Overview
GCF ensures that the climate finance it allocates does not harm local communities or ecosystems. GCF standards include equitably managing environmental and social risks in relation to its activities, as well as implementing an Indigenous People’s Policy to reflect the importance of fully and effectively engaging with indigenous peoples in the design, development and implementation of the strategies and activities to be financed by GCF, while respecting their rights.
GCF is also the first climate finance mechanism to mainstream gender perspectives from the outset of its operations as an essential decision-making element for the deployment of its resources.
Environment and Social Management System
GCF's Environment and Social Management System (ESMS) is made up of processes and procedures which help GCF identify, analyse, avoid, minimise, and mitigate any potential adverse environmental and social impact of climate finance activities. The ESMS is designed not only to avoid harm, but to improve the environmental and social performance of GCF and the activities it finances consistently over time.
Accredited Entities are at the frontline of these safeguards. GCF accredits a broad range of international sub-national, national or regional organizations to propose and implement GCF-approved climate initiatives. The accreditation process ensures these institutions are not only capable of strong financial management, but that they can safeguard GCF projects against any unforeseen environmental or social harm. Accredited Entities need to put in place environmental and social management systems that incorportate institutional policies, processes and safeguards standards. Where gaps or weaknesses exist, GCF requires Accredited Entities to address them. This ensures an effective environmental and social management system is in place before GCF-financed activities are implemented. Once projects have begun to be implemented, GCF will continue to evaluate the environmental and social performance of the Accredited Entities and supported activities.
Seeking redress
A number of independent units have been set up as third-party guarantors of ethical GCF practice. When allegations of environmental and social harm are raised in association with GCF activities, it is possible for affected parties to contact one of these units, the Independent Redress Mechanism (IRM). The IRM operates outside of the GCF Secretariat and reports directly to the GCF Board, which oversees GCF management. The IRM responds to complaints by people who feel they have been adversely affected, or may be affected, by GCF projects or programmes, including issues related to GCF's environmental and social safeguards. The IRM helps project-affected people by facilitating dispute resolution processes to seek joint solutions, or by conducting independent compliance investigations and recommending redress where appropriate.
Complainants can approach the IRM confidentially if necessary. All GCF-financed activities, including those affecting Indigenous Peoples, are required to establish a grievance redress mechanism at the project level to address any projectrelated concerns, in consultation with the affected or potentially affected communities.