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Corruption and Climate Governance

This Featured Research article takes an in-depth look at interesting avenues of research in the emerging area of corruption and climate governance.

This article appears in the 7th issue of the Anti-Corruption Research News, the newsletter of the Anti-Corruption Research Network. You can download the full newsletter here.

Bridging agendas: How anti-corruption research can improve climate governance

By Krina Despota, Transparency International

Climate change presents perhaps the greatest governance challenge the world has ever faced. Research on the science of climate change—its causes, its consequences, its solutions—has been ongoing for decades. Yet research that examines the intersection of corruption and climate governance is a nascent field. While many academic and advocacy-oriented researchers are beginning to examine the human, environmental and economic costs associated with corruption in climate governance, such efforts need to be scaled up to match the urgency of the challenge before us.

By no means exhaustive of the good work being done on this topic, this article introduces a few of the most prevalent issues in the area of climate change and corruption research.  

Undue influence and conflicts of interest (and gaps)

Mitigating climate change means transforming energy policies, changing consumption patterns, and developing and implementing new low-carbon technologies. Such sweeping change carries economic opportunities for some, and, at least in the short term, challenges  to established business models for others.

Affected are some of the most powerful and lucrative industries in the world. Oil and gas interests will have to adjust to policies aimed at reducing reliance on fossil fuels. Investment banks, alternatively, may be well-positioned to earn considerable profits through participation in carbon markets, which monetise reduction of greenhouse gas emissions. Added to this mix are thousands of smaller industry and civil society groups that carefully follow and engage in the local, national and international debates that shape climate change policy. 

Understanding how these groups interact with policy-makers and to what extent they are influential is crucial to ensuring that the mitigation policies that are eventually adopted are selected for their effectiveness, and not as an outcome of undue influence. This question of policy capture has been particularly salient regarding the development and design of carbon markets. However, methods for measuring potential undue influence vary.

In the US, mandatory lobbying registries allow researchers to “follow the money” that was poured into lobbying activities in the run-up to a Congressional debate on a climate change bill that included carbon markets.1 Direct tracking of expenditure enables a comparison of spending by various interest groups, demonstrating, for example, that oil and gas interests outspent environmental groups by a factor of eight in 2009.2 Such comparisons can inform analysis of how such disparities might influence climate policy decisions.

In Europe, where there is no mandatory disclosure of lobbying expenditure, researchers have relied on proxies—such as participation in open stakeholder meetings, surveys, or calls for papers initiated by the European Commission—to determine the proportional weight of businesses and other groups in the shaping of climate policy.3 In one recent report, researchers rely on freedom of information requests to review email exchange and analyse drafts of EU initiatives on climate commitments. They have identified “cozy” relationships between a leading European business group and the related EC Directorate and argue that such close ties between business and European institutions threaten to dilute the ambition of proposed regulation on carbon markets and emission reductions targets.4 

While it is impossible to draw a direct line between lobbying efforts and final policy outcomes, these various approaches start to form a picture of how private businesses might influence public climate policy.

 Do perceptions of corruption stifle investment for mitigation?

In addition to probing the possibility of undue influence within national or regional climate policies, researchers are also asking how perceptions of, or experiences with, corruption might shape a country or an investor’s willingness to fund developing-country mitigation efforts.5 For example, researchers at the Austria-based International Institute of Applied Systems Analysis interviewed experts on solar power and determined that regulatory risks—defined as corruption or complexity surrounding bureaucratic procedures—was perceived to be the greatest threat to renewable energy investment in North Africa. They then tried to determine the cost of this additional risk, calculating that roll-out of new solar technologies in North Africa would be triple that of a similar roll-out in Spain, where bureaucratic corruption is not perceived to be as pervasive.6

Such work is complemented by a nascent body of literature that provides more in-depth explorations of the social, political and economic costs that accrue when weak governance systems and corruption create opportunities for reckless profiteering in booming green economy markets.7

The growing scramble for land that has followed the emergence of biofuels as a possible alternative to fossil fuels is one such issue. Many researchers are now seeking to understand the social and economic impacts of large-scale land acquisition on local communities.8 Their findings suggest that foreign land investment is all too often accompanied by denial of land or water access to local farmers, inadequate compensation agreements and displacement by force.9 

Continuing research on this topic should not only lead us to better map how corruption in land acquisition for biofuel production siphons benefits and opportunities from local communities, but, more importantly, it should arm practitioners with actionable solutions to improve governance in this area. 

Research on climate adaptation

A growing body of research is also focusing on the funding mechanisms that are being put in place to help developing countries adapt to climate change. Those least responsible for climate change—the poorest and least industrialised countries in the world—will likely bear the greatest brunt of its impact. As a result, many development organisations, environmental groups and academics have focused their research efforts on how to ensure effective and accountable funding for adaptation in the face of a very fragmented institutional landscape.

Researchers are assessing whether the various bodies tasked with managing adaptation funding, including the World Bank, multilateral development banks, and the UN Global Environmental Facility, have sufficient mechanisms in place to ensure transparency and accountability.10 Efforts also include research that tracks developed country pledges for adaptation funding and attempts to confirm whether the commitments made are “new and additional” to funds already pledged as development aid.11

Mechanisms for delivery of climate finance are also being analysed to find ways to ensure that funds are effectively used at national and local level. Stronger representation of developing countries within funding bodies, for example, is seen as one means of ensuring local-level ownership of climate finance, while enhanced civil society engagement is considered to provide another layer of oversight.12   

Researchers are trying to identify appropriate indicators and measurements of success for adaptation projects13 and considering how relatively new approaches, such as crowd sourcing techniques, can be used for local-level monitoring of projects.14

In addition to questions of equity and effectiveness of adaption funding, attention is now turning to both the predicted and already manifest impacts of climate change. Developing effective and transparent solutions will require significant collaboration and awareness across research communities. Lessons from international policy research and security studies, for example, can help to anticipate the challenges to good governance which are likely to arise in the case of widespread climate-related migration.15 Corruption—still a relatively taboo topic in the humanitarian aid community—will also have to be addressed more directly in research that aims to inform planning for increasingly frequent and intense natural disasters brought about by climate change.

Climate policy: An urgent need for more anti-corruption research

As the solutions to climate change become ever-more urgent, it will be increasingly important that systems for good governance are given greater priority. Research that explores where corruption might undermine the selection, development or implementation of climate change mitigation and adaptation solutions is a critical element for guaranteeing that we have the most suitable and robust strategies for addressing this global challenge.

 


References

1. Please see http://www.publicintegrity.org/investigations/climate_change/

2. P. Blumenthal, ‘US climate policies: a snapshot of lobbyist influence’ in Transparency International (ed.), The Global Corruption Report: Climate Change (London: Earthscan, 2011)

3. A.T. Gullberg, ‘Equal access, unequal voice: business and NGO lobbying on EU climate policy’ in Transparency International (ed.) (2011)

4. B. Balnyá & O. Reyes, Caught in the cross-hairs: how industry lobbyists are gunning for EU climate targets (Brussels and Barcelona: Corporate Europe Observatory and Carbon Trade Watch, 2011)

5. In addition to the example given in the text, please see: D. Frame & C. Hepburn, ‘An Issue of Trust: State Corruption, Responsibility and Greenhouse Gas Emissions’, Environmental Research Letters, vol. 5, 2010

6. N. Komendantova et al., ‘Perception of risks in renewable energy projects: the case of concentrated solar power in North Africa’, Energy Policy (forthcoming); See also, N. Komendantova & A. Patt, ‘Could corruption pose a barrier to the roll-out of renewable energy in North Africa?’ in Transparency International (ed.) (2011)

7. K. Deininger et al., Rising Global Interest in Farmland: Can it Yield Sustainable and Equitable Benefits? (Washington: World Bank, 2010)

8. See, for example, S. Daniel & A. Mittal, (Mis)Investments in Agriculture: The Role of the International Finance Corporation in Global Land Grabs (Oakland, CA: Oakland Institute, 2010); L. Cotula et al., Fuelling Exclusion? The Biofuels Boom and Poor People’s Access to Land (London: International Institute for Environment and Development [IIED], 2008); M. Kugelman & S. Levenstein (eds.), Land Grab? The race for the world’s farmland, Woodrow Wilson International Center for Scholars - Asia Program, 2009

9. See also, S. Bringezu & R. Bleischwitz, ‘Preventing a resource curse fuelled by the green economy’ in Transparency International (ed.) (2011)

10. R. Klein, ‘Show me the money: Ensuring equity, transparency and accountability in adaptation finance’ in Transparency International (ed.) (2011)

11. See for example, M. Pallemaerts & J.Armstrong, Financial Support for Developing Countries for Climate Change Mitigation and Adaptation: Is the EU meeting its commitments? (London Institute for European Environmental Policy [IIEP], 2009); L. Schalatek et al., ‘Where’s the Money? The Status of Climate Finance post-Copenhagen’, Climate Finance Policy Brief, no. 1, 2010; the World Resources Institute also produces summaries of climate finance pledges put forward by developing countries.

12. A. Ballesteros et al., ‘Power, responsibility, and accountability: re-thinking the legitimacy of institutions of climate finance’¸ World Resources Institute Working Paper, 2009 

13. M. McKenzie Hedger et al., Evaluating climate change adaptation from a development perspective (Brighton: IDS, November 2008)

14. See for example, AidData, which tracks development finance in an extensive public database and offers a model for tracking adaptation funding and gathering local-level feedback on project development

15. See, I. Boas & R. Dobson, ‘Disrupting lives: climate migration and corruption’ in Transparency International (ed.) (2011) 

 

Author :

07 Sep 2011


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