Inter-institutional Dynamics of Global Climate Finance: Complementarity and Competition in the Emerging Practices of Coordination
Climate finance was incepted as a form of international development under the umbrella of the 1992 United Nations Framework Convention on Climate Change for the purposes of implementing emissions reductions and adaptation measures in developing countries. After more than twenty years from its formulation, climate finance has transformed into a complex activity comprising public and private financial flows. As a result, the global institutional sphere is currently populated by numerous and diverse entities, and is rooted in a pluralist normative realm, where international institutions and national administrations alike act at the same level of regulatory action.
This has led to an ever-increasing institutional fragmentation often resulting in lacks of legal coherence, uncoordinated implementation and, ultimately, poor governance.
Against this background the paper – by focusing only on those institutions governed by public law – addresses two specific questions: i) how climate finance institutions interact and coordinate; and ii) what kind of practices and issues emerge under the purview of Global Administrative Law (GAL).
Before doing this, it is argued that in such a heterarchical institutional reality the two dynamics of complementarity and competition stand at the basis of inter-institutional linkages: complementarity means that synergies are promoted, where functional and geographical overlapping occurs. On the other hand, the limited financial resources raised by industrialized countries bring the same institutions to compete so that they can catalyze more financial resources to the detriment of parallel institutional realities.
The following analysis reveals some preliminary findings: namely, that climate finance institutions are already engaging into mechanisms that enhance complementarity. In fact, although more research is needed, three main patterns are emerging: i) external initiatives; ii) unilateral initiatives by climate finance institutions; and iii) direct inter-institutional coordination engendered by institutions themselves.
It is finally argued that while the scattered and soft nature of these initiatives is far away from yielding a comprehensive framework of coordination, the matter is made more complex by the high degree of informality of inter-institutional linkages. Under a GAL understanding, this might lead to issues of accountability of climate finance institutions.
David Rossati is doctoral candidate and teaching assistant in International Climate Change Law at the Edinburgh School of Law.