Succulent Karoo
Sundaland
Tropical Andes
Tumbes-
Magdalena Choc6-
Wallacea
Western Ghats and Sri Lanka
Namibia, South Africa
Indonesia, Malaysia
Argentina, Bolivia, Chle,
Colombia, Ecuador, Peru,
Venezuela Colombia, Ecuador,
Panama, Peru
Indonesia, (Timor Leste)
India, Sri Lanka
38% o f plants, 3% o f mammals, 4% o f birds, 16% o f reptiles, 5 % ~ o f amphibians are endemic.
60% o f plants, 45% o f mammals, 19% o f birds, 54% o f reptiles, 80% o f amphibians and 37% o f freshwater fishes are endemic.
50% o f plants, 13% o f mammals, 34% o f birds, 45% o f reptiles, 67% o f amphbians and 35% of freshwater fishes are endemic.
25% o f plants, 4% o f mammals, 12% o f birds, 30% o f reptiles, 15% o f amphibians and 46% o f fishes are endemic.
15% o f plants, 57% o f mammals, 41% o f birds, 45% o f reptiles, 69% o f amphibians, 20% o f fishes are endemic.
52% o f plants, 13% o f mammals, 7% o f birds, 65% o f reptiles, 73% o f amphibians and 73% o f freshwater fishes are endemic.
Diamond mining, large- scale extraction o f heavy minerals, over grazing and illegal collection o f succulents and bulbs. Illegal hunting and wildlife trade, road construction, mining, and civi l conflict.
Mining, logging, construction o f hydroelectric dams, over-grazing, invasive alien species.
Urbanization, mining, road construction, agricultural expansion, and deforestation.
~~
Agriculture, grazing, clearing o f land, illegal logging, wildlife trade, plantations and population growth.
Fragmentation, population density, infrastructure, unsustainable agriculture, poaching.
Hotspots in bold e.g. Atlantic Forest are where CEPF invested during Phase 1. The table i s based on the revised 34 hotspots e.g. Coastal Forests and Eastern Arc o f Kenya and Tanzania has become two Hotspots. * Countries eligible for GEF funding as World Bank client countries that have ratified the Convention on Biological
* * These hotspots include some countries not eligible for W B and GEF funding.
The CEPF Donor Council may review the eligibility criteria to include marine ecosystems within targeted hotspots. Under the second phase o f the CEPF program, the Donor Council may also decide to establish new funding windows outside the WBiGEF CEPF-2 Project to accommodate the strategic interests o f specific donors.
Diversity Countries in parentheses e.g. (Timor-Leste) not currently eligible.
24
Annex 2: Major Related Projects Financed by the Bank and/or other Agencies
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Sector Issue
1.
2.
3,
Project I Latest Supervision (PSR) Ratings I Implementation Development Progress (IP) Objective (DO)
The CEPF-2 project strongly complements several ongoing and planned Wor ld Bank global and regional projects, and other donor interventions. Relevant in this respect are:
Biodiversity Conservation
. Critical Ecosystem Partnership Fund. The Bank-implemented GEF grant for the f i rst phase o f CEPF closed in March, 2007.
Critical Ecosystem Partnership Fund Satisfactory Satisfactory
Coral Reef Targeted Research and Capacity Building Satisfactory Satisfactory for management MesoAmerican Biological Corridor Satisfactory Satisfactory
IFC Environmental Business Finance Program Satisfactory Satisfactory
. Coral Reef Targeted Research and Capacity Building for Management, a global project which focuses on strengthened conservation and sustainable management o f coral reefs.
China
9 Several regional projects that focus on conservation and sustainable use o f terrestrial and marine biodiversity in the MesoAmerican Biological Corridor, including: Conservation and Sustainable Use o f the Mesoamerican Barrier Reef System; and Integrated Ecosystem Management in Indigenous Communities.
Guangxi Forest Project NIA NIA
. ADB Greater Mekong Subregion Core Environment Program
There are also several ongoing and planned national projects relevant to the CEPF-2 program and especially to implementation in the first three hotspots selected: Indochina, Polynesia-Micronesia and Western Ghats and S r i Lanka.
The table below provides a list o f completed, ongoing and planned projects that are relevant to this project. The proposed project wil l build on the experiences obtained in recently completed projects, including lessons learned in linking biodiversity conservation activities with community development, more sustainable resource management and income-generating activities for local communities.
I (Bank financed projects only) - I
25
26
Annex 3: Results Framework and Monitoring
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Results Framework
PDO / GEO
Project Development Objective - Strengthen the involvement and effectiveness o f civil society in conservation and management o f globally important biodiversity.
Global Environment Objective - Conservation outcomes consolidated in existing CEPF regions and funding expanded to new ecosystems in order to achieve strategic and sustainable conservation and integrated ecosystem management in areas o f globally important biodiversity.
Intermediate Outcomes
Outcome 1: Globally significant biodiversity i s under improved management and protection.
Project Outcome Indicators
At least 14 critical ecosystemshotspots with active investment programs involving c iv i l society in conservation, including at least 9 new regions. At least 600 c iv i l society actors, including NGOs and the private sector, actively participate in conservation programs guided by the CEPF ecosystem profiles. At least 20 mill ion hectares o f key biodiversity areas with strengthened rotection and management. At least 8 mill ion hectares o f new protected areas4 established. At least 1 mill ion hectares in production landscapes managed for biodiversity conservation or sustainable use.
P
Intermediate Outcome Indicators 0 At least 70% o f targeted key
biodiversity areas with strengthened protection and management (SP 1 METT)
At least 30% o f projects globally enable effective stewardship o f biodiversity and ecosystem services by indigenous and local communities in focal areas.
Use of Project Outcome Information
YR1 - YR5: Gauge CEPF’s global performance in achieving coverage targets and key milestones under performance indicators against ecosystem profile targets. Missed targets may require the identification o f causes and remedial actions.
YR3: Contribute to independent mid-term assessment and adjust overall strategy and operations as recommended.
All years: Identification and pursuit o f opportunities for long-term sustainability and replication.
All years: Results feed into global outreach program.
End o f project evaluation.
Use of Intermediate Outcome Information Profile Midterm: Gauge portfolio- level performance against targets and key milestones identified in ecosystem profile. Refine Results Framework or ecosystem profiles as needed. (Start-up in hot spots staggered)
Project Midterm: Assessment o f contribution to GEF and CBD 2010 targets based on SP1 METT; SP2 METT
Guided by a sustainable management plan Protected through a formal legal declaration or community agreement
27
Outcome 2: Biodiversity conservation i s integrated into landscape and development planning as a result o f increased local and national c iv i l society capacity,
Outcome 3: Effective monitoring and knowledge sharing.
At least 10 sustainable- financing mechanisms established or strengthened with initial capital secured. At least 5 multi-regional projects contribute to the conservation o f globally significant biodiversity.
At least 60% o f projects outside protected areas effectively introduce or strengthen biodiversity conservation in management practices (SP2 METT). A t least 10 public-private partnerships mainstream biodiversity in production sectors, such as forestry, agriculture and tourism sectors.
At least 50% o f global grant funds allocated to local civil society groups5.
At least 70% o f targeted communities involved in sustainable use projects show socioeconomic benefits.
0 100% o f CEPF regions possess baseline data and indicators and report against approved logical frameworks.
global Results Framework standardized for all hotspots ecosystem profiles and contribute to global reporting and assessment, At least 75% o f civil society groups receiving grants demonstrate more effective
Selected indicators from
All years: Identification and pursuit o f opportunities for long-term sustainability and replication.
All years: Results feed into global outreach program.
End of project: Assessment o f overall project achievement and contribution to CBD work programs.
Profile Midterm: With each hotspot, gauge portfolio-level performance against targets and key milestones identified in ecosystem profile. Refine Results Framework or ecosystem profiles as needed. (Start-up in each hotspot will be staggered.)
Project Midterm: Assessment o f contribution to GEF and CBD 2010 targets based on SP2 METT
All years: Identification and pursuit o f opportunities for long-term sustainability and replication.
All years: Results feed into global outreach program.
End o f project: Assessment o f overall project achievement and contribution to CBD work programs.
Profile midterm: Portfolio review to feed into strategy decisions
Midterm and end o f project: Calibrate against other biodiversity status reports produced for the hotspot e.g. forest status, IBAs, etc.
Al l years: Identifying best practice and lessons learned for dissemination and uptake.
A l l years: Results feed into global
CEPF defines a local civi l society group as one that i s legally registered in a country within the hotspot and has an independent board o f directors or a similar type o f independent governing structure.
28
Outcome 4: Ecosystem profiles act as shared strategies for effective program- wide implementation.
capacity to plan and manage conservation projects. At least 2 learning exchanges andor participatory assessments o f portfolio-level results hosted and documented within each hotspot (at least 201). Ecosystem profiles and investment strategies developed with stakeholders, approved, and guide grant- making. In at least 5 hotspots, ecosystem profiles influence other donors’ investment strategies. Number o f local c iv i l society groups capacitated by RITs to design and implement projects. Overall program, including a l l activities and financial management, effectively monitored and in compliance with CEPF Operational Manual. Program-wide replication strategy developed and implemented to disseminate best practice within and across hotspots. 10 publications produced and disseminated on CEPF experiences, lessons learned and specific themes. 100% o f final project reports compiled by grant recipients available online. Visitors to Web site and newsletter subscribers increase by at least 70% 5 annual reports and 20 quarterly reports produced.
outreach program.
Midterm and end o f project: assess progress and examples o f replication
All years: Results feed into profile planning, implementation and adaptation.
All years: Profiles guide decision- making and assessments o f progress and results.
All years: Results feed into global reporting to CEPF donors and overall outreach program.
Midterm and end o f project: results feed into evaluation.
29
Arrangements for results monitoring
1. Monitoring and evaluation would be undertaken at three levels: the overall program, ecosystem and project levels. Data gathered will inform decisions and adaptive management as well as feed into analysis and documentation o f best practices, lessons, and results within, and across, critical ecosystems and at the global level.
2.
3.
Institutional issues. The Regional Implementation Teams would have lead responsibility for monitoring at the ecosystem and individual project levels. All grantees, including the Regional Implementation Teams, will submit quarterly financial reports and regular programmatic reporting detailing progress toward specific deliverables. The Regional Implementation Team’s monitoring wil l include review o f these reports by grantees and a participatory assessment at the ecosystem level conducted together with grantees and other stakeholders at the profile midterm. Monitoring by the CEPF Secretariat will include monitoring the performance o f the Regional Implementation Teams and lead responsibility for producing analytical overviews o f each ecosystem portfolio, including details o f interim progress toward the conservation outcomes and lessons learned. The Secretariat will also be responsible for monitoring performance o f the overall program and ensuring that al l activities and financial management are carried out in compliance with the guidance o f the Donor Council and the Operational Manual, including GEF Policies and the World Bank Safeguard Policies. The Operational Manual has been revised and updated and wil l be presented to the Donor Council for approval.
Monitoring for biodiversity outcomes. Specific conservation targets and related indicators would be developed as an integral part o f the ecosystem profi l ing process for each ecosystem. Priorities for a second phase o f CEPF wil l include: i) ensuring that conservation targets are defined in al l regions that receive CEPF funding; ii) improved outcomes monitoring at the ecosystem level in al l critical ecosystems receiving funding; and iii) sharing the results widely to demonstrate biodiversity impact and enable adaptive management by CEPF and the wider conservation community. In al l cases, the Regional Implementation Team and other local partners would lead the monitoring. The approach wil l build upon and further strengthen the success o f the first phase to conduct baseline assessments in partnership with these groups, and then to facilitate and support continuation o f monitoring at the local level. These procedures will be systematically applied in every portfolio using common tools and reports to generate comparable data that can be used to develop portfolio overview reports and assessments o f the overall program’s impacts. The project would utilize the GEF SP1 and SP2 tracking tools to monitor impact o f protected area and mainstreaming interventions. Results from monitoring at the ecosystem level will be calibrated against data drawn f rom the Biodiversity Early Warning System at the midterm and other expertise o f CI’s Center for Applied Biodiversity Science (CABS) as wel l as the global monitoring programs o f other conservation organizations. This calibration would provide additional information on the status o f specific conservation targets and landscapes and inform decisions o n whether to adapt implementation strategies.
30
4. Other Outcomes. As recommended by the independent evaluation, CEPF-2 would complement data collected on conservation outcomes by uti l iz ing simple socio-economic indicators and developing and testing new performance monitoring methodologies, including measures to reflect changes induced in c iv i l society. The Regional Implementation Teams wil l also have lead responsibility for monitoring these outcomes as part o f assessing individual project reports. These types o f indicators and measures may also be further developed at the ecosystem level as part o f the profi l ing process for each region, drawing from a strengthened analysis o f the socioeconomic, pol icy and c iv i l society context o f each ecosystem.
5. Semiannual and midterm evaluation. The Wor ld Bank will conduct semiannual supervision missions to assess progress made in the overall project activities. Supervision missions wil l involve regional Bank staff in reviewing implementation o f grants within selected hotspots to draw lessons learned and to provide guidance to the RITs and project team. In addition, a midterm evaluation o f project execution will be conducted no later than three years after the f i rst project disbursement.
Indicative total cost of M&E (also reflected in the total project cost): $3.72 million; no GEF allocation.
31
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Annex 4: Detailed Project Description
GLOBAL: Second Critical Ecosystem Partnership Fund Project
1. The proposed project would build upon the experiences and lessons learned in phase 1 , , and recommendations from the independent evaluation, to expand the global CEPF program, including expansion into new ecosystems and hotspots. The CEPF-2 project would focus on critical ecosystems within at least14 biodiversity hotspots, including nine
' 6 % .\'?. 'h,
.I
new hotspots, in Wor ld Bank client countries that have ratified the CBD. Investment strategies for three new critical ecosystems have already been developed as part o f phase 1 and would be the f i rs t to be implemented: Polynesia-Micronesia; Indo-Burma; and Western Ghats and Sri Lanka. Other ecosystems for investment would be chosen based on biodiversity status and threats, conservation needs, social and political environment, and current or planned investment by other donors. The donor partners would also review eligibility criteria to enable CEPF investment in marine ecosystems within, and adjoining, hotspots. An indicative l i s t o f 14 hotspots for investment will be developed and endorsed by the Donor Council for phased implementation; this l i s t may change over time in line with conservation needs and other donor investments.
2. The number o f hotspots approved for new investment would continue to be staggered to ensure adequate funding and implementation capacity, and the total investment level per hotspot wil l vary depending on needs and local capacity. In each hotspot, disbursement o f grants wil l be guided by ecosystem profiles based on a stakeholder-driven prioritizing process to create a shared strategy from the outset.
3. The project wil l include four interlinked components. GEF grant finding would be used exclusively to support Ecosystem Grants under components 1 and 2.
Component 1 : Strengthening protection and management of globally significant biodiversity (Total budget: $52.1 million; GEF $13.22 million).
4. CEPF-2 would focus on key biodiversity areas and address threats to biodiversity across broad landscapes that include a matrix o f land uses, including protected areas, biological corridors and high value conservation sites in production landscapes. Protected areas remain a critical foundation o f biodiversity conservation worldwide, yet only 5% o f globally significant biodiversity within most hotspots is currently protected. Target areas would not be l imited to formal designated protected areas and legal entities but wil l also include indigenous reserves, and community and private lands that are managed for a conservation objective. Support to c iv i l society groups would contribute to the strengthened protection and management o f more than 20 mi l l ion hectares o f key biodiversity areas within hotspots. This would include at least 8 mil l ion hectares o f new protected areas. Activities wil l be selected on a competitive basis but are expected to include the following:
(a) Protected areas and other key biodiversity areas. CEPF would support c iv i l society efforts to catalyze improved management and expansion o f existing protected areas, including creation o f new protected areas and innovative
37
management involving c iv i l society and public-private partnerships. Supported activities would include building awareness and support for protected areas and systems, development and provision o f technical expertise and tools for effective conservation planning, and enabling local community and indigenous groups to take part in the design, implementation, and management o f key biodiversity areas.
(b) Community - Indigenous Initiatives. CEPF would assist communities, including indigenous groups and other partners in management and stewardship o f biologically r ich lands that buffer key biodiversity and protected areas. The CEPF-2 portfolios would supported community stewardship o f biodiversity through improved use and management o f natural resources, the reduction or elimination o f practices harmful to biodiversity, and the development and adoption o f a variety o f alternative livelihood opportunities which emphasize synergies between biodiversity conservation and human welfare.
(c) Innovative financial mechanisms for sustainability. Achieving financial sustainability for biodiversity conservation i s an ongoing challenge. CEPF-2 would scale up efforts to create and support innovative financial mechanisms for sustainability, including the introduction and use o f conservation financing tools such as payments for environmental services and economic incentives for conservation. CEPF-2 wil l also further strengthen jo int efforts with government partners, the private sector and other funding mechanisms, including two complementary funds managed by C I (the Global Conservation Fund and Verde Ventures), to maintain and ensure the sustainability o f globally significant biodiversity and ecological processes over time.
(d) Multi-regional priorities. This subcomponent would support a few targeted grants to c iv i l society groups to meet strategic needs in multiple hotspots based on profile priorities. These could include, for example, activities to address common threats such as trade in endangered species where demand and supply chains cross national borders, and global assessments to consolidate available information o n the distribution, ecology and conservation status o f groups o f species to indicate the status o f ecosystem health. Multi-hotspot grants would also capitalize on significant co-financing opportunities and replication and scaling up o f successful approaches across hotspots in a cost-effective way.
Component 2: Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning. (Total budget: $23.9 million, GEF $6.78 million).
5. Reconciling ecosystem conservation with sustainable development on different scales across complex jurisdictional boundaries, often in situations o f weak governance, i s perhaps the major challenge facing the conservation and development community. Mobil izing c iv i l society to play a more effective role in this process is the CEPF niche. Grantees include individuals, farming cooperatives and community organizations, national
38
NGOs, research institutions and private sector organizations, and international NGOs. Many o f these groups act as vital multipliers, further building local and national capacity for conservation. A key CEPF goal i s empowerment o f c iv i l society actors to take part in, and influence, decisions that affect local l ives and livelihoods and, ultimately, the global environment. This component is particularly targeted to biological corridors and more sustainable management in production landscapes. It builds upon the activities supported under Component 1 through support for strategic and effective alliances to increase impact and sustainability. Grant making wil l foster alliances by identifying and linking potential partners; helping to design integrated and complementary approaches and supporting partnerships within c iv i l society as well as with development institutions, government agencies, corporate partners, and others.
6. CEPF would support activities that seek to integrate biodiversity conservation in production systems and sectors, including enabling c iv i l society groups to plan, implement, and influence biodiversity outcomes as effective partners in sustainable development. Such participation wil l build on local knowledge and technical expertise, and leverage social capital to bring innovative ideas to solving local problems. Examples could include development o f community, municipal or regional land use plans, plans for local economic development, “territorial development” plans, certification for more sustainable management and private agreements. The focal approach would be to strengthen protection o f critical biological corridors that link key biodiversity areas within a multiple use landscape.
7. Civ i l society activities to be supported wil l include assisting in improved land-use planning and activities that mainstream conservation into production landscapes, including collaboration with the private sector; promoting supportive pol icy and legislative frameworks; promoting more sustainable resource management linked to livelihoods; and implementing measures to control and manage invasive alien species in regions where these are a particular threat. Building upon successful models from the f i rs t phase o f the program, CEPF would promote collaboration with governmental partners and sectors such as mining, agriculture, logging and tourism, by fostering innovative public-private partnerships and multi-stakeholder alliances to harmonize conservation with economic development. The project would strengthen c iv i l society capability for sustainable resource management and for advocacy and influence over development decisions and national strategies at local, regional and trans-boundary scales.
Component 3: Monitoring and knowledge sharing (Total budget: $4.5 million; no GEF allocation).
8. CEPF priorities include i) improved outcomes monitoring in al l hotspots receiving CEPF funding and ii) promoting results-based conservation based on lessons learned and good practice.
9. This component would support improved monitoring, learning, replication and scaling up o f promising models from components 1 and 2. Specific subcomponents would include:
39
Strengthening monitoring and evaluation at the ecosystem level, including systematic analysis and documentation of CEPF results and experiences. This component would support monitoring and evaluation o f individual projects and deriving and sharing lessons learned within the hotspot. Monitoring and evaluation o f projects would be led by the RITs and include: a) systematic analysis and documentation o f grantees’ performance against individual project and ecosystem targets and b) engaging c iv i l society groups, including local communities and Indigenous Peoples, in participatory monitoring and c) expanding and formalizing information sharing and learning opportunities across the hotspot.
10. Specific conservation targets and related indicators would be developed as an integral part o f the ecosystem profi l ing process for each hotspot. In addition, selected indicators from the global Results Framework would be monitored and evaluated within each hotspot annually. These would include indicators to monitor biodiversity status and outcomes, as well as c iv i l society, policy, and socioeconomic indicators. Data on the status o f specific conservation targets and landscapes would be calibrated against data drawn from the Biodiversity Early Warning System o f CI’s Center for Applied Biodiversity Science (CABS) and the global monitoring programs o f other conservation organizations and partners to determine whether shifts may be needed in investment strategy.
Expanding and formalizing information sharing and learning opportunities. This subcomponent would support conservation at the regional level by expanding and formalizing information sharing and learning opportunities as part o f a participatory monitoring approach already tested and replicated by CEPF in multiple hotspots. Results would lead to adaptive management and also feed into analysis and documentation o f lessons learned and best practices, within, and across, the hotspot. The subcomponent wil l also support specific activities to promote distillation, dissemination and uptake o f good practice, including i) analyses o f specific management practices to derive lessons learned (ii) cross site exchanges between grantees for learning and dissemination o f best practice; and iii) outreach activities targeting communities, local government and NGOs to increase the uptake o f good practice into other conservation initiatives within the hotspot.
Component 4: Ecosystem profile development and project execution (Total budget: $19.5 million; no GEF allocation).
1 1. This component would support three subcomponents a) development o f ecosystem profiles as strategic implementation documents for the partnership and wider conservation community; b) Regional Implementation Teams within the hotspots; and c) overall execution and administration o f the global program through the CEPF Secretariat.
Ecosystem profile development. In each hotspot, disbursement o f grants would be guided by ecosystem profiles based on a stakeholder-driven prioritizing process to identify conservation targets, major threats, socioeconomic factors, and current conservation investments. The process would be led by locally-based NGOs or other c i v i l society organizations to develop a shared strategy by identifying Conservation needs, gaps, opportunities and the specific CEPF niche. In l ine with recommendations f rom the evaluation, future profi l ing would include strengthened analysis o f the socioeconomic, policy, and c iv i l society context within each hotspot for a more comprehensive
40
understanding o f development priorities, threats and opportunities. Ways to address poverty and conservation linkages, and gender issues, will also be explored. Future profiles would ensure greater inclusiveness by ensuring that key communities, including indigenous groups within the focal biodiversity areas, take part in determining priori ty actions.
Regional Implementation Teams. Based on recommendations from the independent evaluation, CEPF-2 would devolve more responsibility to locally based Regional Implementation Teams for capacity building and grant-making and management at the local level. This subcomponent would support the RITs in standardized and expanded responsibilities and a more active role in overall CEPF grant-making. Responsibilities would include i) acting as an extension service to assist local groups in designing, implementing and replicating successful conservation activities; ii) reviewing al l grant applications and managing external reviews with technical experts and advisory committees; iii) direct decision-making authority for grants up to $20,000 and deciding jo int ly with the CEPF Secretariat on other applications; and iv) interacting and collaborating with CEPF partners and other donor agencies across the hotspot, as wel l as governments and other sectors in implementation.
CEPF Secretariat. C I would administer and execute the global program. This includes hosting the CEPF Secretariat, employing CEPF Secretariat staff, and ensuring that al l funds are managed with due diligence and efficiency. The Secretariat is responsible for strategic and financial management, oversight and reporting for the global program. This includes supervision o f the ecosystem profi l ing process; training and management o f the Regional Implementation Teams; and overall ecosystem portfolio development, monitoring and reporting to ensure that al l activities and financial management are carried out in compliance with Donor Council decisions and CEPF operational guidelines. The secretariat is responsible for preparing and updating the Operational Manual to ensure that grant selection and implementation i s consistent with GEF Policies and the World Bank Safeguard policies and procurement procedures. The Secretariat i s also responsible for fundraising, financial management, donor coordination, and global information management and outreach, including website management, newsletter and publication production, and development and implementation o f a program-wide replication and dissemination strategy for lessons learned and good practice. Through a jo int work program with the World Bank, the CEPF Secretariat would assess the impact and value o f small grants programs in achieving biodiversity conservation.
41
Annex 5: Project Costs GLOBAL: Second Critical Ecosystem Partnership Fund Project
Components: Number and Title
Costs are indicative only and wil l be further refined at appraisal.
Total Source of Cost in Financing
us
1 A 1B 1 C
I $1,000 I I GEP I Other
Protection o f key biodiversity areas 26,000 7,000 19,000 Community and Indigenous Initiatives 16,100 4,220 11,880 Innovative financial mechanisms for sustainabilitv 8,500 1,700 6,800
I I __- - _--_-
1 I Strengthening protection and sustainable management of globally significant biodiversity
1D Multi-regional priorities 1,500 300 1,200
ComDonent 1: Total 52.100 13.220 38,880
2 Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning Mainstreaming biodiversity conservation 23,900 I 6,780 I 17,120
ComDonent 3: Total 1 4.500 1 1 4.500
Component 2: Total I
23,900 6,780 17,120
4B I Regional Implementation Teams I 4.600 I I 4,600
3 3 A
3B
Effective monitoring and knowledge sharing Strengthening monitoring and evaluation, including 3,720 3,720 systematic analysis and documentation o f CEPF results and experiences Expanding information sharing and learning opportunities 780 780 within hotspots
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4 4A
Ecosystem profile development and project execution Ecosystem profile development 2,600 I 2,600
4C I CEPF Secretariat
Component 4: Total
Total
12,300 12,300
19,500 19,500
100,000 20,000 80,000
Annex 6: Implementation Arrangements
GLOBAL: Second Critical Ecosystem Partnership Fund Project
1. The CEPF implementation arrangements are designed to build o n lessons learned during the f i rst phase, to enable continued expeditious, efficient support to diverse c iv i l society groups, and to establish a clear and effective chain o f accountability for results.
2. Under CEPF-2, the partnership would retain the overall structure o f a Donor Council, Secretariat and Working Group. C I wil l continue to administer and execute the project o n behalf o f the CEPF partners. This includes hosting the CEPF Secretariat, including the CEPF Grant Management Unit and Regional Grant Directors, and ensuring that al l funds are managed with due diligence and efficiency. The CEPF Secretariat i s responsible for strategic and financial oversight o f the global program, overall information management, and global outreach and communications. The Secretariat would supervise the profi l ing process, the RITs and the performance o f the overall program to ensure that al l activities and financial management are carried out in compliance with Donor Council decisions and the Operational Manual, including GEF Policies, the World Bank Safeguard Policies, and Bank guidelines on Procurement.
3. The Donor Council, comprised o f senior representatives from each CEPF donor institution, reviews and approves each ecosystem profile as wel l as annual spending plans. The Council also approves any amendment to the CEPF Operational Manual, which contains the specific operating policies and procedures o f the Fund. In addition, the Council creates and approves the conditions under which new donors may be invited to take part in the Fund and approves additional members o f the Donor Council. The Donor Council i s currently chaired by the World Bank.
4. The Working Group, comprised o f technical experts from each donor institution, provides guidance to the Secretariat on strategy development, monitoring, and other aspects o f implementation. The members also act as advisors to their respective Donor Council representatives and as CEPF focal points for their broader institutions. Guests, including c iv i l society groups that lead the ecosystem profi l ing processes, grant recipients and other stakeholders, wil l be invited to inform relevant topics o f discussions.
5. The Regional Implementation Teams (RITs), comprised o f locally-based c iv i l society groups, wil l lead implementation within the hotspots. The selection o f the RITs wil l be based on a competitive process, with the Working Group making the selection to be approved by the CEPF Donor Council. The RITs will be responsible for the strategic implementation o f the ecosystem profiles and building a broad constituency o f c iv i l society groups working across institutional and geographic boundaries toward achieving shared conservation goals. As recommended by the independent evaluation, R I T responsibilities have been standardized and expanded to devolve further responsibilities to these teams. TORS for RITs have been approved by the Donor Council.
43
6. All funds provided from the proceeds o f the GEF Grant would be utilized for ecosystem grants. Such grants would be awarded to c iv i l society grantees in accordance with the procedures outlined in the Operational Manual. Government owned enterprises or institutions may participate only if they can establish i) that the enterprise or institution has a legal personality independent o f any government agency or actor ii) that the enterprise or institution has the authority to apply for and receive private funds and iii) that the enterprise or institution may not assert a claim o f sovereign immunity.
7. Once a Grant proposal i s approved, a grant agreement wil l be signed between C I and the Grantee for grants above $20,000, and between the RIT and the Grantee for sub-grants o f $20,000 and less, based on a standard CEPF Grant Agreement outlined in the Operational Manual. The maximum size o f any grant would be less than U S $ l .O mil l ion dollars and would typically finance direct, approved costs, such as salaries, management fees, travel, consumables and other operating expenses. Such funds cannot be used for purchase o f land or the physical relocation o f people. The procurement procedures to be followed by the grantees are also outlined in the CEPF Operational Manual and CEPF Grant Agreement and fol low commercial practices. C I wil l also enter into written agreements with RITs, describing the Framework under which RITs will issue sub-grants. GEF funds will be used for these sub-grants but not for directly funding RITs.
8. RITs wil l provide guidance and assistance to the grantees to ensure that al l procurements are carried out in accordance with the CEPF Grant Agreement. They wil l have direct decision-making authority for a l l grants o f $20,000 or less, and joint ly with the CEPF Secretariat wil l decide on al l other applications. Grants above $250,000 would be subject to additional external technical review, including Bank regional staff as appropriate. In addition, the C I Secretariat shall carry out prior review and approval o f al l procurement requests estimated to cost US$5,000 or more. The RITs wil l carry out this review and approval for the sub-grants they award. All other procurements may be awarded by the Grantees without prior review, but shall be subject to post-review on a sample basis.
9. All grants wil l be awarded on a competitive basis. Additional review for international organizations wil l include the following steps: . The existing programs and potential role o f international organizations in each
hotspot wil l be documented as part o f the ecosystem profi l ing process. . All international groups, including CI, wil l be required to demonstrate a comparative advantage in their grant application. Proposals designed and implemented with a local partner or incorporating strong capacity building would be given preference. . The RIT and/or advisory committee in each hotspot will review the proposal and, where appropriate, formally wr i te a justification for sole source approval.
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10. The project incorporates specific steps to ensure further transparency and effective decision-making, particularly in regard to the award o f CEPF grant funds to C I programs and other international organizations. C I would not be eligible for a set share o f CEPF funds but would compete for CEPF grant funding alongside other groups through the steps detailed above. In addition, the individual groups that comprise the RITs, as well as other offices and programs o f those organizations, would not be eligible for additional grants within that particular hotspot. Applications from formal partners o f those organizations that have an independent operating board o f directors wi l l be accepted, but subject to additional external review. All proposed grant awards over $20,000 to Conservation International wi l l require approval on a time-bound no objection basis by the CEPF Working Group; grants up to $20,000 will be awarded by the Regional Implementation Teams.
Summary of Core Roles and Responsibilities
CEPF Secretariat Regional
Activity Imdementation Teams Grant Directors (GD) Grants Unit Management (G,) WTs)
S T A R T UP
Ecosystem profile Supervise the Support GD as needed NIA development development o f profiles
and related documents required for approval by the CEPF Donor Council, including negotiating and monitoring technical contracts
Engage relevant regional donor representatives, other I A S and CEPF Working Group in process; acquire GEF focal point approvals; and assist External Affairs in finalizing documents for Donor Council approval
NIA
RIT selection and Coordinate selection o f Ensure region i s fully NIA award process RITs for approved incorporated into CEPF
profiles, including grants management analysis o f proposals system and all other against RIT Terms o f grant-making tools to Reference and Selection enable receipt and Criteria. processing o f
applications; support
45
CEPF Secretariat Regional
Activity Implementation Teams OUTS) Grants Management
Unit (GMU) Grant Directors (GD)
Lead development and negotiation o f selection process as consulting agreement needed with the selected RIT based on Donor Council Contracting - risk Participate in direction assessment processing, negotiations, complete
agreement preparation, any additional steps to Train RIT staff on CEPF legal review finalize agreement strategic approach and coordination, etc key elements o f project design process (outcomes focus, etc) Train RIT in CEPF Receive training on
grant-making and safeguards, Operational reporting systems, Manual, harmonize processes and standards, report systems. including procurement and safeguard policies
GD in competitive
Launch CEPF Participate in launch Support RIT as needed, Lead launch preparation program national-level website and activities in
announcements consultation with CEPF External Affairs
I GRANT MAKING
Grants up to $20,000 selection and awarding
Supervision o f RIT Coordinate with RIT on Lead review and overall performance to financial management decision-making for all include post-review o f and reporting proposals, develop sampling o f awarded documentation and grants agreements, and directly
Support RIT as needed award grants.
Assist civil society groups in designing, implementing and replicating successful projects
Grant above $20,000 Jointly lead decisions on Contracting - risk Jointly lead decisions on selection and awarding all proposals with RIT* assessment processing, all proposals with GD*
agreement preparation, Conduct final technical legal review Prepare justification for review and sign o f f for coordination, etc approval and all compliance and risk to C I and CEPF prior to presentation to CEPF ED for signature
required assessments
Review a l l grant
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CEPF Secretariat Regional
Activity ImDlementation Team! Grant Directors (GD) Grants Unit Management (GMU) (RIW
Support RIT in coordinating review process as needed
applications and lead external reviews with technical experts and advisory committees
Assist c iv i l society partners in designing, implementing and replicating successful projects
MONITORING
?roject level Support RIT with advice Guidance and support to Lead monitoring and related to performance, GD and RIT as needed finances, and safeguard projects, including compliance o f grantees
evaluation o f all
reviewing reports and conducting site visits
Monitor overall RIT performance against reports for grants above reports; manage funding TOR, including $20,000; payment for grants under $20,00C sampling o f award o f processing and recommend grants less than $20,000 approval o f payments to
GMU for all others
Final review o f financial Maintain all required
'ortfolio level Lead development of Support GD and RIT as Support GD in preparing annual hotspot portfolio needed annual portfolio overviews. Recommend overviews, including refinement o f profile organizing a andor logical participatory assessment framework targets as needed supporting final
at the mid-term and
evaluation as needed
Monitor RIT performance, and overall portfolio development.
Regularly report on implementation o f projects and progress against RIT Terms o f Reference and indicators in the profile logical framework
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CEPF Secretariat Regional
Activity Implementation Teams Grants Management WTs)
Unit (GMU) Grant Directors (GD)
Manage portfol io budget and recommend adapting Strategic Direction allocations and strategy approaches as needed to meet the profi le objectives
Support GD as needed
PARTNERSHIP DEVELOPMENT
rhroughout Support RIT as needed Support RIT and GD as Coordinate with mplementation needed regional programs o f
CEPF donors and GEF implementing agencies, government officials, and other donors in the hotspot for effective profi le implementation
kGrants above $20,000 proposed for award to CI, i t s branch offices, or affiliates would require the approval o f the CEPF Working Group.
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Annex 7: Financial Management and Disbursement Arrangements
GLOBAL: Second Critical Ecosystem Partnership Fund Project
EXECUTIVE SUMMARY
1.
2.
3.
4.
5.
A Financial Management Assessment o f the Conservation International Foundation (CI) was undertaken in March 2007 with the objective o f determining whether i t has in place adequate financial management arrangements that satisfy the Bank’s OPBP 10.02 with regards to the Proposed Grant from the Global Environment Facility (GEF) Trust Fund to the Critical Ecosystem Partnership Fund (CEPF). Under OPBP 10.02, financial management arrangements are the budgeting, accounting, internal control, funds flow, financial reporting, and auditing arrangements o f the entity and entities responsible for implementing Bank-supported operations. For each operation supported by Bank administered financing, the Bank requires the recipient to maintain financial management arrangements that provide assurance that the proceeds o f the financing are used for the purposes for which the financing was granted.
The assessment was carried out in accordance with the Bank’s guidelines under Financial Management Practices in World Bank-Financed Investment Operations dated November 3, 2005. Financial management risk i s the risk that grant proceeds wil l not be used for the purposes intended and i s a combination o f risk factors. Taking into account the risk mitigation measures proposed, the financial management risk rating for this project i s assessed as moderate.
CI’s financial management system meets the Bank’s minimum requirements and the proposed accounting and internal control systems for the CEPF wil l ensure proper reporting o f use o f the funds for the conservation o f the ecosystems that are approved annually. The project can also use the existing financial management system to produce Interim un-audited Financial Reports (IFR) that can be used as a basis for disbursement.
Founded in 2000, CEPF i s a jo int initiative o f the World Bank, Global Environment Facility (GEF), the Government o f Japan (GoJ), the John D. and Catherine T. MacArthur Foundation (MacArthur) and CI. L’ Agence Franqaise de DCveloppement joined in 2007. As one o f the founding partners, C I administers the initiative, hosts the CEPF Secretariat and ensures that al l funds are managed properly. Each o f the original five donors committed to providing $25 mi l l ion to the f i rst phase o f the program for a total o f US$125 million in grant funding. Funding from the Bank and GEF will end in early 2007. To date over 900 c iv i l society groups received grants under the first phase o f the program.
The proposed project aims to support a second phase o f the global CEPF program, or CEPF-2. The total proposed cost for CEPF-2 amounts to US$lOO mi l l ion o f which the GEF contribution will be US$20 million. CEPF-2 would focus on critical ecosystems within at least 14 biodiversity hotspots eligible for CEFP investment. As part o f the f i rs t phase o f CEPF, investment strategies for three new hotspots have already been developed and would be the f i rst priorities for implementation under CEPF-2, namely: Polynesia- Micronesia, Indo-Burma (Indochina region) and the Western Ghats and S r i Lanka. Other
49
6.
7.
8.
9.
ecosystems for investment would be chosen based on biodiversity status and threats, conservation needs, social and political environment, and current or planned investment by other donors. The total investment level per hotspot will vary depending on conservation needs and local capacity. Resources for the part o f the program to be administered by the Bank wil l come from a GEF grant.
The proposed project has four interlinked components, o f which GEF resources are proposed to contribute to only components 1 and 2 through Ecosystem Grants:
(a) Strengthening protection and management o f globally significant biodiversity.
(b) Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning.
(c) Monitoring and knowledge sharing.
(d) Ecosystem profile development and project execution.
The CEPF-2 implementation arrangements are designed to build upon the lessons learned from phase 1. Under CEPF-2, the partnership would retain the overall structure o f a Donor Council, Secretariat and Working Group. The administration and execution o f the program will s t i l l rest with C I through the CEPF Secretariat, on behalf o f the CEPF donors. C I has suitably qualified staff to carry out th is function. One o f the lessons learned from the f i rst phase o f CEPF and highlighted in the independent evaluation i s that the coordination units, CEPF's representatives and grant managers on the ground, were one o f the key strengths o f CEPF. Hence CEPF has expanded the roles and responsibilities of the coordination units now referred to as Regional Implementation Teams (RITs) to include more responsibilities in grant-making decisions, capacity building o f local partners and monitoring o f individual projects at the regional level.
Advance method i s used for disbursement o f the proceeds from the GEF Grant. Advances wil l be made into the C I CEPF fund account, and the uses o f the advances wil l be tracked through the C I accounting system. The ledger account used for monitoring the receipt and use o f the advances under the CEPF fund account i s considered as the designated account (DA) for advances. The ceiling for this designated account wil l be variable, and determined on the basis o f cash projections against the Annual Spending Plans approved by the CEPF Donor Council. C I will be directly responsible for the management, monitoring, maintenance and reconciliation o f the DA o f the program.
The project wil l be disbursing using the report based disbursements. Proceeds o f the GEF grant will be disbursed against the Ecosystem Grants expenditure category. The disbursement rates wil l be based on cash projections against the annual spending plans approved by the CEPF Donor Council.
10. Under the f i rst phase, advances were made into the CEPF Fund Account based on cash projections included in the PMRs. These advances were then accounted for in the subsequent PMRs. This would therefore be referred to as "accountable" advances.
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1 1. The project would be required to submit quarterly Interim un-audited Financial Reports (IFR), annual spending plan and financial report and annual CEPF Audit. The proposed project will use IFR prepared by C I as supporting documents for disbursement. IFR will be produced by C I on a quarterly basis, using the same IFR template as under the first phase o f the CEPF program.
FINANCIAL MANAGEMENT ASSESSMENT
The Country Issue 12. The geographical dispersion and expansion o f hot spots add to the complexity o f the
project.
13. There may be weak overall FM capacity in the targeted regions but the capacity o f the RITs is likely to be relatively strong, since having an acceptable financial management capacity and FM systems i s a selection criterion for the RITs. However, the FM capacities o f the local grantees are l ikely to be weak and may lack wel l qualified staff. Clear and adequate FM guidelines and good supervision by the RITs should address this problem.
The Sector Issue: 14. Investments have targeted specific regions. Although in the first phase this has been shown
to be highly effective, there are st i l l critical conservation needs in the original 14 hotspots and in other critical ecosystems that have not yet benefited under the program. In addition, C I revised the number o f hotspots up from 25 to 34 in 2005, though only 30 are eligible for Bank and GEF support. Strengthening o f the program in existing hotspots and expanding to other activities l ike marine ecosystems and new hotspots would maximize the overall impact o f the project. This project may inspire and help direct other donor investments to the hotspots.
RISK ASSESSMENT AND MITIGATION
15. The overall fiduciary risk is assessed to be moderate. C I receives grants f rom various other donors and i s subject to special reporting requirements which it has always met. However, i t i s important to note that C I could be in a position that would constitute a conflict o f interest as i t wil l be allowed to compete for the position o f RIT, in a competitive process. The organization fulfilling the position o f RIT in a region, whether C I or another organization, i s not allowed to receive grants in that region- see Annex 6 o n Institutional Arrangements which addresses conflict o f interest issue. In regions where C I i s not the RIT i t is allowed to apply for grants. In the case C I applies for the position o f RIT, the C I representative in both Working Group and Donor Council will recuse himself from participating in the decision to approve the selection o f the RIT. In regions where another organization serves as the RIT, al l decisions in regard to grants to C I below $20,000 will be made by the RIT in accordance with the ecosystem investment profile. For C I applications for grants above $20,000, the CEPF Secretariat would devolve review and decision-making to the CEPF Working Group, with input from the RIT, local advisory group and external review as appropriate. The C I member o f the Working Group would recuse himself from this process.
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16. The Operational Manual wil l be revised to outline the procedures to be followed where C I i s a potential grantee to address the issue o f conflicts o f interest. Adoption o f the revised Operational Manual i s a condition o f proj ect effectiveness.
The table below summarizes the risk analysis. With the appropriate risk mitigation measures as outlined the overall risk assessment i s moderate.
N
N
Y, Draf t amended OM i s ready before negotiation and adoption o f OM is condition o f effectiveness.
Risk
The CEPF Secretariat and the RITs are responsible for monitoring and supervising the grantees. The amended OM is intended to improve procedures for monitoring and implementation.
Training o n compliance with the Operational Manual needs to be provided to a l l RITs.
The internal audit wil l ensure compliance with the OM. Bank supervision wil l also be intensified.
Inherent Risk Country Level
Entity Level
Program Leve l
Control Risk
Risk Rating
M
H
M
H
Comment
Although the 14 hotspots are yet to be determined, it i s inevitable that in the targeted regions, a risk exists o f weak capacity and poor control environment. The FM capacity o f the EUTs is l ike ly to be relatively strong, since having an acceptable FM capacity i s one o f the criteria for RIT selection. The capacity o f the local grantees i s l ike ly be weak. N e w grantees might lack experience in the implementation o f a project.
The program wil l be implemented through c i v i l society partnership.
A high number o f community groups involved in sub-grant implementation, with varying degree o f capacity and sk i l l s . Therefore, ensuring adequate supervision and compliance is dif f icult .
Condition of Negotiations, Effectiveness
Mitigation
N
I
Residual Risk
M
M
M
52
Budgeting
Accounting
Internal Control
Funds F l o w
Spending plans prepared annually - Donor Counci l wil l on ly approve spending p lan consistent with resources available.
Delay o n approval o f Annual Spending documents may delay implementation, yet n o such delays have taken place during first phase o f CEPF. CI uses the Oracle Financials software for i t s computerized accounting system. The Oracle’s financial management package i s a robust system for reporting purposes in C I HQ and f ield offices. C I has formally established an internal audit function with a reporting l ine to the Audit Committee o f CI’s Board o f Directors. The Audit Committee approved the internal audit function and internal audit p lan in March, 2007. The function has been outsourced to Falletti Weber Consulting.
The CEPF Operational Manual describes pol icy and internal control procedures. C I conducts risk assessment o f projects before grants are awarded (Refer OM.4.2.5). Level o f risk determines follow-up actions including f ield visits. Disbursement o f grant funds can only commence after clearance by Directors and approval o f the Executive Director.
A program audit o f CEPF-2 focusing on economy, efficiency, and effectiveness wil l be conducted within 24 months f rom effectiveness
Based o n the successful experience f r o m phase 1, there i s a l o w risk o f
N
Y, TOR for internal audit p lan for CEPF program has to be reviewed and acceptable to the Bank by effectiveness.
Y, Draf t amended OM will b e ready before negotiation.
Y, TOR for program audit reviewed and acceptable to the Bank within 12 months o f effectiveness. N
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T o ensure adequacy o f scope and resources for internal audit function, the TOR, audit p lan and the arrangement have to be acceptable to the Bank.
Amended Manual will be adopted, including clear rules related to conflict o f interest.
M
7 Audit ing
grantees not receiving funds in timely manner. See Above comment o n Accounting N o qualif ication has been provided by the external auditors during the audits o f fust phase o f CEPF, but the scope o f audit did not cover internal control and compliance in the last two years. A separate audit opinion o n CEPF fund (as an accompanying fimds accountability statement) i s part o f the Bank’s audit requirements.
N
Y, TOR for external audit t o be reviewed and acceptable to the Bank within 4 months f r o m effectiveness.
The TOR i s expected to also cover a review o f internal controls, including administrative, supervision, monitoring and oversight arrangement at the R ITs and grantee levels over the use o f CEPF funds. The audit report is t o b e submitted to the Bank within f ive months after close o f financial year.
M
H - High S- Substantial M - Moderate L - L o w
STRENGTHS AND WEAKNESSES
17. The project has several strengths and weaknesses. A 2005 independent evaluation o f the CEPF has been very positive which suggests that the overall strengths o f empowering NGOs, community groups and other c iv i l society groups at local and provincial level approach outweigh the weaknesses. However, among the recommendations o f the report are issues such as the need to strengthen performance monitoring and to better address conflict o f interest and allocation o f financial resources for grant making. Accordingly strengthened institutional arrangements have been put in place for CEPF-2 - see Annex 6 (Implementation Arrangements).
18. The overall development objective o f the project emphasizes the need for better engagement o f local c iv i l society groups, including NGOs. Strengths include:
Region-specific investment strategies (ecosystem profiles) are developed together with a wide range o f stakeholders, to ensure that regional priorities are identified and agreed.
Community and c iv i l society groups have stronger ownership o f project which may build national and local capacity.
Communities receive the finds directly in their bank account and manage implementation o f project, minimizing the number o f intermediate transactions.
CEPF has the potential to complement conservation efforts in those Bank client countries with modest conservation finding.
CEPF promotes good environmental governance.
CEPF outlines guidelines for grant-making and implementation under an Operational Manual, to be revised and updated for CEPF-2.
RITs have been very effective in linking with smaller grassroots activities and also wi th governments. The capacity o f RITs to supervise and assist the community
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groups i s likely to be relatively strong. Both adequate supervision and assistance capacity are selection criteria for the RITs.
19. Some weaknesses noted in the 2005 Independent Evaluation, as wel l as in the FM assessment, are as follows: . Capacity o f small community organizations and NGOs to manage and implement the
sub-grants may be weak.
The perception o f CI’s dual role/conflict o f interest. C I i s not only the CEPF Secretariat but it may also be eligible to be a RIT or a grantee in specific hotspots (cannot be both in same hotspot).
The multi-region grants may overlap with other projects which may create risk o f double counting.
Highly automated financial system and online reporting disadvantaged the small regions with no access to internet.
20. These weaknesses may create some r isks in the project implementation. The perception o f CI’s dual role is the main issue that may stand out from the rest o f the noted weaknesses. However, CEPF has strengthened i t s institutional arrangements to reduce potential conflict o f interest. This means that any RIT, whether C I or another organization, wil l not be eligible to apply for grants within the hotspot they manage.
.
.
.
FINANCIAL MANAGEMENT ARRANGEMENTS
Following are the FM Arrangements for the Project:
1. Implementing entity and Staffing 21. The program wil l be implemented by C I which i s currently hosting the CEPF Secretariat
on behalf o f the CEPF donors. C I was incorporated in the State o f California on January 26, 1987 as a nonprofit charitable organization. CI’s mission is to conserve the Earth’s living heritage, the global diversity, and demonstrate that human societies are able to live harmoniously with nature. C I works with nationals o f each country in which it operates to develop management capacity for biodiversity conservation, including management of protected areas and more sustainable resource management. C I i s overseen by a Board o f Directors. I t has total staff strength o f about 1000 worldwide and i s represented in 40 countries o f which 24 have field offices.
22. The Finance division o f C I which handles al l financial responsibilities for C I meets the minimum requirements o f the Bank. I t i s responsible for financial reports on CEPF. The CEPF Executive Director, the C I Senior Vice President, i s the head o f the CEPF Secretariat, which includes 16 staff members.
23. The program wil l be maintained by both C I at Headquarters and also from their field offices therefore ensuring reconciliation and counterchecking controls are in place. The Oracle’s Financials feature for development projects will provide the necessary information needed to prepare reports for the program. Signed grant commitments and disbursements are maintained in Oracle and reconciled on a quarterly basis. Cash i s
55
disbursed to grantees based on acceptance o f quarterly financial reports and cash projections for the following te rm 30 days after the end o f the quarter. The CEPF Secretariat wil l review the financial reports. The IFR is prepared based on financial information from Oracle that includes signed grant agreements and cash payment to date and send to the Bank 45 days after the end o f the quarter.
2. Budgeting
24. The project wil l be using CI’s budgeting system which i s linked and interfaced to i t s FM system - Oracle Financials. C I shall prepare an annual budget (Annual Spending Plan) for review and approval by the Donor Council taking into account the fimding levels o f the proposed spending categories for the Fund during the next calendar year.
The Annual Spending Plan wil l include four categories:
(a) the finding levels for each approved Ecosystem Profile, together with a description o f the types o f projects and activities to be financed at the programmatic level, based on the funding strategy in the Ecosystem Profile;
calendar year; (b) a Preparation Budget for new Ecosystem Profiles to be prepared during the
(c) the Operational Budget; and
(d) a management fee for the category (c) above calculated on the basis o f CI’s audited annual rates (indirect costs) for the previous year.
3. Accounting
25. C I uses Oracle Financials as i t s accounting and human resources software. C I field offices also maintain their financial records in Oracle and submit files monthly for review and consolidation. As per CI’s Record Maintenance Policy, records associated with these transactions are kept at C I headquarters and in the field offices for no less than three full years after the transaction. C I undergoes annual financial and federal compliance audits conducted by an independent audit firm. Currently this i s done by Price Waterhouse Coopers.
4. Internal Control
26. The project wil l be implemented in the same way as al l other donor financed projects at C I and will be subject to the same control mechanisms.
27. C I conducts risk assessments o f sub-projects before grants are awarded. The risk assessment model i s only intended to be used for projects with a proposed grant to recipients o f more than $20,000. Grants below $20,000 are awarded by the RITs. The risk assessment i s divided into two separate parts which i s programmatic risk and financial risk. The programmatic risk is performed by the RIT, and the financial risk will be
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conducted by a finance staff member from CI. The assessments are by way o f questionnaires as per OM 4.2.5.
Disbursement Category
28. The CEPF Operational Manual clearly defines administrative and accounting procedures hence C I should continue to use this as an effective method o f ensuring internal controls are in place and are followed.
Amount of the GEF Grant in USD
Expenditures T o Be Financed
5. Fund Flow and Disbursement arrangements
29. The fund f low for the GEF funds would be from the GEF Trust Account maintained by the World Bank to the Designated Account. C I wil l disburse funds directly f rom the Designated Account to external grantees. Subject to the RITs grant-making authority for grants o f $20,000 and less, C I will also disburse funds from the Designated Account to grantees contracted by the RITs. C I will link grant disbursements to estimated expenses, so that excess cash i s not in grantees bank accounts. Counterpart funds wil l also fol low the same flow.
The table below summarizes the proposed disbursement arrangement:
I Ecosystem Grants I $20,000,000 I 26.3% I 1 TOTAL 1 $20,000,000 1 I
30. Disbursement mechanism for sub-grants Ecosystem Grants. The GEF funds will be disbursed from C I to the grantees against the sub-grant agreements, which specify the number o f installments, and conditions for each payment. The payments made to the grantees in accordance with the sub-grant agreements are considered as eligible expenditures for disbursement purposes. Any un-used funds received by the grantees wil l be refunded to the C I fund account, and subtracted from the reported eligible expenditures. These funds are then available for other grants in the approved region.
6. Financial Reporting
3 1. The project shall be required to submit the quarterly Interim un-audited Financial Report (IFR) which consists o f at least:
1. Quarterly Sources and Uses o f Funds; 2. Project Cash Forecast; and 3. Designated Account Act iv i ty Statement
7. Audit Arrangements
32. Internal Audit (IA). There i s no formal independent Internal Audit unit for this project. However, C I i s in the process o f formally establishing an internal audit function for C I
57
with a reporting l ine to the Audit Committee o f CI’s Board o f Directors. The Audit Committee approved the internal audit function and internal audit plan at their meeting in March, 2007. The function has been outsourced to Falletti Weber Consulting firm, and the program has already been launched.
Action Plan
33. Program Audit. In l ieu o f a regular internal audit o f CEPF-2, a program audit o f CEPF-2 wil l be conducted within 24 months from the date o f effectiveness in accordance with a TOR acceptable to the Bank, including review o f economy, efficiency and effectiveness in relation to the objectives o f the CEPF program. A copy o f the report will be furnished to the Bank. In addition there wi l l be regular monitoring o f projects by CEPF Secretariat, supervision visits f rom the Bank and the annual external audits.
Expected Output I DueDate
34. External Audit. The consolidated annual audit o f C I i s being carried out by an external auditor, currently Price Water House Coopers, LLD. The audit i s being presented on the accrual basis o f accounting. CEPF has i t s records, accounts and financial statements audited annually, in accordance with appropriate auditing principles consistently applied, by an independent auditor (currently Price Waterhouse Coopers). In addition, CEPF’s risk assessment procedures require that a l l grantees receiving over $100,000 and al l high risk grantees over $20,000 provide annual independent audits to CEPF.
35. A separate audit opinion on the CEPF annual fund accountability statement will be conducted in accordance with the TOR acceptable to the Bank and submitted to the Bank as part o f the Bank’s audit requirements. The CEPF audit report wil l be submitted within five months after the end o f the financial year.
8. Action Plan
36. Fol lowing i s the mitigating FM action plan:
. , Revised OM to include procedures to be fol lowed by a l l implementing units o f the project. This should include a l l f inancial management and disbursement procedures for t h i s project at a l l level o f implementation o f the project, covering operations for phase 11, including procedures for (a) confl ict o f interest, (b) financial management and disbursement, particularly related to advances and their accountability procedures), (c) project cycle management, (d) grant management, including grant agreement and reporting templates, and (e) the terms o f reference and selection process for Regional Implementation Teams, (9 IFR formats, (g) C I and RIT’s supervision o n project implementation by local grantees, and (h) internal audit arrangements.
Final draft OM for review by the Bank
Adoption o f f inal O M acceptable to the Bank as evidenced through a Letter o f No-Objection.
BY Negotiations (Completed)
BY Effectiveness
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B. Training Training for RITs’ staff who wil l require the necessary s l u l l s t o carry out respective duties as described in the OM
C. Internal Audit 1. Establishment o f internal audit function for C I with adequate TOR, work program, and reporting l ine to the audit committee consistent with international best practices.
2. Agreement o n TOR for program audit to assess economy, efficiency and effectiveness in relation to achieving the CEPF objectives. 3. Completion o f a program audit o f CEPF 2 in accordance with theTOR acceptable to the Bank
D. Annual Audit 1. Adoption o f a t ime bound action p lan to address outstanding audit recommendations arising f rom 2006 audit. 2. Satisfactory implementation o f outstanding external audit recommendations.
3. Arrangement o f the project annual audit in accordance with a specific TOR acceptable to the Bank. The TOR is expected to also cover a review o f internal control, including administrative, supervision and monitoring arrangements at the RITs and sub-grantee levels, over the use o f the grants. The audit expected to be conducted by independent auditors acceptable to the Bank and the audit report expected to be submitted to the Bank within f ive months after the closing o f the financial year. E. Donor Council Clarifying the role and responsibility o f the Donor Council, particularly with respect to oversight o f audit, including approvinglendorsing scope o f external and internal audit plans. Any deviation f rom the agreed scopes must b e concurredendorsed by the Donor Council.
OM training
-Internal audit function established (in case that the function i s outsourced, the TOR, audit p lan and the arrangement have to be acceptable to the Bank).
Adoption o f f inal Operational Manual, acceptable to the Bank.
-A comprehensive program audit o f CEPF.
C I audit recommendation action p lan acceptable to the Bank.
Confinnation f r o m the auditor o n the completion o f a l l audit recommendation. TOR for external audit acceptable to the Bank.
Adoption o f f i a l OM acceptable to the Bank as evidenced through a letter o f no- objection.
Training wil l be conducted to individual RITs witlun 90 days o f appointment.
- B Y Effectiveness.
- B Y Effectiveness. Within 12 months f r o m effectiveness. Within 24 months f r o m effectiveness
Completed
Annual Basis
Within 120 days f o r m effectiveness.
BY effectiveness
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Effectiveness Conditions:
satisfactory to the IBRD shall have been furnished to the IBRD demonstrating that: This Agreement shall become effective on the date that evidence in form and substance
a.
b.
C.
d.
e.
the Donor Council has approved the fund-raising strategy referred to in Section 5.01 o f the Financing Agreement; the Donor Council has approved an indicative l i s t o f Biodiversity Hotspots selected for investment under the Fund; the Donor Council has approved the revised Operational Manual; C I has established an internal audit function, with staffing, resources and functions based on terms o f reference satisfactory to IBRD; and Execution and delivery o f the Agreement on behalf o f C I has been duly authorized by al l necessary corporate action and, upon execution and delivery, the Agreement shall constitute the legal, valid, binding and enforceable obligation o f each Party hereto.
Dated Covenant: a. Adoption o f TOR for external audit acceptable to the Bank, within 120 days o f project
effectiveness. b. Agreement on TOR for program audit to assess economy, efficiency and effectiveness in
relation to achieving the CEPF objectives, within 12 months o f project effectiveness. c. Completion o f a program audit o f CEPF by the internal auditor within 24 months o f
project effectiveness.
9. Supervision Plan
37. The program that is ending did not include Bank Financial Management Specialist in i t s supervision missions. Therefore i t i s critical for this proposed program to include a F M S in the supervision mission so as to ensure that the grant proceeds are used for the purposes for which i t was granted with due regard to economy, efficiency and the achievement o f the program’s objectives and the FM risk o f the project.
38. The nature o f this review would include a review o f a sample o f completed projects including their validation with comparison to the corresponding cost and funds spend on them. Reasonableness o f the funding should be checked. An overall review o f program contracts as well as the physical accomplishments and funds disbursed should be made. The supervision should address the total project financial arrangements.
39. The overall risk rating for the project i s Moderate and it i s envisaged that FM monitoringhupervision missions would be required at most o n a semi-annual basis. The supervision should be conducted by at least a qualified FMS.
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Annex 8: Procurement Arrangements GLOBAL: Second Critical Ecosystem Partnership Fund Project
Since the GEF funds will b e disbursed as Ecosystems Grants, the procurement arrangements are out l ined in the Annex 6: Implementat ion Arrangements.
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Annex 9: Economic and Financial Analysis GLOBAL: Second Critical Ecosystem Partnership Fund Project
This annex i s not required for this project.
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Annex 10A: Safeguard Policy Issues GLOBAL: Second Critical Ecosystem Partnership Fund Project
1. The project falls under the World Bank environmental category “C” classification. O f the World Bank’s ten safeguard policies, O P B P 4.01 on Environmental Assessment, OP/BP 4.12 on Involuntary Resettlement, OP/BP 4.10 on Indigenous Peoples, and OP/BP 4.36 on Forests are triggered. Although OP/BP 4.04 on Natural Habitats and OP/BP 4.1 1 on Physical and Cultural Resources are not triggered by this project, they are included here for completeness. A process framework (PF) for involuntary restrictions and an Indigenous Peoples Planning Framework (IPPF) have been prepared. An Operational Manual provides guidance and criteria for evaluation, management and implementation o f the grants under CEPF-2, including compliance with the Bank’s safeguard policies.
2. CI’s Board o f Directors adopted an Indigenous Peoples pol icy in 2003. All CEPF operations are guided by the Operational Manual and relevant safeguard policies are incorporated into project development and monitoring processes.
3. Environmental assessment (OP 4.01). The project will address priori ty conservation objectives and i s thus expected to have a highly positive environmental impact. If implemented as planned, the project would have no significant adverse environmental effects. Project activities wil l be selected on a competitive basis according to criteria that wil l ensure that resources are directed to the most important biodiversity issues while ensuring minimum adverse environmental effects. Current screening criteria outlined in the operational manual wil l identify projects with potential adverse impacts at the grant proposal stage.
4. Natural Habitats (OP 4.04) and Forests (OP 4.36). This project is fully consistent with the Bank’s Natural Habitats and Forest policies. I t would not cause, nor facilitate, any significant loss or degradation o f forests or other natural habitats. By design, CEPF would finance activities that promote conservation o f natural habitats and threatened species. The project i s intended to prevent, or reduce, habitat loss or degradation by providing strategic assistance to engage NGOs, community groups, and other c iv i l society partners in conservation in biodiversity hotspots.
5. Project activities will focus on conservation and more sustainable management o f forests and other natural habitats and al l project activities wil l be consistent with conservation priorities. Projects are expected to promote positive environmental benefits and conservation o f biodiversity through creation o f new protected areas, strengthening o f protected area management, promoting sustainable use and management o f natural resources and creation o f conservation partnerships for more effective management both within protected areas and important biological corridors. I t i s expected that any activity funded by CEPF would be consistent with existing protected area management plans or other resource management strategies are applicable to local situations. Beyond the selection criteria for identifying project activities, i t i s not anticipated that any additional measures wil l be required under this policy.
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6. Socioeconomic impacts. The f i rst phase o f the CEPF program awarded grants to more than 570 c iv i l society partners in 15 regions, ranging from international and national NGOs to local communities, indigenous groups and the private sector. CEPF-2 would replicate this successful implementation model in at least 14 hotspots. In order to give explicit attention to social safeguards issues, a desk review was undertaken o n current CEPF projects with the objectives to assess their potential social impacts, to consider measures to address such impacts and to consider eligibility criteria for the screening process for CEPF-2. Eighteen projects were reviewed along with the Operational Manual and Five Year Assessments and other project documents. This review informed a set o f recommendations for revisions to the Operational Manual to address the requirements o f the World Bank’s social safeguard policies, particularly the Indigenous Peoples Policy (OP 4.10) and the Involuntary Resettlement Policy (OP 4.12).
7. Many o f the projects under CEPF-2 are expected to be small-scale and provide positive impacts for local communities, including greater empowerment o f local c iv i l society groups to participate in active conservation and natural resource management. Direct positive impacts include creating employment opportunities, promoting community management o f natural resources, development o f ecotourism and capacity building. However, some projects may have the potential for adverse impacts on the livelihoods o f local populations, particularly in the short te rm prior to implementation o f more sustainable management practices. These include projects that result in some form of restrictions o f access to natural resources, projects that induce changes in livelihood and natural resource practices, and projects that affect Indigenous Peoples.
8. Involuntary Resettlement (OP/BP 4.12). This pol icy covers both impacts from activities that require resettlement or land acquisition, and projects that result in restrictions of access to legally designated parks and protected areas. Activities involving resettlement or land acquisition are not allowed under the CEPF program. Restrictions o f access to resources are addressed through preparation o f a Process Framework that describes the process and principles for determining restrictions and mitigation measures with the participation o f affected persons. All project applications wil l be assessed for potential to reduce access to resources. The process for preparation o f an Involuntary Restriction Framework, with appropriate off-set management or compensation measures i s outlined in the revised Operational Manual - see Annex 1OC.
9. Indigenous Peoples (OP/BP 4.10). Many o f the world’s remaining areas o f high biodiversity overlap with lands occupied and utilized by Indigenous Peoples. Final selection o f CEPF hotspots i s dependent on Donor Council decisions but CEPF-fbnded activities could impact indigenous communities in several potential hotspots. Individual project activities would be selected at the ecosystem level but i t i s expected that Indigenous Peoples, as well as other c iv i l society actors, will particip’te in identifying conservation priorities and have access to CEPF grants. The project would explicitly encourage proposals that support Indigenous peoples and other local communities in community-based conservation and activities that enhance local communities tenure and sustainable resource management. Additionally, a l l projects proposed for CEPF funding
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would demonstrate that they have made provisions for evaluating the potential impacts on indigenous communities and site-specific action plans may be required.
10. Physical Cultural Resources (OP 4.11). CEPF-2 project proposals are unlikely to have any adverse impacts on physical cultural resources (defined as movable or immovable objects, sites, structures, and natural features and landscapes that have archeological, paleontological, historical, architectural, religious, aesthetic, or other cultural significance). These may, however, be present in project areas and measures should be in place to ensure that they are identified and adverse effects avoided. This i s particularly relevant for projects which support development o f management plans and other land and natural resource use planning, projects that support alternative livelihoods, and projects that include infrastructure construction, however minor (e.g. park shelters, boundary markers). These requirements are described in the Operational Manual.
11. Based o n review o f lessons from the CEPF program to date, explicit guidance and clarity on the application o f safeguard policies have been prepared for CEPF-2, including an Indigenous Peoples Planning Framework (IPPF) and Process Framework for Involuntary Restrictions. These frameworks include the requirement for Regional Implementation Teams (RITs) to consider alternatives to minimize adverse safeguard-related impact in their decision on grant applications. The IPPF and Process Framework for the overall CEPF-2 project and for individual ecosystem profiles and sub-projects wil l be disclosed at the Bank’s Infoshop. As needed, specific instruments wil l be developed for sub-projects funded by CEPF-2.
12. Clear requirements and guidelines for projects affecting resource use and Indigenous peoples have been incorporated into the revised Operational Manual. Specific revisions include greater emphasis on consultation and participation. Ecosystem Profiles would include descriptions o f local communities and other key stakeholders, land tenure and customary use rights issues. To further strengthen openness and transparency, there will be full disclosure o f ecosystem profiles and protected area projects with al l affected communities. Under CEPF-2 there wil l also be a greater emphasis on stakeholder participation in formulating indicators and monitoring and evaluation o f proj ect outputs and outcomes.
13. Procedures to address safeguards issues in individual projects are outlined in the Operational Manual. Grant applicants would f i rst assess whether their projects may pose safeguard issues with additional screening by CEPF RITs and Grant Directors as part o f proposal review, with mitigation measures put in place as needed. Grant application forms have been revised as have the sections dealing with decision making and r i s k analysis. CEPF staff wil l also monitor for potential safeguard issues during implementation. As part o f start up operations, safeguard training wil l be provided by Bank staff to key CEPF secretariat staff including regional Grant Directors and the head o f the Grants Management Unit, who routinely monitor compliance with CEPF policies and procedures. Training will also be provided on safeguards issues for the Regional Implementation Teams in each selected ecosystem.
GLOBAL: Second Critical Ecosystem Partnership Fund Project
1.
2.
3.
Many biodiversity hotspots overlap with lands or territories traditionally owned, customarily used or occupied by Indigenous Peoples. During the first phase o f CEPF individual projects have provided positive impact on indigenous communities, e.g. support to community based management o f protected areas or indigenous territories. It i s expected that Indigenous Peoples, as well as other c iv i l society actors, will participate in identifying conservation priorities and have access to CEPF grants during CEPF-2. However, as CEPF aims to protect critical ecosystems, the possibility remains that some project activities might affect the current livelihoods o f Indigenous Peoples. These include projects that adversely affect Indigenous Peoples’ particular rights (formal and/or customary) to the land and natural resources, and projects that induce change in livelihood and natural resource use practices.
K e y requirements o f the Indigenous Peoples Policy include: (i) a social assessment; (ii) a process o f free, prior and informed consultation with the affected Indigenous Peoples’ communities to fully identify their views and to obtain their broad community support to the project; (iii) the preparation o f an Indigenous Peoples Plan or an Indigenous Peoples Planning Framework; and (iv) disclosure o f the Indigenous Peoples Plan or Planning Framework.
The Planning Framework outlines the key guiding principles, criteria and procedures which the project wil l fol low in such cases, to ensure that eligible, affected persons are assisted in their efforts to restore or improve their livelihoods in a manner which maintains the environmental sustainability and territorial integrity o f the relevant protected areas. These requirements are described below and should be read together with the Operational Manual as wel l as the Process Framework for Involuntary Restrictions.
Screening for Indigenous Peoples
4. CEPF applicants are required to screen for the presence o f Indigenous Peoples early on in project preparation. This could be done when preparing the Letter o f Inquiry, but should otherwise be done as preparation o f a project proposal application begins. The characteristics o f Indigenous Peoples mentioned in OP 4.10 wil l be used. If i t i s uncertain whether local communities can be considered as Indigenous Peoples, applicants should consult with the communities, local NGOs, knowledgeable experts and government representatives as appropriate. In situations o f disagreement or controversy they may seek guidance from CEPF staff, who may seek guidance from the World Bank as needed.
Social assessment
5. Where Indigenous Peoples are present in the project area, the Applicant assesses the particular circumstances o f affected indigenous communities. The social assessment includes the project’s potential positive and adverse impacts, and i s used to inform project preparation to ensure that project activities are culturally appropriate, wil l enhance benefits
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to target groups and are l ikely to succeed in the given socio-economic and cultural context. The level o f detail o f the social assessment depends on project activities and their impacts on local communities and should be agreed between the Applicant and CEPF staff before proceeding with the project application. If the project i s small and has no or few adverse impacts, this assessment i s done as part o f early project preparation by the Applicant, mainly based on secondary sources and the Applicant’s own experience working in the area. In larger and more complex projects, the assessment may be a separate exercise done by the Applicant or contracted experts as appropriate and may include primary research.
6. The findings o f the social assessment are described in a separate report and reflected in the project proposal application. For small scale projects with no direct impacts on indigenous communities, the report i s short and includes a br ie f overview o f the indigenous communities, project activities as they relate to the local communities, how project implementation wil l address the particular circumstances o f Indigenous Peoples, and how they wil l participate and be consulted during implementation. For more complex projects a more elaborate report i s required, which should include the fol lowing elements: a description o f the legal and institutional framework applicable; baseline information on the demographic, social, cultural and political characteristics o f the affected indigenous communities, and the territories and natural resources on which they depend and which they traditionally own, use or occupy; a description o f key project stakeholders and an elaboration o f a culturally appropriate process for consultation and participation during project implementation; and the conclusions o f the free, prior and informed consultation with the affected indigenous communities.
Free, prior and informed consultation
. The Applicant undertakes a process o f free, prior and informed consultation with the affected Indigenous Peoples’ communities during project preparation. In most cases, this process i s best done as part o f the social assessment although consultations are l ikely to continue after completion o f this assessment. The extent o f consultations depends on the project activities and the circumstances o f affected Indigenous Peoples. For projects with no impacts or direct interventions with the indigenous communities, indigenous communities are informed about the project, asked for their views, and assured that they wil l not be affected during project implementation. For projects affecting indigenous communities, whether positively or adversely, a more elaborate consultation process is required. This may include, as appropriate: information about project objectives and activities; discussion o f possible adverse impacts and ways to avoid or mitigate them; discussion o f potential project benefits and how these can be enhanced; assessment o f land and natural resource use and how management may be enhanced; identifying customary rights to land and natural resource use; identifying and discussing (potential) conflicts with other communities and how these might be avoided; ways to elicit and incorporate Indigenous Knowledge into project design; facilitating the affected communities’ broad support to the project; developing a strategy for indigenous participation and consultation during project implementation, including monitoring and evaluation.
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8. All project information provided to Indigenous Peoples should be in a form appropriate to local needs. Local languages should usually be used and efforts should be made to include al l community members, including women and members o f different generations and social groups (e.g. clans and socio-economic background).
Indigenous Peoples Plan
9. Based on the consultation and social assessment processes, project design i s refined and particular measures and instruments are prepared to address issues pertaining to Indigenous Peoples. This may be done in combination with instruments addressing involuntary restrictions on access to natural resources (a Process Framework) in accordance with OP 4.12 on Involuntary Resettlement. The documents are prepared with the participation o f affected indigenous communities during the consultation process.
10. The instrument to address the concerns and needs o f Indigenous Peoples i s usually an Indigenous Peoples Plan (IPP). In the case o f a project such as CEPF-2, with multiple sub- projects not identified during preparation, an Indigenous Peoples Planning Framework (IPPF) describes the planning and implementation process. Where “Indigenous Peoples are sole or the overwhelming majority o f direct project beneficiaries,” the elements o f an IPP should be included in project design. In this case a separate IPP i s not required but the project application provides details on how Indigenous Peoples’ issues wil l be addressed during implementation.
1 1. The contents o f the IPP depend on the project activities and impacts on Indigenous Peoples. It may be appropriate to include a process o f further social analysis and consultations during project implementation to determine specific activities. At minimum the IPP should include a description o f the Indigenous Peoples affected by the project; summary o f the proposed project; detailed description o f the participation and consultation process during implementation; description o f how the project wil l ensure culturally appropriate benefits and avoid or mitigate adverse impacts; budget; mechanism for complaints and conflict resolution; and the monitoring and evaluation system that includes monitoring o f particular issues and measures concerning indigenous communities. The fol lowing elements and principles may be included in the IPP, as appropriate:
. Specific measures for implementation, with clear timetables o f action and financing.
Formal agreements reached during the free, prior and informed consultation during project preparation.
Clear output and outcome indicators developed with affected Indigenous Peoples.
Project design should draw upon the strengths o f Indigenous Peoples Organizations and the affected communities and take into account their languages, cultural and livelihood practices, social organization and religious beliefs. I t should avoid introducing changes that are considered undesirable or unacceptable to the Indigenous Peoples themselves.
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Efforts should be made wherever possible and appropriate to incorporate, Indigenous Knowledge and local resource management arrangements into project design, including special measures for the recognition and support o f customary rights as appropriate.
Special measures concerning women and marginalized generational groups.
Capacity building activities for the indigenous communities to enhance their participation in project activities may be u s e h l or necessary; this may include general literacy courses.
Grievance mechanism taking into account local dispute resolution practices and norms.
Participatory monitoring and evaluation adapted to the local context and capacity.
Disclosure
12. Before finalizing an IPP (or IPPF) a draft should be disclosed together with the social assessment report (or i t s key findings) in a culturally appropriate manner to the affected Indigenous Peoples. Language i s critical and the IPP should be disseminated in local languages or other forms easily understandable to affected communities, including oral communication.
13. After the CEPF Secretariat has reviewed and approved the IPP and proposed project for hnding, the Grantee shares the final IPP (or IPPF) again with affected communities. The final IPP (or IPPF) is also disclosed at the CEPF website.
Roles and Responsibilities
14. Applicants, and subsequently Grantees, are responsible for following the requirements o f the World Bank’s Indigenous Peoples Policy as described in this IPPF. They wil l ensure that Indigenous Peoples are consulted and benefit in culturally appropriate ways. They will avoid adverse impacts on indigenous communities, or, where this i s not possible, develop with the affected communities measures to mitigate and compensate for such impacts. Grantees are responsible for reporting to both affected indigenous communities and the CEPF Secretariat on project progress and any unexpected and unintended events affecting Indigenous Peoples.
15. The CEPF Secretariat has the overall responsibility for the implementation o f the IPPF to ensure that CEPF-2 grants encourage the participation o f Indigenous Peoples in project activities in culturally appropriate ways. The specific responsibilities o f the Secretariat and Grantees are described in the CEPF-2 Operational Manual.
Budget, Monitoring and Evaluation
16. Grantees are responsible for ensuring adequate budgets for implementing IPPs and other measures concerning Indigenous Peoples.
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17. The CEPF Secretariat i s responsible for setting aside sufficient fbnds for implementing this IPPF. This includes costs for providing information about the IPPF, reviewing and monitoring o f CEPF-2 projects, and costs for consulting Indigenous Peoples on the Ecosystem Profiles.
Grievance Mechanism
18. Indigenous Peoples and other local communities and stakeholders should be able to complain at al l times to Applicants / Grantees and the CEPF Secretariat about any issues covered in this IPPF and the application o f the World Bank’s pol icy on Indigenous Peoples. Affected communities should be informed about this possibility and contact information o f the respective organizations at relevant levels should be made available.
19. As a f i rs t stage grievances should be made to the Applicant / Grantee. The Applicant / Grantee i s required to respond to grievances in writing (supported by other forms o f communication as needed) within fifteen working days o f receipt; claims should be filed, included in project monitoring, and a copy o f the grievance should be provided to the CEPF Secretariat. If the claimant i s not satisfied with the response, the grievance may be submitted to the CEPF Secretariat. The Secretariat is required to respond within fifteen working days o f receipt; claims should be f i led and included in project monitoring.
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Annex 1OC: Summary Process Framework for Involuntary Restrictions
GLOBAL: Second Critical Ecosystem Partnership Fund Project
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Many projects under CEPF-2 would be relatively small in scale and may benefit local communities through support for community-based conservation. Nevertheless potential adverse social impacts could arise from projects that restrict access to natural resources, projects that induce changes in livelihoods and resource use, and projects that affect Indigenous Peoples.
CEPF projects triggering the World Bank’s pol icy on Involuntary Resettlement include projects that introduce involuntary restrictions o f access to legally designated parks and protected areas or support efforts to improve enforcement o f existing restrictions. This may involve restriction to resources such as wildlife, non-timber forest products (NTFPs) and production areas (including rotational (swidden) agricultural plots in active use or temporarily fallow).
The Framework does not apply to projects that provide incentives to change livelihood and natural resource use practices on a voluntary basis. However if alternative livelihoods do not materialize or are inadequate to maintain the same level o f livelihood, local communities may be adversely affected. In some cases it would be usefu l to develop a Process Framework. In any case, adverse social impacts on local communities should be avoided or appropriately mitigated.
The requirements o f the World Bank’s pol icy include (1) the development o f a project- specific Process Framework during project preparation which describes the project and implementation process, and (2) the development o f a Plan o f Action during project implementation which describes the agreed restrictions, management schemes, measures to assist the displaced persons and the arrangements for their implementation.
Process Framework
5. Participation o f affected communities i s the key element o f the Process Framework, as stressed in the World Bank’s pol icy OP 4.12. Affected communities have the right to participate in deciding the nature and scope o f restrictions and the mitigation measures, and should participate in the drafting o f the Process Framework. The CEPF Secretariat will provide guidance as appropriate to Grantees during the process and wil l review and approve the final Framework prior to approving the final project proposal application.
6. The level o f detail o f the Process Framework may vary depending on project activities, characteristics o f restrictions and their impacts, and the number o f persons affected, and should be agreed between the Applicant and CEPF staff during the project preparation process. In some cases a simple Framework can be prepared by the Applicant with input from local communities. In more complex or larger projects, the preparation o f the Framework may be supported by social analysis or surveys during preparation to assess the local context, particularly land and natural resource use practices and management
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7.
A.
8.
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systems. Input from other organizations and experts knowledgeable about the communities may be useful.
The Process Framework wil l describe the project and how restrictions o f access to natural resources and measures to assist affected communities will be determined with the participation o f affected communities. The Process Framework should include the following elements:
Project Background
The Framework wil l briefly describe the project and local context, how the project was prepared, including the consultations with local communities and other stakeholders, and the findings o f any social analysis or surveys that informed project design. I t will describe project activities and potential impacts from these.
Participatory Implementation
This section will detail the participatory planning process for determining restrictions, management arrangements and measures to address impacts on local communities. The roles and responsibilities o f various stakeholders and the methods o f participation and decision-making should be described; decision-making may include the establishment o f representative local structures, the use o f open meetings, and involvement o f existing local institutions. Methods o f consultation and participation should be in a form appropriate to local needs, including local languages, and efforts should be made to include al l community members, including women and members o f different generations and social groups.
10. Any decisions should be made based on well-founded understandings o f the biological and socio-economic contexts. It i s common to include some form o f participatory social assessment to inform the decision-making process to develop a more in-depth understanding o f (a) the cultural, social, economic and geographic setting o f the communities in the project areas; (b) the types and extent o f community use o f natural resources, and the existing de jure and de facto ru les and institutions for the use and management o f natural resources; (c) identification o f village territories and customary use rights; (d) local and indigenous knowledge o f biodiversity and natural resource use; (e) threats to biodiversity f rom various activities in the area, including those o f local communities; ( f ) the potential livelihood impacts o f new or more strictly enforced restrictions on use o f resources in the area; (g) communities’ suggestions and/or views on possible mitigation measures; (h) potential conflicts over the use o f natural resources, and methods for solving such conflicts; and (i) strategies for local participation and consultation during implementation, including monitoring and evaluation.
1 1. I t i s important to pay particular attention to land tenure issues, including traditional land rights and obligations and use o f natural resources by different local communities. Areas used to collect non-timber forest products (NTFP) and for shifting cultivation should not be exposed to restrictions unless this i s necessary for the conservation o f important
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biodiversity and appropriate agreements with local communities can be made. Biological assessments and threat analysis are useful tools to ensure that restrictions wil l be informed by real threats rather than assumptions about the impacts from local communities’ natural resource use practices.
C. Criter ia for eligibility o f affected persons
12. The Framework describes how the local communities wil l participate in establishing criteria for eligibility for assistance to mitigate adverse impacts or otherwise improve livelihoods. In cases with significant consultations and social analysis during preparation these criteria may be included in the Framework, but in most cases they wil l be developed, or at least refined, during implementation as part o f a participatory social assessment process.
13. The eligibility criteria would determine which groups and persons are eligible for assistance and mitigation measures. The criteria may exclude certain persons or groups from assistance because their activities are clearly illegal, unsustainable and destructive (e.g. wildlife poachers, dynamite fishers). The criteria may also distinguish between persons utilizing resources opportunistically and persons using resources for their livelihoods, and between groups with customary rights and non-residents or immigrants.
14. The Framework should identify vulnerable groups, including forest dwellers, Indigenous Peoples, and groups or households highly dependent on natural resources, and describe special measures to ensure that these groups wil l participate in, and benefit from, project activities.
D. Measures to assist the affected persons
15. The Framework should describe how groups or communities wil l be involved in determining measures that wil l assist affected persons in managing and coping with impacts from agreed restrictions. The common objective is to improve or restore, in real terms, to pre-displacement levels, their livelihoods while maintaining the sustainability o f the protected area. In some circumstances affected communities may agree to restrictions without identifying one-for-one mitigation measures as they may see the long term benefits o f improved natural resource management. Possible measures to offset losses may include, inter al ia: special measures for the recognition and support o f customary rights to land and natural resources; transparent, equitable and fair ways o f more sustainable sharing o f the resources; access to alternative resources or functional substitutes; alternative livelihood activities; health and education benefits; obtaining employment, e.g. as park rangers or eco-tourist guides; and technical assistance to improve land and natural resource use. These measures should be in place before restrictions are enforced, although they may be implemented as restrictions are being enforced. The Plan o f Action should be approved by the CEPF Secretariat before being implemented.
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E. Conflict resolution and complaint mechanism
16. The Framework should describe how conflicts involving affected persons wil l be resolved, and the processes for addressing grievances raised by affected communities, households or individual regarding the agreed restrictions, criteria for eligibility, mitigation measures and the implementation o f these elements o f the Process Framework. The procedures should take into account local dispute resolution practices and norms.
F. Implementation Arrangements
17. The Framework should describe the implementation arrangements for the project and roles and responsibilities o f different stakeholders, including the Grantee, affected communities and other relevant agencies, including those agencies involved in the implementation o f mitigation measures, delivery o f services and land tenure, as appropriate and to the extent that these are known at the time o f project preparation.
18. Monitoring and evaluation arrangements will also be described in the Framework, with more specific details for the Plan o f Action designed during implementation. The Framework should include a budget for its implementation. I t would also be appropriate to identify sources o f funding for mitigation measures identified during preparation o f the action plan
Plan of Action
19. During implementation, a Plan o f Action is developed together with affected communities to describe the agreed restrictions, management schemes, measures to assist the displaced persons and the arrangements for their implementation. The action plan may simply describe the agreed restrictions, persons affected, measures to mitigate impacts from these restrictions, and monitoring and evaluation arrangements or i t may take the form o f a broader natural resources or protected areas management plan.. .
20. The following elements may be included in the plan, as appropriate: project background and how the plan was prepared, including consultations with local communities and other stakeholders; socio-economic circumstances o f local communities; the nature and scope o f restrictions, their timing as well as administrative and legal procedures to protect affected communities’ interests if agreements are superseded or rendered ineffective; the anticipated social and economic impacts o f the restrictions; the communities or persons eligible for assistance; specific measures to assist these people, along with clear timetables o f action, and financing sources; protected area boundaries and use zones; implementation arrangements, roles and responsibilities o f various stakeholders; arrangements for monitoring and enforcement o f restrictions and natural resource management agreements; clear output and outcome indicators developed in participation with affected communities; special measures concerning women and vulnerable groups; capacity building o f the Grantee or other implementing agencies; capacity building activities for the affected communities to enhance their participation in project activities; grievance mechanism and conflict resolution ; and participatory monitoring and evaluation exercises adapted to local
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context, indicators and capacity. Monitoring wil l include the extent and significance o f adverse impacts as well as the outcome o f mitigation measures.
Disclosure
21. A draft Process Framework i s shared with (potential) affected communities to inform them about the project and get their input to project design and the Framework. Once the project, with the Process Framework, has been approved, the final Framework is again disclosed locally as well as at the CEPF website.
22. The Plan o f Action i s prepared with the participation o f affected communities. A draft should be disclosed, in a culturally appropriate and understandable manner and local language, together with the findings o f any social analysis to the persons affected by the project.
23. After the CEPF Secretariat has reviewed and approved the Plan o f Action, the Grantee discloses the final plan to affected communities and other stakeholders. The final Plan o f Action i s also disclosed at the CEPF website.
Roles and Responsibilities
24. Applicants, and subsequently Grantees, are responsible for fol lowing the requirements o f the World Bank’s Involuntary Resettlement pol icy as described in this Framework. Applicants and Grantees wil l ensure that local communities are consulted and participate during preparation and implementation o f frameworks and action plans. They will avoid adverse impacts on affected communities, or where this i s not possible develop with informed community participation measures to mitigate such impacts. Finally, they are responsible for reporting to both affected communities and the CEPF Secretariat on project progress and any unexpected and unintended events affecting local communities.
25. The CEPF Secretariat i s responsible for the implementation o f this Framework. The Secretariat’s responsibilities include: informing Applicants and other stakeholders, including local communities and organizations, o f the Process Framework and pol icy requirements; assisting Applicants, and subsequently Grantees, in the implementation o f the Process Framework and pol icy requirements; screening for projects which may affect local communities through restrictions o f access to natural resources; reviewing and approving project proposals, ensuring that they adequately apply the Wor ld Bank’s Involuntary Resettlement policy; assessing the adequacy o f the assessment o f impacts and proposed measures to address such impacts, including social risks, circumstances o f the affected communities, and the capacity o f the Applicant to implement the measures; assessing the adequacy o f the consultation process;and reviewing and approving project specific action plans prepared during project implementation.
26. Grantees are responsible for ensuring adequate budgets for implementing the planning process, including implementation o f the Plan o f Action and any compensation and/or development measures this plan may entail. They will include appropriate monitoring and
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evaluation o f proj ect implementation, including o f adverse impacts on local communities and the effectiveness o f mitigation measures. Monitoring and evaluation exercises should be designed to allow the participation o f affected communities.
27. The CEPF Secretariat i s responsible for setting aside sufficient funds for implementing this Process Framework. This includes costs for reviewing and monitoring required action plans during implementation o f approved projects. The Secretariat wil l monitor and describe the application o f this Framework and lessons learned in progress and monitoring reports.
Grievance Mechanism
28. Local communities and other stakeholders should be able to complain at a l l times to Applicants / Grantees and the CEPF Secretariat about any issues covered in this Framework and the application o f the World Bank’s pol icy o n Involuntary Resettlement. Arrangements should be described in the project specific frameworks and action plans, with contact information o f the respective organizations.
29. As a f i rst stage grievances should be made to the Applicant / Grantee. The Applicant / Grantee i s required to respond to grievances in writing (supported by other forms o f communication as needed) within fifteen working days o f receipt; claims should be filed, included in project monitoring, and a copy o f the grievance should be provided to the CEPF Secretariat. If the claimant i s not satisfied with the response, the grievance may be submitted to the CEPF Secretariat. The Secretariat i s required to respond within fifteen working days o f receipt; claims should be filed and included in project monitoring.
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Annex 11: Project Preparation and Supervision GLOBAL: Second Critical Ecosystem Partnership Fund Project
Planned Actual PCN review March 13,2006 March 13,2006 Initial PID to PIC March 20,2006 March 20,2006 Initial ISDS to PIC March 20,2006 March 20,2006 Appr ai s a1 June, 2007 June 12,2006 Negotiations June, 2007 June 29,2007 BoardRVP approval December 18,2007 Planned date o f effectiveness Planned date o f mid-term review Planned closing date
February, 2007 June, 20 10
December, 20 12
Key institutions responsible for preparation o f the project: Conservation International (CEPF Secretariat) and World Bank.
Bank staff and consultants who worked on the project included:
Name Title Unit Kathy MacKinnon Lead Biodiversity Specialist ENV Susan Shen Albert0 Ninio Charles Di Leva Tony Whitten Nurul Alam Behdad M. H. Nowroozi
Novira Kusdarti Asra
Junxue Chu Svend Jensby Katharina Gamharter Marieke van der Zon Nina Queen
Legal associate/counsel Junior Professional Associate
Procurement Assistant Grace Aguilar Program Assistant ENV
Bank funds expended to date on project preparation: 1. Bank resources: $ 75,860 2. Trust funds: $ 20,000 3. Total: $ 97,860
Estimated Approval and Supervision costs: 2. Remaining costs to approval: $30,000 3. Estimated annual supervision cost: $ 80,000
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Annex 12: Documents in the Project Fi le GLOBAL: Second Critical Ecosystem Partnership Fund Project
1. Project Concept Note 2. Project Concept Note Data Sheet 3, Project Appraisal Document (Concept Stage) 4. Project Information Document (Concept Stage) 5. Concept Review Package 6. CEPF2 concept review - init ial safeguards screening 7. CEPF2 concept review comments received 8. CEPF2 concept review - response to comments 9. Request for Comments on the Concept Stage ISDS 10. Social safeguards consultancy for CEPF 1 1. P C N Safeguards Meeting Minutes 12. Updated milestones 13, Work Program Entry GEF SEC review 14. Project Appraisal Document Data Sheet 15. Work program entry UNEP comments 16. Minutes o f Concept Review 17. Integrated Safeguards Data Sheet (Appraisal Stage) 18. Process Framework for Involuntary Restrictions 19. Indigenous Peoples Planning Framework 20. GEF Council Comments 21. GEF approval to work program 22. Quality Enhancement Review package 23. Quality Enhancement Review meeting minutes
A. Bank Staff Assessments
- P C N - March 2006 - Pre-appraisal mission: Aide-Memoire dated M a y 2007 - Decision meeting Minutes dated June 2007 - Appraisal mission: Aide-Memoire dated June 2007 - Minutes o f Negotiations dated June 2007.
B. Other
- Social safeguards reports - Ecosystem profiles for IndoBurma (Indochina region), Western Ghats and Sri Lanka (W Ghats region) and Polynesia-Micronesia - I C R for GEF Grant for first phase o f CEPF, June 2007
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Annex 13: Statement of Loans and Credits
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Difference between expected and actual
disbursements Original Amount in US$ Millions
Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. F m . Rev’d
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Not applicable.
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Annex 15: Incremental Cost Analysis
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Background
1.
2.
3.
4.
5.
The Mil lennium Ecosystem Assessment showed that over the past 50 years, human activities have changed ecosystems more rapidly and extensively than at any comparable period o f time in human history. These changes have contributed too many net gains in human well- being and economic development but have been achieved at growing environmental costs, biodiversity loss and the exacerbation o f poverty for some groups o f people. The degradation o f ecosystem services could grow significantly worse during the f i rst ha l f o f this century and i s a barrier to achieving the Mil lennium Development Goals (MDGs). Unless addressed, these problems wil l substantially diminish future options and the ecosystem goods and services available to future generations.
The Earth’s biologically richest ecosystems, the 34 “biodiversity hotspots,” are also some o f the most threatened. Together, these biodiversity hotspots harbor more than 75 percent of the most threatened mammals, birds, and amphibians yet they have already lost 86 percent o f their original habitat. These critical areas for conservation are also home to millions of people who are impoverished and highly dependent on healthy ecosystems for their survival.
Protection o f the Earth’s biological diversity is one o f the topmost priorities for global well- being. In response to the growing threats to species and habitats, the Critical Ecosystem Partnership Fund (CEPF) was launched in 2000 to provide strategic assistance to engage non-governmental organizations (NGOs), community groups, and other c iv i l society partners in conserving Earth’s biodiversity hotspots. CEPF i s a partnership between Conservation International (CI), the Global Environment Facility (GEF), the World Bank (Development Grant Facility), the Government o f Japan, and the John D. and Catherine T. MacArthur Foundation, with each organization committed to provide $25 mi l l ion to the program for a total o f US$125 mi l l ion in grant funding. Current CEPF funding from the Wor ld Bank and GEF will finish in early 2007.
The f i rst phase o f CEPF supported 15 grant programs within 14 o f the original 25 hotspots. By the end o f 2006, nine o f these grant programs closed after five years o f implementation. A 2005 independent evaluation o f the CEPF global program was highly positive and recommended that the donors seek further expansion opportunities. Although the CEPF program has been shown to be highly effective, there are st i l l significant conservation needs, both in the original 14 hotspots and in other critical ecosystems that have not yet benefited under the program. Of the 34 hotspots identified by CI, 30 include countries eligible for Bank and GEF support.
The proposed CEPF-2 project would replicate and expand successful c iv i l society implementation models for biodiversity conservation within at least 14 biodiversity hotspots. I t would build o n the lessons learned under the f i rst phase o f CEPF as well as recommendations from the independent evaluation to further strengthen the program within
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existing hotspots by expanding activities to new sub-regions and marine ecosystems. CEPF- 2 would also expand c iv i l society support and capacity building to additional hotspots. I t would complement government-led conservation efforts, by providing a streamlined, agile, mechanism for capacity building and engagement o f a wide range o f local c iv i l society actors, including local community groups, NGOs and the private sector, many o f whom are outside the reach o f traditional funding mechanisms. With i t s tight geographical focus on a small number o f the most valuable and critical ecosystems the project would maximize overall impact.
6. Recent estimates have suggested that investment o f as much as $160 mi l l ion per hotspot per year may be necessary to strengthen protection and management o f key biodiversity areas and to close shortfalls in existing protected area budgets. Funding and capacity needs vary considerably between individual countries and hotspots. As the exact ecosystems for investment are not yet known, this analysis focuses on the baseline scenario for the global project and the GEF Alternative that would enable CEPF to a) consolidate activities within some o f the current target hotspots by expanding programs into new regions and key conservation corridors, including trans-national initiatives, b) expand conservation funding to new hotspots and marine ecosystems within target hotspots for a more holistic approach to conservation and c) strengthen local c iv i l society capacity within the hotspots for more effective Conservation efforts and sustainability o f conservation outcomes.
Baseline Scenario
7. The f i rst phase o f CEPF supported grant programs in 15 regions within 14 hotspots. For smooth and effective implementation, preparation o f ecosystem profiles and grant-making programs have been staggered with activities started in three hotspots in year 1, six hotspots in year 2, 1 hotspot in year 3,2 hotspots and one additional region with another hotspot in year 4, and an additional two hotspots in year 5. Within the larger hotspots, grant programs have focused on specific geographic sub-regions, landscapes or just a few countries for more targeted and effective conservation efforts. Thus within the Sundaland Hotspot the first phase o f CEPF focused only on the island o f Sumatra, with the expectation that later initiatives would target conservation needs in other high priori ty regions within the hotspot, such as Borneo.
8. All ecosystem programs are designed to cover a five-year period o f grant making. The f i rst three grant programs approved in December 2001 (Guinean Forests o f West Africa, Madagascar, and the Tropical Andes) have already come to the end o f their active investment period and another six closed in December 2006 (Atlantic Forest (Brazil), Cape Floristic Region, the Philippines, Southern Mesoamerica; Sundaland (Sumatra), and Tumbes-Choc6-Magdalena). Other hotspots with active CEPF programs (Northern MesoAmerica, Succulent Karoo, Caucasus, Himalayas, Southwest China and Eastern Arc Mountains and Coastal Forests o f East Africa) wil l graduate to this phase o f implementation in subsequent years. CEPF has also been successful in leveraging some other additional resources for specific interventions. Thus a $1 mi l l ion donation to CEPF from the Government o f Australia has enabled some l imited start-up operations in Polynesia- Micronesia for activities targeted towards invasive alien species. CEPF management will
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9,
10.
continue to facilitate these sorts o f synergistic opportunities. Nevertheless, without additional GEF and other donor support through a CEPF-2 project, i t i s expected that the CEPF grant-making program would be completed by 2009. From the end o f 2006 CEPF operations would begin to wind down, with declining input to c iv i l society groups as well as CEPF management and monitoring, both at the global and local levels.
Biodiversity in al l hotspots wil l remain under pressure from a variety o f threats that include habitat loss and fragmentation, overexploitation, invasive alien species, pollution (especially aquatic systems) and expanding infrastructure and development - see Annex 1. Under the Baseline Scenario, i t i s expected that national governments, donors and NGOs, including CI, would maintain commitments to protected areas and biodiversity conservation, including support through GEF programs implemented under the new Resource Allocation Framework (RAF). Under this scenario, i t i s expected that there would be substantial biodiversity investments, including GEF investments, in a few high biodiversity countries but less access to external conservation funding for many other countries, including many o f the smaller and least developed countries with greatest capacity needs. Overall, there could be a leveling-off or reduction in biodiversity spending with much o f the funding focused on government-led initiatives and a few key protected areas. Some countries that would be eligible for CEPF funds may also benefit under the UNDP Small Grants Program but that program does not focus exclusively on biodiversity. Overall there are expected to be fewer opportunities and financing for local c iv i l society groups to participate in, and influence, biodiversity conservation, especially where such groups fal l outside the reach o f traditional financing mechanisms.
Incremental costs analyses were prepared for each o f the 15 critical ecosystems targeted in the 14 hotspots during the first phase. The total baseline investment across these 15 regions was $4.2 bi l l ion (including a $3 bi l l ion government project in China alone), but an extremely small percentage o f this i s for civil society. The incremental CEPF cost was $100 million. W h i l e i t i s clear that there will be limited resources for national and local c iv i l society engagement in conservation in the future, i t i s almost impossible to determine a baseline cost for biodiversity investments for the CEPF-2 project at this time, especially since only 3 o f the target hotspots have been selected. For each critical ecosystem targeted for CEPF-2 investment, incremental costs analyses will also be conducted as an integral part o f the ecosystem profi l ing process.
GEF Alternative
11. The CEPF-2 project would support c iv i l society conservation efforts in at least 14 o f the 30 revised hotspots (see Annex 1). These 30 hotpots include more than 90 countries eligible for GEF and Bank assistance, ranging from species-rich megadiversity countries to small island states (SIDs) and centers o f endemism. Under CEPF-2, choice o f new hotspot, and region, investments wil l be based on biodiversity status, conservation needs, social and political enabling environments and complementarity and added value to other donor efforts. Thus CEPF-2 has the potential to complement conservation efforts in those countries with high biodiversity but modest conservation funds, to fill in gaps, and particularly to focus resources to c iv i l society and private sector conservation efforts that may not otherwise be
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12.
supported. The CEPF ecosystem approach also provides the opportunity for international collaboration in support o f multi-country transboundary conservation efforts, often neglected in national plans.
The CEPF-2 project would expand c iv i l society activities to new hotspots, new regions within existing hotspots and new habitats, including marine ecosystems, within hotpots where conservation interventions targeting both land and aquatic systems would increase overall effectiveness. Ecosystem profiles have already been prepared for 3 new regions (the Polynesia-Micronesia Hotspot; the Indochina region o f the Indo-Burma Hotspot; and the Western Ghats region o f the Western Ghats and Sri Lanka Hotspot). Implementation o f these ecosystem profiles i s dependent upon approval o f a second phase o f the CEPF; once funding is available grant programs would be initiated in these hotspots. Expansion into new critical ecosystems such as the Polynesia-Micronesia Hotspot wil l expand the opportunities to small island developing states.
3. As part o f the assessment process in “completed” ecosystem programs, the CEPF Secretariat and Working Group will develop explicit criteria for exit andor re-entry strategies into hotspots which have already received five years o f CEPF investments. Future investments would be based o n conservation needs, likelihood o f success and complementarity, with specific targeting to c iv i l society initiatives in high biodiversity sub-regions and ecosystems (e.g. marine) that have not yet benefited from CEPF investments. Investments would build on and supplement activities undertaken in the f i rst phase o f CEPF with explicit activities to replicate best practice and cross-learning within, and across, hotspots.
14. The GEF Alternative provides an opportunity to build on existing governmental and donor efforts in critical ecosystems by identifying a strategic and complementary role for c iv i l society involvement through targeted conservation investments. Each CEPF investment strategy developed together with stakeholders and approved by the CEPF Donor Council wil l also be endorsed by the relevant GEF focal point to ensure consistency with country biodiversity priorities, as outlined in national Biodiversity Act ion Plans and country programmatic frameworks. By focusing at the ecosystem rather than country level, the project wil l be able to support a landscape approach to conservation including support for international trans-boundary initiatives. GEF funding would also enable the program to broaden partnerships and further strengthen devolution o f roles and responsibilities to national and local levels, to increase transparency, strengthen capacity and build greater ownership and sustainability o f conservation efforts.
1 5. The CEPF-2 program would contribute to strengthened involvement o f c iv i l society in strengthened protection, management and support for key biodiversity sites and thereby contribute to achievement o f the 2010 targets o f the Convention on Biological Diversity. Specific activities would be selected on a competitive basis at both the global and ecosystem-profile level but are expected to include the following components and expected global benefits.
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Component 1: Strengthening protection and sustainable management of globally significant biodiversity
16. CEPF-2 would support c iv i l society projects that focus on key biodiversity areas and address threats to biodiversity across broad landscapes that include a matrix o f land uses, including protected areas, biological corridors and high value conservation sites in production landscapes. CEPF-2 wil l contribute to the strengthened protection, and management o f more than 20 mi l l ion hectares o f key biodiversity areas, including at least 8 mil l ion hectares o f new conservation areas, including legally designated protected areas, indigenous reserves, and community and private lands managed for conservation. The GEF Alternative wil l also support more effective community stewardship programs with local communities and indigenous groups, including land-use planning for conservation and sustainable use. Special focus will be placed on ensuring the long-term sustainability o f these initiatives through capacity building, technical assistance, awareness raising and innovative management and financial mechanisms.
The incremental cost of this component compared to CEPF baseline expenditures and investments in strengthening protection and sustainable management of globally significant biodiversity i s $52.1 million, of which GEF would contribute $13.22 million.
Component 2: Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning.
CEPF-2 wil l build upon lessons learned to further build local and national capacity to act in favor o f biodiversity conservation, particularly to influence local and national governments and other sectors in integrating biodiversity conservation into development and landscape planning. CEPF will consolidate support to some current c iv i l society partners and expand support to hundreds o f others within critical ecosystems to increase local and national capacity to integrate biodiversity conservation into development and landscape planning.
The GEF Alternative wil l support consolidation o f biological corridors and mainstream conservation into production landscapes through support for more effective land-use planning, collaboration with the private sector and landscape-scale management efforts, including trans-boundary coordination. Activities will support integration o f biodiversity conservation into production systems and sectors, including enabling c iv i l society groups to plan, implement, and influence biodiversity outcomes as effective partners in sustainable development. Such participation wil l build on local knowledge and technical expertise, and leverage social capital to bring innovative ideas to solving local problems. The focal approach would be to strengthen protection o f critical biological corridors that link key biodiversity areas within a multiple use landscape. The project would support promotion of supportive pol icy and legislative frameworks; more sustainable resource management linked to livelihoods; and measures to control and manage invasive alien species in regions where these are a particular threat. Support for capacity building, partnerships and advocacy and outreach wil l strengthen local ownership and significantly increase the scale o f potential impact and sustainability.
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The incremental cost o f this component compared to CEPF baseline expenditures and investments in increasing local and national capacity to integrate biodiversity conservation into development and landscape planning is $23.9 million, o f which GEF would contribute $6.78 mil l ion.
Component 3: Effective monitoring and knowledge sharing, including systematic analysis and documentation of CEPF results and experiences.
19. The GEF Alternative includes building upon the current CEPF participatory monitoring and hotspot-level implementation programs to support improved learning, replication and scaling up o f promising models and approaches from components 1 and 2. GEF support wil l enable a strengthened monitoring system, particularly at the hotspot level as wel l as more effective analysis and documentation and dissemination o f experiences, best practices and lessons learned to enhance the project’s potential to act as a conservation mechanism for the conservation community as a whole. These activities are expected to lead to further generation, adoption, and application o f best practices to conserve critical ecosystems and strengthen c iv i l society’s essential role within them.
The incremental cost of this component compared to CEPF baseline expenditures and investments in monitoring and learning i s $4.5 million, with no GEF contribution.
Component 4: Ecosystem profile development and project execution.
20. This component would support development o f the ecosystem profiles by c iv i l society groups as strategic business planning and implementation documents for the partnership and wider conservation community; the grant-making responsibilities o f the Regional Implementation Teams at the hotspot level; and also overall execution and administration of the global program by CI. Activities would include developing the ecosystem profiles as shared strategies together with stakeholders in each hotspot. This component also includes a subcomponent covering CI’s administration and execution o f the global program, including hosting the CEPF Secretariat, employing CEPF Secretariat staff, and ensuring that al l funds are managed with due diligence and efficiency.
The incremental cost o f this component compared to CEPF baseline expenditures and investments in monitoring and learning i s $19.5 million, with no GEF contribution.
21. Cost. The total costs o f the GEF Alternative is estimated over a five year period at the level o f at least $100 mi l l ion with a CEPF-2 program targeting c iv i l society interventions to supplement national government and other donor efforts. GEF is requested to contribute $20 mi l l ion that wil l leverage funds from other donors. I t is expected that support from GEF during the second phase o f CEPF would leverage additional funding from among the original partners as wel l as from other MDBs, bilateral agencies, and foundations. Conservation International has committed to providing another $25 mi l l ion for a second phase o f CEPF as co-funding for the GEF grant. AFD will also contribute $25 mi l l ion to enable a seamless transition to the second phase. The MacArthur Foundation i s expected to contribute $15 million. Other donor partners are expected to review continued support as
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22.
Incremental
their current contributions end. The World Bank i s considering options for support to a second phase, after completion o f the current round o f DGF funding. The GEF funds wil l be deposited to the CEPF account, but a separate ledger account will be maintained to track the receiving and uses o f the funds.
I 52.1
Expected global benefits wil l arise in at least 14 biodiversity hotspots from the increased national and local c iv i l society capacity to manage and deliver small conservation initiatives in an efficient and effective manner under agreed strategic frameworks to better integrate biodiversity conservation into development and landscape planning. These interventions are expected to lead to a strong c iv i l society constituency for biodiversity conservation within the hotspots as well as generation, adoption, adaptation, and application o f lessons for improved biodiversity conservation outcomes, relevant both to CEPF and the broader Bank and GEF biodiversity portfolios as wel l as to other small- and medium-size grant programs and donor community-driven development initiatives.
The Baseline Scenario, GEF Alternative and incremental costs, as wel l as corresponding local, national and global benefits are displayed in summary form in the fol lowing table.
Component
1. Strengthening protection and management of globally significant biodiversity
2. Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning
cost Category Baseline
GEF Alternative
Tota l
USD Mil l ion Baseline to
b e determined
at hotspot level x 14
hotspots Baseline +
52.1
Domestic Benefit
National programs supported at current levels.
Addit ional c i v i l society activities to provide greater protection and management o f important biodiversity area, including protected areas and production landscapes. Enhanced empowerment and capacity o f local and national c i v i l society.
Some l imi ted participation o f c i v i l society in conservation and mainstreaming o f biodiversity, within scope o f existing resources.
Global Benefit
Funds targeted to a few globally important biodiversity sites, especially protected areas, dependent o n funding availability.
Strengthened protection and management o f globally significant habitats in eligible countries in 14 hotspots, including protected areas, key biodiversity corridors and production landscapes. Greater sustainability o f conservation outcomes due to more effective c i v i l society involvement and ownership in conservation initiatives.
L imi ted local and national c i v i l society mobil izat ion for conservation and sustainable resource use.
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3. Effective monitoring and knowledge sharing
4. Ecosystem profile development and project execution
GEF Alternative
Tota l Incremental Baseline
GEF Alternative
Tota l Incremental
Baseline
Baseline + 23.9
23.9 Baseline to
be determined
at hotspot level x 14
hotspots Baseline +
4.5
4.5
Baseline to be determined at hotspot level x 14 hotspots
Strengthened national and local capacity to design, implement and monitor conservation activities and to influence development and planning decisions.
L imi ted monitoring andexchangeof experiences.
Enhanced information and capacity at national level, including engagement o f c i v i l society.
M o r e effective c i v i l society conservation within globally important areas in 14 hotspots, especially among s m a l l NGOs, local communities, indigenous groups and private sector. Effective alliances for advocacy, influence and ownership contribute to sustainability o f conservation impacts.
L im i ted awareness and implementation o f lessons learned and good practices
Strengthening monitoring and evaluation, leading to more targeted and adaptive management to best meet conservation needs within high biodiversity areas. Systematic analysis and documentation and dissemination o f CEPF results and experiences for effective replication and enhanced conservation within and across hotspots.
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Totals
Total
Alternative
I
Baseline + GEP
Incremental Baseline
GEF Alternative
Incremental
Ecosystem profiles
19.5 Baseline to be determined at hotspot level x 14 hotspots Baseline +
20.0
100.0 (+80.0)
FUTS grant- making
CEPF Secretariat
2.6
4.6
12.3
Development o f management tools, assessments and business plans for strategic, cost effective and targeted interventions to support conservation and biodiversity management in global hotspots
Effective and well coordinated global program, to bring strategic and complementary conservation resources to globally important biodiversity sites in 14 global hotspots.
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Annex 16: STAP Roster Review
GLOBAL: Second Critical Ecosystem Partnership Fund Project
A. Key Issues: 1. Assessment of scientific and technical soundness of the project.
1. General assessment. During its first phase (2000-2005), the Critical Ecosystem Partnership Fund (CEPF) has proven to be a highly important mechanism for fbnding o f strategic biodiversity programs and projects in biodiversity hotspots, providing assistance to NGOs, community groups and c iv i l society partners that otherwise have limited access to resources. The approach has recently (late 2005) been subject to a thorough independent evaluation that concluded that CEPF was highly successful, and that support should be continued. The present proposal i s aimed at just that: continuation o f CEPF in a second phase.
2. The focus on biodiversity hotspots. i s a well-founded approach. Such sites harbor the world’s greatest concentrations o f globally significant biodiversity, while at the same time they are often also regions where poverty reigns. Investments in biodiversity will help curb environmental degradation that may otherwise worsen poverty levels, while poverty alleviation programs may also support environmental sustainability. During phase 1 , the CEPF targeted 15 regions in 14 o f the original 25 biodiversity hotspots. The latter have recently been expanded to 34, o f which 30 are eligible for GEF and Wor ld Bank support. During the second phase, CEPF wil l focus on investments in critical ecosystems in at least 14 biodiversity hotspots in World Bank countries that have ratified the CBD. What i s not clear is which proportion o f these 14 in CEPF-2 will be new, i.e. not having received funding under CEPF-l? The proposal states that choice (of hotspot regions) wil l be based on biodiversity status and threats, assessment o f CEPF progress in current hotspots targeted, and current or planned investments by other donors. The proposal should provide an indication o f where the priorities are l ikely to be, and the 16 ‘new’ hotspots not funded under CEPF-1 should be prioritized according to biodiversity and degree o f threat. Incidentally, the CEPF website states that the fund has up to now operated in 16 biodiversity hotspots and not 14 as stated in the proposal.
3. Co-financingl During CEPF phase 1 , GEF co-financing was provided by Wor ld Bank, MacArthur Foundation, Conservation International and the Government o f Japan, in equal shares o f US$25 mi l l ion each. CEPF-2 co-financing wil l be provided again by Conservation International and MacArthur Foundation, now together with the Government o f France (via the bilateral agency AFD), with each again contributing U S $ 2 5 million. Why i s there no World Bank co-financing for CEPF-2? This is unusual, given that the World Bank President (or his designee) chairs the CEPF Council, and should be explained. The Table on p. 14 (ExSum) states that the status o f MacArthur Foundation co-financing i s “To be considered at March Board meeting.” This appears uncertain - what wil l happen if the Board decides against co-financing, or decides to delay it until 2008?
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4. Position of Conservation International. One point o f criticism (e.g. in the 2005 independent evaluation) on CEPF-1 has been the position o f CI, and potential conflict o f interest. CEPF i s managed from within CI, whose Board o f Directors has fiduciary responsibility for the program. Also, in nine o f the 15 regions in which CEPF-1 operated, the local Coordination Unit (renamed Regional Implementation Team in CEPF-2) was provided by CI. According to the 2005 independent evaluation, there init ial ly was considerable pressure on CEPF staff to support funding for relatively large C I proposals. In response to criticism, a more balanced approach was taken, and the share o f CEPF grants to C I f e l l f rom 50% to a cumulative 35% by mid-2005. The evaluation team recommended that a global limit be set for C I grants that is lower than the current limit o f 50%. However, this has not been addressed in the proposal for CEPF-2, and should be taken up. The proponents should also bear in mind that proposed funding for the RITs also amount to $10 mi l l ion or 10% o f CEPF-2 funding (see g), below), which i s in addition to the grants provided.
5. Peer review of proposals. Related to point d), the 2005 evaluation team recommended that al l grant proposals submitted by C I should be submitted to peer review, including Coordination Units (RIT) grants. The proposal for CEPF-2 states (para. 48 o f the Executive Summary): “The Regional Implementation Team or advisory committee in each hotspot wil l review the proposal and, where appropriate, formally write a justification for approval. As recommended by the independent evaluation, this step would ensure more systematic and independent peer reviews o f al l proposals f rom C I and other international organizations and more systematic use o f advisory committees to advise on international proposals.” C I proposals reviewed by the RIT can hardly be regarded as an independent peer review, as the RITs are recruited by, and answerable to CI.
6. Incremental Cost Analysis. CEPF grants are to (co-)finance as yet undetermined biodiversity projects in at least 14 o f the 30 targeted biodiversity hotspots. Under such circumstances, conducting an I C A for CEPF-2 i s a theoretical exercise, as baselines remain unknown until the second phase o f the fund becomes operational and proposals are submitted and selected. This places an extra responsibility o n the CEPF Council, who are to ensure that these funds do not replace other funding sources, and only cover incremental costs associated with conservation o f globally significant biodiversity. Paragraph 10 in the I C A (Annex A o f Executive Summary) states “Total incremental costs o f this proposed proj ect-the difference between the baseline scenario and the GEF alternative-are calculated to be $100 million, o f which $25 mi l l ion i s being requested from the GEF”. This “calculation” i s unlikely, as the baseline could not have been calculated - i t is largely unknown.
7. Management costs. The independent evaluation mentions (p.2 o f executive summary) that CEPF “portfolios typically consist o f a few relatively large grants for program coordination and leadership, several medium-sized grants to relatively capable national and international NGOs for strategic, high-priority projects, and a larger number o f smaller grants (many under $20,000) to emerging c iv i l society organizations carrying out an impressive range o f grassroots activities, some o f which are thematically clustered.” This observation by the 2005 evaluation team suggests that a significant percentage o f CEPF
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funds are going to C I and the RITs (formerly the CUs) for coordination purposes. The current breakdown o f the budget (ExSum p.9, PAD Annex 5, p.32) does not specify management and overhead costs, but states that RIT costs are included in 2A, 3 A and 3 B to a total o f almost $10 million, or about 10% o f the total costs. Whi le $10 mi l l ion i s a large sum, 10% does not seem an extraordinary proportion for management.
8. Minor points: . ExSum, p. 4, point 7/PAD p.2: Resource Allocation Framework. Should mention that the RAF i s a program o f the GEF. . ExSum.p. 4, point 1 O/PAD p. 5 point3/PAD Annex 3 Results Framework & Monitoring; CEPF-2 wil l focus on at least 14 biodiversity hotspots. H o w many o f these wil l be new hotspots? CEPF-1 focused on 14 o f the 30, and in theory CEPF- 2 could continue in the same 14 and s t i l l meet the requirement. Need to specify how many o f these 14 wil l be in addition to the original 14 under CEPF-1. . ExSum p4. point 1 l /PAD ; ‘In each hotspot, disbursement o f grants will be guided by ecosystem profiles based o n a stakeholder-driven prioritization process to identify conservation targets, major threats, socioeconomic factors, current threats and conservation investments.’ Given that 35% o f the cumulative CEPF-1 funds have up to now been granted to C I proposals, one may question the stakeholder- drivenness. . ExSum p.8, point 18; “CEPF resources are targeted within critical ecosystems . . .in World Bank client countries that have ratified the CBD.” Do the MacArthur Foundation and the French AFD have focal countries as well? If so, shouldn’t this be given consideration as well? . ExSum p. 11, point 24/PAD p. 3; US$ 1 mi l l ion pledged from Australian government - this may be small compared to other inputs, but should be included in l i s t o f co-financing sources.
ExSum, p. 12, point 30; “Monitoring o f conservation targets i s currently being implemented in about ha l f o f the current CEPF investment regions, but this wil l be expanded to al l investment regions in the future.” A date should be set by which these are to be included. . Need to provide full text o f some abbreviations: e.g. CAS and PRSPs (p. 14 o f ExSum), MDBs (ExSum p. 27); this may not been needed for some widely used abbreviations (such as TOR, NGO and CBD). . ExSum p. 15, point 45: i t i s mentioned here that the Coordination Units o f CEPF-1 are the same as the Regional Implementation Teams, already mentioned o n p.6. This should be mentioned on p.6 as well, to avoid confusion.
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. ExSum p. 32, point 5: GEF Biodiversity Tracking Tool. It i s proposed here that the GEF SP1 tracking tool be used for monitoring Component 1. Why not use the SP2 tracking tool for Component 2? This would seem both logical and useful. . ExSum p. 33/PAD p. 24 Arrangements for results monitoring. Under outcome 1 , the f i rst outcome indicator reads”At least 12 critical ecosystems receive support for strengthening protected areas systems to ensure long-term sustainability.” Shouldn’t this figure be 14, i.e. the same as the number o f critical ecosystems receiving support f rom CEPF?
Evaluation of the identification of global environmental benefits and/or drawbacks and risks of the project
9. As under CEPF-1, the second phase o f CEPF is envisaged to have significant global environmental benefits for the targeted biodiversity hotspots. There are no apparent environmental drawbacks or added global environmental risks because o f the CEPF, although the CEPF Council i s to remain vigilant to ensure that CEPF h n d s do not end up simply replacing or displacing other funds.
Evaluation of the project’s compliance or fulfillment of the goals of GEF
10. The CEPF targets various Operational Programs o f the Biodiversity Focal Area, including OP1 Arid & Semi-arid Zone Ecosystems, OP2: Coastal & Freshwater ecosystems; OP3: Forest Ecosystems and OP4: Mountain Ecosystems. The Project wil l contribute to the GEF Business Plan and three o f the four Biodiversity Strategic Priorities: Catalyzing Sustainability o f protected Areas (SP-1); Mainstreaming Biodiversity in Production Landscapes and Sectors (SP-2) and Generation and Dissemination o f Best Practices for Addressing Current and Emerging Biodiversity Issues (SP-4).
Assessment of how the project fits within its regional context
1 1. CEPF focuses on biodiversity hotspots and takes an overwhelmingly regional approach in i t s strategies. In each hotspot, CEPF uses an Ecosystem Profile methodology to analyze threats and opportunities, identify the ecological baseline for measuring progress, and provide clear strategic directions to guide grant making. These Ecosystem Profiles are developed together with a wide range o f stakeholders, which ensures that regional priorities are flagged, and ultimately addressed. In each hotspot wherein it operates, CEPF i s organized via so-called Regional Implementation Teams (formerly known as Coordination Units), and as the name implies, these take a broader view than one that i s site or location based.
Evaluation of the replicability o f the project
12. Component three Effective monitoring, knowledge sharing and outreach o f CEPF focus on monitoring, learning, replication and scaling up o f promising models from Components 1 and 2. Replication i s therefore firmly embedded in the project, as in addition to promotion
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o f ideas, CEPF can provide grants for implementation o f proposals for replication. CEPF contributes to the GEFs Strategic Priority SP-4 Generation and Dissemination of Best Practices for Addressing Current and Emerging Biodiversity Issues through an explicit replication strategy to promote cross-learning and uptake o f best practice at both the hotspot and overall program level.
Evaluation of the sustainability of the project
13. CEPF aims at achieving sustainability at various levels, including ecological, social and financial sustainability: . Ecological sustainability. The fundamental premise o f CEPF is that large-scale
actions to protect biodiversity are more likely to succeed if they are both influenced and supported by c iv i l society. Through its capacity building program i t therefore aims at building an effective and aligned c iv i l society sector to mainstream biodiversity, building strategic and effective alliances to increase impact and sustainability. CEPF contributes to the sustainability o f PA networks and landscapes by also supporting landscape-level conservation outcomes and cross- border initiatives. . Social sustainability. Through i t s grants and the work o f i t s staff and locally based Regional Implementation Teams, CEPF-2 wil l empower a wide variety o f c iv i l society actors to directly assist in biodiversity conservation, acquire a positive stake in sustainable development programs, and become sources o f improved design, support and durability for those efforts.
Financial sustainability. Sub-component 1 d focuses specifically on developing and identifying Innovativefinancial mechanisms for sustainability. Under consideration are the introduction and use o f conservation financing tools such as payments for environmental services and economic incentives for conservation. CEPF-2 wil l further strength joint efforts with governmental partners, the private sector and other funding mechanisms.
B. Secondary issues: 2. Evaluation of linkages to other focal areas (international waters, climate change, etc ...)
14. The following linkages to the other GEF focal areas exist: . Prevention or reduction o f further loss o f forested ecosystems in the biodiversity hotspot areas - one o f the main aims o f CEPF - will directly contribute to the Climate Change focal area.
There i s a strong link with the Land Degradation focal area, not only though prevention o f loss o f forests (as mentioned above), but because CEPF also aims to achieve greater sustainability o f production landscapes and prevent further decline in biodiversity in such areas. The program aims to achieve this through strengthened c iv i l
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society capacity, and by working with the private sector and other c iv i l society actors to influence regional and national development programs and policies. . CEPF-1 primarily targeted terrestrial ecosystems, but CEPF-2 will also invest in marine ecosystems within and adjoining hotspots, and as such may contribute to the International Waters focal area, where these are o f a transboundary nature. . There i s a weak link with the Persistent Organic Pesticides (POPS) focal area, as CEPF aims to increase agricultural sustainability - agriculture is seen as one o f the main threats in many o f the hotspot regions. Although not specifically stated, one o f the strategies may be reduction o f pesticides use. Overall, the impact o f the project in this focal area i s expected to be modest.
Evaluation of linkages to other programs and action plans at the regional and sub- regional level
15. As recommended by the independent evaluation, CEPF-2 will strengthen operational collaboration with the donor partners (GEF and Wor ld Bank are both represented on the CEPF Donor Council and Working Group) as an explicit pr iori ty during implementation. Activities are to include engaging regional and national representatives o f the partners and implementing agencies at a much greater level in the participatory planning process for each ecosystem, and developing mechanisms for regular sharing o f information and exploration o f collaboration opportunities. Cooperation with the regional operations o f the World Bank wil l focus on strategic opportunities identified during a series o f regional meetings in 2005, to improve collaboration between CEPF and the World Bank at the country and hotspot level.
16. As during CEPF-1, a wide variety o f grantees will become recipients o f CEPF-2 fhds; these grantee agencies wil l create operational linkages within their own programs and with CEPF donor partner institutions and implementing agencies nationally and across the hotspot, as well as with governments and other sectors in the hotspots. The RITs wil l serve to build linkages with relevant programs, strategies and actions plans across the hotspot.
Assessment of other beneficial or damaging environmental effects
17. The CEPF i s envisaged to have very significant environmental benefits across a wide range o f ecosystems and regions, both for biodiversity and the environment in general (e.g. by promoting sustainable land use). Additionally, CEPF aims at replication, among others by building capacities in c iv i l society and with NGOs, so the positive effects are l ikely to be felt over an even wider area in the recipient countries.
18. Damaging environmental effects due to the implementation o f the CEPF are not anticipated, Most projects carried out under CEPF focus on capacity building and empowering stakeholders, and the few projects that might potentially have (some) negative impacts wil l be subject to World Bank (and national) regulations for environmental
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assessment and management. These are to be summarized in Annex 10 o f the PAD, on Safeguard Policy Issues (not present in documents submitted to STAP reviewer).
Evaluation of the degree o f involvement o f stakeholders in the project
19. The PAD does not include a stakeholder involvement plan, but it i s clear f rom the project documents that key stakeholder involvement on the CEPF is by means o f their intensive participation in the design o f the Ecosystem Profile and the investment strategy. The strategy development process i s led by C I or other c iv i l society groups, who promote wide participation and transparency among stakeholders to reach consensus on the highest priorities for conservation and the CEPF investment strategy. The process enables key communities, including indigenous and ethnic groups within the focal areas, to take part in determining priority actions. C iv i l society groups, including NGOs, community groups, the private sector and other c iv i l society institutions, wil l also be the direct beneficiaries o f al l CEPF grants. CEPF will build on pi lot models where local groups directly manage small grants programs to address specific strategic directions within an ecosystem profiles. At the ecosystem level, c iv i l society groups and other partners will be directly involved in monitoring and assessing progress, and refining the investment approach during implementation in individual hotspots
Assessment of the capacity building aspects
20. CEPF i s largely a capacity building program, as the three components al l have a major (component 1) or explicit capacity building focus (components 2 & 3). Component 1 on Strengthening protection and management of globally signipcant biodiversity supports c iv i l society efforts to catalyze improved management and expansion o f existing PAS (1 a), support c iv i l society activities to strengthen protection o f critical biological corridors (lb), assist communities and other partners in management and stewardship o f biologically-rich lands (1 c), and achieving financial sustainability for biodiversity conservation (1 d). All of these sub-components wil l have a major capacity building focus. Component 2 Increasing local and national capacity to integrate biodiversity conservation into development and landscape planning and Component 3 Effective monitoring, knowledge sharing and outreach focus entirely on capacity building, training, creating awareness, education and outreach.
Innovativeness o f the project
2 1. The CEPF i s a highly innovative program within the GEF, being the only major grant- lending program within the GEF that specifically targets biodiversity hotspots, and provides small-sized grants in support o f biodiversity conservation to a wide range o f actors within each hotspot, aimed at a common, hotspot-wide strategy developed by a wide range o f stakeholders.
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CONCLUDING REMARKS
22. CEPF-2, l ike i t s predecessor CEPF-1, provides an excellent and timely opportunity for effective conservation o f highly threatened, globally significant biodiversity in the world’s major hotspots. The grant-lending approach based o n regionally developed strategies and coordinated via decentralized Regional Implementation Teams, i s innovative and has proven to be high effective during phase one. There are no obvious reasons for changing the general modus operandi, as the model appears to be sound and successful. N o major r isks or problems are envisaged, and the issues outlined above (see la - l g ) can easily be addressed.
Wim Giesen
Ulft, 8th March 2006
Task Team Response to the STAP Reviewer
23. The Task Team found the STAP review very helpful and highly supportive o f the CEPF-2 project. The team has prepared the following clarifications and responses to the STAP review and ensured that the project document includes these points.
Selection of Hotspots to be funded under CEPF-2
24. The f i rst phase o f CEPF funded 15 regions in 14 o f the original 25 hotspots identified by Conservation International. In 2005 based on new research, C I revised hotspot boundaries and increased the number o f hotspots to 34; the website reflects these revisions i.e. investments were made within 16 o f the new 34 hotspots. For example, the original Eastern Arc Mountains and Coastal Forests o f Tanzania and Kenya Hotspot have now become two hotspots: the Coastal Forests o f Eastern Afr ica and Eastern Afromontane hotspots.
25. At least four o f the 14 critical ecosystems to be targeted during a second phase wil l be new (see text in the introduction to the section on components). Investment strategies have already been developed for PolynesiaMicronesia, Indochina, Sri Lanka, and Western Ghats and would be implemented under phase 2 o f the CEPF program. Implementation wil l begin as soon as funding i s available; the AFD funding i s expected to provide a seamless transition into second phase hotspots. Other critical ecosystems for investment wil l be chosen based o n criteria such as biodiversity status, conservation needs, social and political enabling environment and availability o f other conservation funding. Hotspots and focal regions within hotspots would be chosen to complement government and other donor fbnding, including GEF investments under the new Resource Allocation Framework
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Cofinancing
26. A letter o f commitment for second phase cofinancing has already been received from CI. Letters are expected from AFD and the MacArthur Foundation prior to CEO Endorsement. The Wor ld Bank i s considering options for renewed Bank support after the current DGF grant closes in FY07. The CEPF Secretariat wil l continue to seek additional co-funding and opportunities to leverage parallel fbnding to support the next phase o f the CEPF program. Investments in hotspots wil l be staggered in l ine with fbnding availability and sequencing and implementation capacity.
27. The $ l m grant from the Government o f Australia (Natural Heritage Program) has already been provided to CEPF for specific activities and would not be co-financing for CEPF-2. However, in providing this finding, the Australian government does hope to catalyze fbll implementation o f the ecosystem profile for the Polynesia-Micronesia Hotspot under the second phase o f the CEPF program.
28. Under the second phase o f the CEPF program, the Donor Council may also decide to establish new hnding windows outside the WB/GEF CEPF-2 Project to accommodate the strategic interests o f specific donors.
Funds available to C I and potential conflict of interest
29. The first phase o f CEPF had a 50% cap on global grants available to C I although the evaluation found that approximately 35% went to C I and 59% to international organizations overall. During the preparation o f CEPF-2, the team took note o f the views and recommendations o f the independent evaluation team in regard to need for greater transparency to avoid perceptions o f conflict o f interest. The team considered a cap o n the amount o f global grant finding available to C I and/or other international organizations but this option was rejected as there i s weak local capacity for conservation in some hotspots and international NGOs, including CI, may s t i l l need to take a lead role. Instead, the project design incorporates specific steps to ensure further transparency, devolution and effective decision-making as well as additional steps to avoid potential conflict o f interest. For example, the Regional Implementation Teams, whether international NGOs or other locally-based organizations, wil l play a much greater role in decisions with regard to grant making within their specific ecosystem but neither the RITs, nor other offices and programs o f those organizations, would be eligible for additional grants within that particular hotspot.
30. See section 5, Alternatives considered and reasons for rejection, and section C o n Implementation.
Peer review of proposals
3 1. All proposals by international organizations, including CI, wil l be subject to peer review. Additional steps have also been included to ensure effective decision-making as well as to avoid potential conflict o f interest. See section C on Implementation.
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32. All grants wil l be awarded on a competitive basis. Specific steps related to grants to international organizations wil l also include:
rn The existing programs and potential role o f international organizations in each hotspot wil l be documented as part o f the ecosystem profi l ing process. . All international groups, including CI, will be required to demonstrate a comparative advantage in their grant application. Proposals designed and implemented with a local partner or incorporating strong capacity building would be given preference.
rn The Regional Implementation Team or advisory committee in each hotspot wil l review the proposal and, where appropriate, formally write a justification for sole source approval.
Incremental cost analysis
33. The STAP reviewer queries the “calculation” o f $1 OOm as incremental cost as unlikely, as the baseline could not have been calculated - it i s largely unknown. The Task Team agrees that i t i s extremely difficult to calculate baseline finding and incremental costs on such a global project, especially when target hotspots are s t i l l to be finalized. Nevertheless, incremental costs analyses were prepared for each o f the 15 critical ecosystems targeted in the 14 hotspots during the f i rst phase and these costs are detailed in the Incremental Cost section. In addition, incremental cost analyses wil l be prepared for each critical ecosystem as an integral part o f the ecosystem profi l ing process during the CEPF-2 project ... Global estimates suggest that finding levels much higher than currently available are needed to strengthen biodiversity conservation and management. I t seems fair to suggest that al l of the $100 mi l l ion to be mobilized by this project to support c iv i l society conservation activities would be incremental. The GEF i s requested to provide $20 million, which wil l leverage at least another $80m o f other donor co-funding.
Management costs
34. Management and overhead costs are now directly reflected in Component 4c, Secretariat o f the Project Costs detailed in Annex 5.
Stakeholder drivenness
35. The CEPF-2 project design includes specific activities to enable locally-based c iv i l society groups, including national and local groups, to play a greater role in decision making during project design and implementation. Efforts will be strengthened to encourage even greater participation o f a l l relevant stakeholders, including local communities and indigenous groups, to participate in the development o f the ecosystem profiles and strategies. All grants would be awarded on a competitive basis, with more decision-making devolved to Regional Implementation Teams and local advisory committees. Regional
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Implementation Teams would be selected on a competitive basis and could not compete for additional grants within their hotspots - see Implementation Arrangements.
Monitoring
36. Specific conservation targets and related indicators will be developed as an integral part o f the ecosystem profi l ing process for each ecosystem. Progress at the ecosystem/ hotspot wil l be monitored by the Regional Implementation Teams and measured against these expected outcomes and results frameworks. Individual projects that focus on protected areas and/or mainstreaming biodiversity in production landscapes will apply the GEF SP1 and SP2 tracking tools.
GLOBAL: Second Critical Ecosystem Partnership Fund Project
Background
1. The Critical Ecosystem Partnership Fund (CEPF) i s a jo int initiative o f Conservation International (CI), the Global Environment Facility (GEF), the Government o f Japan, the John D. and Catherine T. MacArthur Foundation and the Wor ld Bank. Each o f these donor partners committed to a $25 mi l l ion investment over 5 years: CI, GEF and the Wor ld Bank from 2000, the MacArthur Foundation from 2001 and the Government o f Japan from 2002.
2. CEPF was conceived as a model to demonstrate the effectiveness o f mobilizing innovative alliances among NGOs to achieve conservation objectives. The objective o f CEPF i s to provide strategic assistance to nongovernmental organizations (NGOs), community groups and other c iv i l society partners to help safeguard Earth’s biodiversity hotspots, i.e., the biologically richest yet most threatened ecosystems. CEPF had progressively established active grant making programs in 15 regions covering 34 countries within 16 hotspots by June 30,2005. CEPF had committed grants o f $68 mi l l ion by this date, o f which $47 mi l l ion had been disbursed from an overall grant making budget o f $100 million.
3. CEPF is managed as a semi-autonomous unit within CI, whose Board o f Directors has fiduciary responsibility for the program. CEPF i s supervised by a Donor Council, representing each o f the donor partners, supported by a CEPF Working Group comprising CEPF management and technical staff from the donor partners. CEPF has selected one or more NGOs as a Coordination Unit in most o f the active hotspot regions, to represent the program and to manage grant making. C I i s CEPF’s single largest grantee, providing a variety o f coordination, implementation, scientific and administrative services at both headquarters and field levels.
4. Even though CEPF has completed five years o f operations, the program i s s t i l l developing. Slightly less than hal f o f the available grant funds had been received by grantees when this evaluation began, while projects amounting to slightly less than $20 mi l l ion or 20% o f the total grant funds had actually been completed. O f the 15 active grant making programs, three had been active for 4.5 years, seven for 3-4 years and five for less than 2.5 years.
5. The CEPF donor partners initiated an independent evaluation o f CEPF which began on August 15,2005 and focused on grant making through June 30,2005.
The Evaluation
6. The evaluation terms o f reference (TOR) are explicit o n the approach to be followed, stating that the emphasis “should be on the initiative as a whole, not on the effectiveness o f respective field programs”. The TOR also specifies that the evaluation “should not assess the effectiveness o f independent projects but rather the strategic orientation o f the portfolios vis-& vis the larger strategic mission o f CEPF”. The evaluation was carried out by a team o f three independent consultants, the authors o f this report. The needed tasks were planned and
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implemented on an accelerated schedule in order to provide timely inputs to the donors considering imminent refinancing o f CEPF.
7. The evaluation focused o n ten o f the 15 active funding regions. Each was visited during September-October 2005 , generally for 7- 10 days, fol lowing guidelines developed by the evaluation team. The visits included field visits to selected projects, extensive interactions with local coordination mechanism staff, interviews and workshops with grantees and other key stakeholders, and discussions with CEPF’s regional Grant Directors. Outstanding cooperation was received from al l CEPF staff, grantees and partners in facilitating these visits at short notice.
Overall Findings
8. CEPF has made strong progress overall during its f i rs t five years. W h i l e achieving gains in biodiversity conservation within hotspot regions is a long-term challenge, a solid foundation has been laid for the future. The overall performance from a global perspective has been excellent, even though there i s some variation in the performance o f individual hotspot programs.
9. Particularly significant progress has been made in the following areas: . A coherent planning process to guide grant making at the hotspot level has been developed and applied. The Ecosystem Profile methodology has improved significantly over the l i fe o f CEPF after a variable start, with strong scientific support f rom CI. The more recent Profiles have included thorough analyses o f threats and opportunities, identified the key elements o f an ecological baseline for measuring progress, and provided clear strategic directions to guide grant making. The later Profiles have been strengthened by broader and more effective stakeholder consultations. In some cases the Profiles have been used successfully to encourage the participation o f other donors and coordinate the resulting additional investments. . The hotspot grant portfolios are wel l aligned with the strategic priorities set out in the Ecosystem Profiles, most o f which are expressed in fairly general terms. The portfolios typically consist o f a few relatively large grants for program coordination and leadership, several medium-sized grants to relatively capable national and international NGOs for strategic, high-priority projects, and a larger number o f smaller grants (many under $20,000) to emerging c iv i l society organizations carrying out an impressive range o f grassroots activities, some o f which are thematically clustered. While the aggregate early gains from such diverse initiatives are difficult to assess, the overall picture that emerges i s that the projects fit together in a coherent way and that most o f the hotspot portfolios are well integrated and o f significant strategic value for biodiversity conservation. While individual projects were not a primary focus o f the evaluation, design and implementation generally appears to be sound. . The characteristics and capacity o f the c iv i l society constituency being supported by CEPF vary significantly between the hotspot regions, with the result that the term ‘civi l society’ embraces a very broad range o f organizations. The evaluation field visits
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provided ample evidence that the CEPF model is sufficiently flexible to effectively identify and support a range o f c iv i l society organizations o f different types in varying contexts. Few o f these grantees, particularly the less experienced emerging organizations, have access to alternative sources o f funding.
The most significant direct impacts from grant making to c iv i l society have been: (i) capacity building among local and national conservation NGOs; (ii) contributions to extending and strengthening protected area networks: (iii) broadening environmental awareness through effective communications; (iv) enabling local, national and international partnerships to support biodiversity conservation; (v) effective advocacy by grantee organizations in connection with infrastructure and other development projects; and (vi) contributions to sustainable financing for conservation. The portfolios also contain a significant number o f projects that combine community development and livelihood opportunities with biodiversity conservation, thereby contributing to poverty mitigation.
Significant indirect impacts should also result from grants, notably when a particular approach tested or demonstrated successfully by a CEPF project is replicated or scaled up. Other indirect impacts can be expected to include: (i) pol icy changes by governments or new approaches by donors inspired by grantees; (ii) NGO grantees going on to more influential activities as a result o f capacity building and experience gained during a CEPF project; (iii) local communities initiating new environmentally-friendly activities or obtaining services or action from government as a result o f increased s e l f reliance and organizational skills acquired during a CEPF project; (iv) institutional project partners such as research institutions, local governments and national environmental funds adopting CEPF approaches and introducing them to larger communities. Some o f these benefits may not become evident until several years after the activity that stimulated them and are difficult, if not impossible to measure. That does not diminish their value, however. . The Coordination Units, CEPF’s representatives and grant managers on the ground, have provided high quality local program implementation services. The Coordination Units have effectively identified and supported emerging c iv i l society organizations, especially those with l i t t le previous proposal development or project management experience, many o f which are scattered widely in remote locations. C I provides the Coordination Unit at 9 o f the 15 hotspot programs, although 4 o f the last 5 programs activated have drawn on other NGOs in an impressively diverse range o f local institutional arrangements. Although these arrangements have not been problem free, they have worked very well overall.
With roles that go wel l beyond grant program administration, the Coordination Units have emerged as one o f the key strengths o f CEPF. With support from CEPF in Washington, especially the respective Grant Directors, these Units have been particularly effective in linking smaller grassroots activities, larger projects, pol icy initiatives, international collaboration, sustainable financing and other key elements o f comprehensive, vertically-integrated conservation portfolios. The CUs have been
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particularly adept at pursuing constructive partnerships with governments - in some cases multiple governments - while simultaneously supporting c iv i l society organizations which sometimes have uneasy relations with their governments as a result o f their conservation advocacy activities. The label o f Coordination Unit does not do justice to the contribution o f these key strategic partners.
Performance Measurement
10. The approach to performance monitoring has evolved and improved since CEPF was launched in 2000 and it i s a continuing work in process. CEPF i s addressing large scale issues with i t s partners and has a budget that i s only generous by previous NGO conservation standards. Expectations on what can be achieved at the hotspot level within short time periods should therefore be kept within modest bounds, despite the relentlessly success-driven discourse o f the conservation and development communities.
11. I t i s extremely difficult to determine how specific investments or projects o f CEPF affect long term conservation outcomes in a corridor, protected area, nation or region because such outcomes are usually the result o f efforts o f numerous government agencies, communities, NGOs and donors over an extended period and are not easily attributed to a specific short-term investment by one program. An overemphasis on generating short-term (e.g., less than 10 year) conservation successes o n a broad front can be hazardous insofar i t tends to constrain risk and innovation, and restrict the freedom needed to explore more risky undertakings or those requiring more time.
12. CEPF does not regularly assess or report progress at a hotspot level against either the conservation outcomes or the other goals identified in the log frames within each o f the ecosystem profiles. While the CUs have done very good work, they have not focused on analyzing the overall performance o f their hotspot grant portfolios. Exceptional work has been done in communications, but the overall impacts o f the portfolios and progress towards the conservation outcomes had not been systematically compiled and assessed. CEPF does plan to compile a formal report on progress against the log fi-ames for each funding region at the close o f the init ial five-year funding period, starting early in 2006.
13. Most conservation outcomes are unattainable within a five year period. Effective management o f protected areas and especially large corridors must continue indefinitely as there wil l always be new threats and conflicts. Active c iv i l society involvement in governance i s essential for equitable and transparent decision-making and accountability, even though conservation outcomes may not be these organizations’ immediate or major priority. Therefore, to improve performance and evaluation, targeted conservation outcomes require an explicit subset o f short-term benchmarks and targets that can track progress towards the species, site and corridors outcomes. While aiming for these long-term conservation outcomes, the process and implementation o f CEPF grants generates considerable socio-economic, governance, livelihood and related impacts that are not effectively captured in the current performance and evaluation framework.
14. Monitoring in the form o f site visits by the CUs appears inconsistent across the hotspots. The CUs do not perceive their performance monitoring roles clearly, mainly emphasizing
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conservation actions and management o f grant funds. The overall responsibility for project monitoring as a support function as wel l as monitoring o f progress towards outcomes requires further clarification. W h i l e CEPF has developed impressive grant management and grant application software, there i s no comparable system for monitoring and evaluation, and no automatic or other compilation o f project site visit observations or the progress reported by individual projects against the targeted outputs at the portfolio level. The viabi l i ty o f developing and introducing an integrated monitoring and evaluation system should be assessed. Care needs to be taken, however, not to impose a monitoring structure that i s so rigid as to inhibit the vital innovation needed to push the boundaries o f current approaches.
Relationship with Conservation International
15. The relationship with C I provides substantial benefits to CEPF. C I co-initiated, launched and manages CEPF, its Board o f Directors has fiduciary responsibility for CEPF, i t s Center for Applied Biodiversity Science provides technical services, and several o f its regional programs and Centers for Biodiversity Conservation are local coordinators for CEPF. C I also provides a range o f management, administrative and information technology services in addition to having committed $25 mi l l ion to CEPF as an init ial investment. Two C I funds, the Global Conservation Fund and Verde Ventures, as well as C I country programs have provided funding for grant applicants that CEPF was unable to support and have co-financed certain CEPF grants. C I therefore has an extremely close relationship with CEPF on several different fronts.
Start-up Phase
16. CI’s dual role as manager o f the grants program and as a potential grantee presents a potential conflict o f interest. C I i s the largest grantee o f CEPF and by June 2005 had received a total o f $29 mi l l ion in hotspot coordination grants, project implementation grants and management fees. Recognizing this issue, CEPF’s Financing Agreement limits grants to C I to 50% of the total available, with specific Donor Council approval, and the CEPF Operations Manual requires al l grant proposals, whether from C I or from external groups, to be subject to the same decision-making process.
17. As originally required by the CEPF Donor Council, the init ial CEPF Spending Plan attached to the Financing Agreement in 2000 included grants to C I that equaled 50% o f the available resources of $1 1.6 mi l l ion allocated to the first three hotspots, without the projects concerned having been specified or developed in detail. Subsequently, there was considerable pressure on CEPF staff to support funding for relatively large C I proposals, particularly during the f i rst few years o f CEPF. Although the pre-allocation requirement was subsequently changed by the Donor Council in 2001 at the request o f CEPF management, these factors contributed to a widely-held perception that C I was being awarded significant CEPF grants without other options or considerations being fully explored, to the detriment o f the overall program.
18. From CI’s perspective, they were successfdly engaging a range of new donors in supporting valuable conservation initiatives with an exciting new focus on c iv i l society. CEPF had made a strategic decision to begin work in areas where C I already had a strong presence and existing relationships to build upon, so it was not surprising that their country and regional programs would lead the initial CEPF effort. However, this interpretation was not shared widely among
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the technical staff o f donor partners, many external stakeholders or the broader conservation community.
19. These issues have received continual attention from the Donor Council, the CEPF Working Group and CEPF management, who have al l worked hard to overcome the negative impacts o f these early developments.
Recent Developments
20. Subsequent developments related to these issues were examined closely during the evaluation and some important trends became clear: . The share o f CEPF grants to C I fel l from the init ial 50% level to a cumulative 35% by
June 30, 2005, and continues to decline. This trend is largely explained by CEPF expanding into new areas where C I does not have experience or a comparative advantage, and the consequent need to engage with and support new partners and Coordination Units.
9 The evaluation team has concluded that C I has generally done an excellent j ob with the funds it has received from CEPF. The coordination and project implementation services from C I regional programs and Centers for Biodiversity Conservation, the scientific and technical support f rom the Center for Applied Biodiversity Science, as wel l as the administrative, management and information technology services from CI’s headquarters have al l been o f high quality and have provided essential support to CEPF’s c iv i l society grant making. . All transactions and financial flows with C I appear to have been transparently reported, even though some o f these are relatively complex. . The pressure on CEPF staff to support C I grant proposals as wel l as the expectation among C I staff that they should have priority access to CEPF funds has clearly reduced over time, although it has not been eliminated. . While C I has generally done an excellent job with the grant funds i t has received, i t would be hard to argue convincingly that C I has been treated l ike any other potential grantee, as required by the CEPF Operational Manual. . In some hotspots it i s difficult to assess whether certain program activities carried out by C I staff with CEPF grant support “should” have been paid for by C I or by CEPF, with viable arguments on both sides. . C I i tself has recently committed to shifting towards a strategy o f re-granting substantial proportions o f its revenues to support strategic partnerships, rather than trying to “do it all” with their own f ield offices and personnel. This style o f operating i s much closer to the CEPF model, which gave C I one o f i t s first experiences o f an explicit focus on making grants to c iv i l society with an emphasis o n partnerships and alliances.
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21. Despite these generally very positive developments, external perceptions continue to be negatively shaped by the earlier events. Furthermore, the rules and disclosure requirements governing CEPF grants to C I have not so far overcome the potential conflict o f interest when a grantee i s competing with other organizations for grants f rom a fund which it manages. Our conclusion i s that a reorientation o f the CEPF-CI relationship i s needed, to set further limits and to further improve transparency. The result should be to strengthen the credibility o f the arrangement in both reality and perception.
22. Major realignments in the CI-CEPF relationship were considered by the evaluation team, including making CEPF independent o f C I or making C I ineligible for CEPF grants. However, such extreme measures do not appear necessary and it i s evident that such changes would have an enormous negative impact on CEPF’s capacity to operate effectively and to continue developing the highly promising model that has emerged. Instead, the Donor Council may wish to consider the fol lowing elements: . A global limit for C I grants that i s lower than the current 50%.
More systematic and independent peer reviews o f al l grant proposals from CI, including Coordination Unit grants (this should apply to al l international N G O proposals). . More consistent use o f local independent advisory committees to advise on grant proposals (this should apply to al l international NGO proposals). . The Executive Director o f CEPF to report to the Chairman and CEO o f CI, who represents C I on the CEPF Donor Council.
Governance
Donor Council
23. The Donor Council has played an active role in accordance with i t s assigned responsibilities. The guidance and oversight provided by the Donor Council with the support o f the Working Group appears to have been effective and timely, and the Donor Council has made important contributions to fundraising.
CEPF Working Group
24. The Working Group has played an active role in several o f the improvements to CEPF and provided useful input and guidance to the CEPF o n important issues. Continuing efforts to catalyze or facilitate operational collaboration between their own organizations and CEPF need to be strengthened, as described below.
CEPF Management
25. CEPF management has faced a challenging set o f strategic and operational issues during the f i rst five years. Most o f these challenges have been met with great skill and there i s clear evidence o f management’s capacity to learn from experience and adapt to new situations, notably in the selection and management o f local coordination units. CEPF is clearly a
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responsive organization that appears to operate efficiently. During the evaluation management and staff demonstrated an exceptional capacity to respond to a myriad o f requests for data and to rapidly generate products for review. The people engaged as staff, partners and grantees are, almost without exception, capable and impressive.
26. CEPF communications i s exceptionally strong, particularly at a global level. For example, during the 12 months to June 30,2005 visitors to the CEPF Web site downloaded over 65,000 copies o f final project reports, probably drawn by the marketing o f these reports in the CEPF newsletter. These visitors came from at least 130 countries and in total downloaded more than 41 8,000 CEPF documents and reports.
Engagement with Donors
27. As an investment, CEPF provides al l o f i t s donors with a relatively agile, flexible and fast- moving funding mechanism that supports c iv i l society organizations in areas o f global biodiversity significance by disbursing funds in smaller amounts than these organizations generally deal with. CEPF’s emphasis on employing good science, engaging stakeholders, building local capacities, mainstreaming biodiversity and harmonizing donor investments in biodiversity i s also o f considerable strategic value to these organizations, while the capacity to support regional environmental collaboration involving multiple countries provides an important contrast to the more prevalent single country donor model.
28. CEPF’s activities are consistent with and supportive o f the poverty mitigation focus o f the World Bank and the Government o f Japan as wel l as the sustainable development focus o f GEF. There appears to be a strong overlap between the CEPF hotspots and concentrations o f rural poverty, suggesting that those projects supporting alternative livelihoods are likely to be benefiting the poorest o f the poor, many o f whom depend directly on the services provided by the same ecosystems that CEPF i s helping to conserve. I t seems evident that conservation programs such as CEPF are considerably more cost-effective than the massive investments that would be needed to restore such ecosystems if they were to become degraded and lose the ability to provide essential services to the poor (e.g., water, fuelwood, fodder, and flood protection, etc.).
World Bank
29. The potential for operational collaboration with the World Bank was originally highlighted as one o f the key opportunities provided by CEPF’s innovative donor partnership. The potential for such collaboration has not diminished, and appears even greater now that CEPF has implemented a series o f convincing f ield programs and can share knowledge and lessons learned. Potential aside, however, there has so far been l i t t le effective operational collaboration between the World Bank and CEPF at the field level. CEPF i s perceived a C I program and not part o f the Bank’s country programs. Consequently, some important opportunities to build linkages and to broaden CEPF’s impact are being missed, although there are signs that this may be starting to change.
Global Environment Facility
30. GEF has two funding windows providing resources directly to NGOs for biodiversity conservation: the GEF Small Grants Program (SGP) and the GEF Medium-Sized Projects
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(MSPs). So far there have been surprisingly few interactions between CEPF and SGP. There are some important complements in the operational models o f CEPF and SGP which could provide the basis for productive collaboration and cross learning. The MSPs have represented an important opportunity for NGOs to access GEF resources and there may be opportunities to scale up promising CEPF projects through MSPs.
3 1. GEF’s recent adoption o f the Resource Allocation Framework i s expected to significantly change the nature o f GEF operations. There may be a reduction in GEF funding to NGOs as well as fewer opportunities for MSPs to be developed. This suggests that CEPF i s unlikely to decline in terms o f i t s relative importance to GEF as an NGO funding delivery mechanism, and may represent an increasingly valuable opportunity to support c iv i l society with an approach that complements but certainly does not duplicate SGP.
MacArthur Foundation
32. Grants made by the Foundation and by CEPF tend to be broadly complementary. In a few cases, earlier grants from MacArthur have been consolidated by subsequent CEPF grants. While there may some similarities and overlaps, redundancies are not apparent. There are some key differences in grant making. For example, the Foundation does not have an on-the-ground presence corresponding to CEPF’s coordination units. Also, the Foundation has gradually moved towards larger grants, and currently supports few projects corresponding to CEPF’s smaller grants. At present, there is l imited information f low between the Foundation and CEPF, although Foundation staff have provided valuable inputs to Ecosystem Profile drafts. Opportunities for improved information sharing should continue to be assessed and Foundation staff should be encouraged to participate where appropriate once collaboration between the World Bank and CEPF starts to take off.
Government o f Japan
33. The Government o f Japan appears to value i t s investment in CEPF for many o f the same reasons as the World Bank and GEF. The Japanese Ministry o f Finance has also been particularly concerned that CEPF grant programs demonstrate a positive contribution to poverty mitigation. As CEPF analyses have suggested and the findings o f this evaluation have confirmed, CEPF i s supporting long-term poverty mitigation efforts on several fronts.
Program Priorities
34. The CEPF model o f support to c iv i l society for biodiversity conservation in hotspots has made a very promising start and the experience to date does not suggest any need for radical changes in strategy or approach. Assuming that CEPF receives further financial resources to continue beyond the five year start-up period, priorities do need to be determined for the next phase.
35. The evaluation findings suggest a cautious approach. While the progress made in CEPF’s f i rst few years has been very positive, i t i s s t i l l too early to assess the sustainability o f impacts. CEPF’s ambitious long-term goals cannot be met in one or even a few five-year periods. Even though CEPF works mainly with and through c iv i l society, many o f the challenges being addressed by CEPF programs wil l ultimately require major changes in policies and behavior by
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governments and other actors, none o f which can be brought about rapidly or without continued attention.
36. This suggests that consolidation and gradual expansion should be the strategic priorities for the next phase, to ensure that: (i) the benefits gained so far are nurtured and sustained; (ii) lessons from experience to date are identified and reflected in continuing operations; (iii) the tools and methodologies for monitoring performance are developed further; (iv) the relationship with C I is optimized and (v) operational collaboration with donor partners i s strengthened.
Recommendations
Allocation of Resources
37. Broad decisions wil l need to be made o n how and where new financial resources for grant making are to be allocated across the global program. Key decisions wil l include: (i) whether to reinvest in the init ial CEPF funding regions, (ii) whether to expand the number o f active hotspots and by how many; (iii) the level o f resources to be allocated to individual hotspots; (iv) whether to expand the scope o f CEPF to include new geographic areas or land use designations beyond the current focus o n terrestrial hotspots.
3 8. Following the proposed principle o f consolidation and gradual expansion, considerable care should be taken not to dilute the clear and transparent mission o f CEPF, which i s relatively easy to communicate and provides clear direction and inspiration to staff, partners and
’ grantees.
39. Discontinuing support for any region does not seem warranted at this early stage in the development o f CEPF, particularly as many o f the conservation outcomes have an anticipated time frame o f considerably more than five years. As this report has emphasized, significant, long-term progress towards these outcomes requires sustained investments.
40. The evaluation team was asked to consider the option o f concentrating significantly more financial resources in individual hotspots with the aim o f achieving greater impacts. W h i l e such decisions should be made on a case-by-case basis, we have concluded that there are some disadvantages to such an approach:
CEPF’s ability to use resources effectively i s limited by the absorptive capacity o f local c iv i l society grantees. In the hotspots visited, even though some grant funds appeared to be oversubscribed after their init ial call for proposals, there seemed to be a reasonably good fit between the available CEPF grants resources and the viable project concepts being put forward by local c iv i l society organizations. . CEPF’s influence appears to owe more to i t s excellent people, astute decision making, leverage and flexibility rather than the sheer amount o f financial resources that i t can bring to bear. A significant increase in grant resources would require more staff and a greater management effort from the Coordination Units to maintain the current high levels o f technical support provided to grantees - one o f the clear strengths o f the program. While the CUs are proving very capable in their current role, to significantly
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and suddenly upgrade their grant management capacity could place excessive demands on these organizations. . Increasing the duration o f the program, i.e., going wel l beyond five year periods, would appear a more productive investment and one more consistent with the time frame likely to be needed to generate sustainable gains at a significant scale.
Conversely, an alternative approach which spreads resources over more regions than at present also has drawbacks. I t i s evident that CEPF senior management spends a considerable amount o f time refining strategies, making critically-important decisions and providing other inputs to each hotspot region, especially during the start-up phase. Senior management also invests considerable effort in seeking new donor partners, negotiating global grants, securing cofinancing and supporting new trust funds. This level o f effort per hotspot seems related to the number o f hotspots and the diversity o f institutional and management challenges they represent rather than the level o f financial resources available for grant making. In other words, a significant element o f f ixed management costs are incurred by operating at each hotspot site. I t can therefore be anticipated that a rapid and significant expansion in the number o f hotspots would require at least a proportional expansion in CEPF’s senior management capacity.
Performance Moni tor ing
42. A priority for the next phase o f operations wil l be to strengthen performance monitoring at a hotspot level in two specific directions. First, both the Grant Directors and CUs need to be more involved in portfolio performance reporting on a regular basis. Second, the use o f conservation outcomes as long-term operational targets should be complemented by the development and adoption o f socio-economic, political and c iv i l society measures and indicators that wil l provide more feedback on CEPF’s interim progress towards these outcomes.
43. The performance assessments o f each o f the hotspots that are planned to start in 2006 represent an important opportunity that wil l probably require considerable resources, and this needs to be planned and implemented with considerable care if it i s to prove o f significant value to the program. A strategic and programmatic approach i s needed to these assessments, that should constitute a major activity o f the second five years for CEPF. Some o f the key issues that should be taken into account are: (i) connecting these assessments to updates o f the Ecosystem Profiles for programs that are to be refinanced; (ii) linking these reviews with the development and testing o f new performance monitoring methodologies and systems, including indicators to reflect the nature o f and changes induced in c iv i l society to complement the conservation outcomes; (iii) ensuring that portfolio-level lessons are identified and disseminated; (iv) ensuring the reviews are participatory by involving grantees and other partners; and (v) exploring opportunities for cross-learning between portfolios to help achieve global program synergies.
Ecosystem Profiles
44. The Ecosystem Profiles have proven to be an effective tool for planning and guiding grant making, and have improved over time as lessons from the earlier experiences have been applied. The Profiles are reviewed carefully by the CEPF Working Group and eventually
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approved by the Donor Council, thereby providing these bodies with their most important opportunity to influence site level grant making.
45. The completed Ecosystem Profiles have strategic priorities expressed in fairly general terms. This has so far proved to be an advantage, by providing the flexibility to make decisions on the ground as local grant making knowledge and experience accumulates and the capacity o f each Coordination Unit grows. N o w that the existing CUs have greater capacity and an enhanced understanding o f local c iv i l society grant making, consideration should be given as to whether strategic priorities should: (i) become more specific and targeted based on a better understanding o f the local grant making opportunities; or (ii) remain more general to encourage decentralized decision making. Site-specific, case-by-case solutions wil l probably be required, based on a clear appreciation o f the capacities o f both the C U and local c iv i l society organizations.
46. Updated Ecosystem Profiles and revised strategic directions and investment priorities may indicate the need for grant portfolios to be realigned in funding regions to be refinanced. Future Ecosystem Profile preparation processes should include consideration o f poverty issues, payments for ecosystem services and the value o f ecosystem services, reflecting the findings o f the Mil lennium Ecosystem Assessment and consistent with the U.N. Mil lennium Project.
Coordination Units
47. The CUs have been highlighted as a major strength o f CEPF, demonstrating the viability o f an innovative range o f institutional arrangements and providing services that go well beyond grant program administration. The role and functions o f the CUs could s t i l l be defined more explicitly, however, including their responsibilities for project monitoring and portfolio performance reporting. The C U selection process should be opened up further to consider more national organizations, and consideration should be given to the use o f more open bidding processes for new coordination grants. The coordination arrangements in the f i rst three funding regions (Guinean Forests, Madagascar and Tropical Andes) should be reassessed as their init ial five year funding cycle is completed in 2006 and, in the case o f Tropical Andes, should be reestablished.
48. I t wil l become increasingly important to consider the long-term future o f the CUs once they emerge successfully from the early phases o f grant making. There i s a clear need to develop the capacities o f local and national NGOs, as CEPF i s already doing, and to seek opportunities to delegate increasing authority and responsibility to these organizations to increase the local ownership o f conservation programs. On the other hand, a too-rapid wind down by the C U can jeopardize the sustainability o f the gains made to that point.
Integration with Donor Partners
49. Strengthening the operational collaboration with donor partners should be an explicit and early priority o f the next phase o f CEPF. In order to be effective, this will require considerable efforts on behalf o f both CEPF and the donor partner organizations.
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Grants to International NGOs
50. Within the current portfolio, international NGOs have made important contributions not only as CUs but also by implementing strategic projects and managing small grant funds as intermediaries between the CUs and some o f the smaller and more scattered or remote grantees. In total international NGOs had received 59% o f CEPF’s grants through June 30, 2005 (including CI’s 35% share). CEPF management and some o f the donor partners have expressed the importance o f gradually reducing the proportion o f grants going to international rather than local and national NGOs. Having studied the grants data, the evaluation team concurs. However, this issue has some complex aspects and care needs to be taken before imposing arbitrary limits on CEPF grant making to international NGOs. The international conservation NGOs often have significant capacities and experience in organizational management, communications, fundraising and negotiating transboundary issues. In some contexts, they can also negotiate more effectively with governments and large private sector f i r m s than national organizations. W h i l e we strongly support further decentralization o f decision making within CEPF as the capacities o f local and national organizations grow, there are clear conservation benefits to be derived from the participation o f the international NGOs. Such decisions should again be made on a case-by-case basis.
Sharing Knowledge and Lessons
5 1. Although excellent work has been done in developing and disseminating communication materials for non-technical and non-specialist audiences, more attention needs to be given to the systematic analysis and documentation o f CEPF results and experiences. Lessons learned are not emerging at the portfolio level yet, probably because o f the general lack o f emphasis o n portfolio-level performance reporting at this early stage in the majority o f portfolios and because o f reluctance to acknowledge or document problems and difficulties, even if these eventually became important learning experiences that have led to a stronger program.
52. W h i l e CEPF is exceptionally strong in communications, i t has not found i t easy to identify and disseminate lessons. While CEPF has clearly adapted its approach and learned from experience, this has taken place as a result o f informal information sharing within the organization combined with skillfully adaptive management. Either through C I or independently, CEPF should enhance i t s capacity to conduct more balanced analyses o f i t s experiences that i s distinct from communicating conservation successes.
Operational Recommendations
53. Certain operational areas have been identified where improvements can be made:
In some hotspots there i s some duplication o f effort between the tasks carried out by the local Coordination Units and those o f CEPF’s US-based Grant Directors, most o f which could be addressed by further decentralization o f decision making to the local level. In general, there appear to be good opportunities for decision making to be further decentralized once hotspot grant programs have demonstrated their capabilities by successfully progressing beyond their start-up phase, although such delegation o f authority and responsibility should be approached cautiously o n a case-by-case basis.
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. CEPF headquarters negotiates and arranges multiregional grants to single donors that are intended to complement grant made locally through the Coordination Units. Such grants have sometimes been able to provide comparable services to multiple hotspots or to take advantage o f significant cofinancing opportunities, particularly with the private sector. However, in some cases the cost-effectiveness o f these grants i s not evident and key management information has not always been communicated effectively to the respective local Coordination Units. In such cases the CUs are unclear about their responsibilities for monitoring and supervision, and there i s a lack o f integration with the rest o f the hotspot portfolio.
CEPF’s grant application procedures are demanding, so much so that they represent a severe challenge to many potential grantees. Although the application procedures have been simplified, there is room for further streamlining. . The use o f CEPF’s grant management system by the CUs i s variable and appears to face a variety o f technical constraints that require continued attention.
Overall Message
54. The donors have launched a very promising and special program in CEPF. This innovative model f i l ls a unique niche in international biodiversity conservation and is being implemented by a very professional global team plus partners who have made excellent early progress towards their long-term goals. W e have no hesitation in recommending that the donor partners continue funding the program and seeking further expansion opportunities.
This map was produced by the Map Design Unit of The World Bank.The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.
