Guidance on Risk Management Framework: Legal Risk

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Guidance on Risk Management Framework: Legal Risk

  1. The purpose of this Guidance is to set out the guidelines for identification, prevention, mitigation and management of legal risks arising from the activities and operations of GCF. This Guidance elaborates on the categories of legal risk as outlined in the Risk Management Framework component I – revised risk register adopted pursuant to decision B.17/11, and further expands the scope of legal risk categories.
  2. This Guidance aims to identify in a non-exhaustive manner certain key sources of legal risks to which the Fund is exposed in its day-to-day operations and of which all GCF Personnel should be aware. It also establishes the principles and guidance to be followed by the GCF Secretariat to address the sources of legal risks described herein.
  3. This Guidance shall provide the following:
    1. Greater clarity on the risks inherent in individual decisions and the day-to-day functioning of GCF in order to make appropriate trade-offs; and
    2. Greater consistency in decisions across the organization, with due observance of any relevant Board guidance and decisions, on how much risk is acceptable and how the risks should be managed.
  4. This Guidance should be read in conjunction with other risks contemplated under the GCF Risk Management Framework, such as investment risk, non-financial risk, reputational risk, funding risk and compliance risk.
Cover date 30 July 2021
Document type Policies, strategies, and guidelines
Table of contents
  1. Purpose and Objectives
  2. Definitions
  3. Legal Risk
  4. Key Sources of Legal Risks
  5. Exercise of Contractual Remedies by GCF under legal agreements
  6. Administrative Provisions