Adaptation Fund Releases Review of Interim Arrangements

Adaptation Fund5 November 2011: A performance study of the Secretariat and Trustee of the Adaptation Fund, performed at the request of the Conference of the Parties Serving as the Meeting of the Parties (COP/MOP) to the Kyoto Protocol, has been made available on the Adaptation Fund website. The study reviews legal arrangements, the cost effectiveness of administration, the effectiveness of project reviews and other relevant management policies. 

The study aims to assess the effectiveness and adequacy of the Adaptation Fund and its interim institutional arrangements, namely with the Global Environment Facility (GEF) as the Secretariat, and the International Bank for Reconstruction and Development (IBRD) as Trustee. The study examined: the existence and adequacy of key policies and procedures; the existence of key controls; the governance and organizational structure of the Adaptation Fund; and the adequacy of the Secretariat's resources.

The report concludes that the Adaptation Fund Board Secretariat has operated well, but suggests that given the increased size of operations, it may be appropriate to consider a more formal organizational approach with a more independent structure. It suggests a review of the current staffing level of the Adaptation Fund, given the size of the project pipeline, and that the Adaptation Fund Secretariat should take on an increased oversight role over the Trustees activities.

It also suggests that the Adaptation Fund Secretariat should invoke additional control over project disbursements. The report suggests considering allowing the Adaptation Fund Secretariat to act in an independent role with managerial capacity. It highlights the limitations of the Adaptation Fund Board of Directors to act as the executive body of the Adaptation Fund, given the Board of Directors' country-specific ministerial duties.

On the evaluation of the Secretariat, the report finds strengths in: the availability of a motivated core team; developed technical skills; operational procedures; effectiveness of administrative tasks for Board meetings; and assistance from the GEF staff. The report describes two options for the Adaptation Fund going forward that would result in an independent Secretariat. The review also assesses the role of the IBRD, noting the need for more clarity on liability for credit losses, since the Adaptation Fund funds are commingled with other trust fund assets managed by the IBRD. [Publication: Review of Interim Arrangements of the Adaptation Fund]