Accreditation PanelThe accreditation panel is composed of six international experts in areas related to the fiduciary standards and environmental and social safegaurds of the Fund. The panel is considered a technical advisory body accountable to the board. Its role is to review applications for accreditation and assess applicant’s ability to meet the standards set by the Board.
Accredited entityThe GCF channels its funding for climate actions in developing countries through accredited entities (AEs). GCF AEs can be international, regional, national and sub-national entities, including public and commercial banks; international and bilateral development agencies; ministries or other government agencies; private sector actors; and other non-governmental organizations. In order to be accredited to the GCF, applicant entities need to apply for accreditation and fulfill accreditation requirements set by the GCF, such as environmental, social and gender safeguards and financial and project management principles and standards. They are accredited for five years and then need to reapply.
Accredited observer (organizations)The GCF allows for a wide range of observer organizations to be accredited with the GCF. An accredited observer organization can register its organization’s representatives to attend the meetings of the GCF Board and will receive information shared by the GCF Secretariat. Accredited observer organizations are also often invited to submit recommendations in public calls for input on certain GCF policies.
Active observerThe GCF encourages the participation of a wide range of accredited observers. In addition, it recognizes two representatives from the private sector and two representatives from civil society organizations (one each from developed and developing countries) as active observers. They are the only observers that can speak in GCF Board meetings on behalf of their respective constituency and fulfill a coordinating, outreach and information-sharing role. Active observers are self-selected by their constituency and serve for a two year period, which can be renewed once.
Concept noteEntities planning to submit funding proposals to the GCF can chose whether they send in a full proposal at once, or whether they start with a leaner concept note, in consultation with the National Designated Authority or Focal Point. The GCF Secretariat would give early recommendations to the concept note and would clarify whether the concept is endorsed, not endorsed with a possibility of resubmission, or rejected. The GCF concept note form is 7 pages long, while the full proposal is based on a form of currently 26 pages.
Conference of PartiesAlso referred to as COP is the highest decision making organ of the UNFCCC and to the Convention. All States that are Parties to the Convention are represented at the COP, the meeting reviews and assess the progress in dealing with climate change and the implementation of the Convention. The COP meets every year, unless the Parties decide otherwise. Most GCF operations are guided by the decision of or guidance from the COP.
Country Ownership/ Country-drivenThe principle of country ownership comes from the aid effectiveness discourse and it is one of the core principles agreed in the Governing Instrument of the GCF. The principle of country ownership goes beyond a narrow focus solely on government-funder interaction and also implies meaningful participation of and accountability to a broad range of domestic stakeholders.In the context of climate finance and the GCF, country owernship implies the following: climate finance is aligned with national strategies and priorities; decision-making responsibilities are vested in institutions within the country; national systems are used for ensuring accountability in the use of climate finance; and comprehensive and inclusive multi-stakeholder processes are utilized to develop country strategies, oversee their implementation, and evaluate their outcomes, thereby contributing to domestic accountability.
Direct accessFor various reasons the principle of country ownership has rarely been realized to its full extent. Therefore, it shouldn’t be viewed as a static state, but rather a principle that should be progressively realized over time.
Enhanced direct accessIn the context of the GCF a “country-driven approach” is also frequently used to signal that recipient countries should play an important role in shaping GCF funded climate actions in their own countries without necessarily fulfilling all of the aspects of ‘country ownership’.
Executing entityWhile most climate funds require countries that seek funding support to go through accredited international organizations (such as MDBs or UN agencies), the GCF allows both international and direct access. Under direct access countries wishing to receive GCF funding can work with regional, national or sub-national implementing entities that have been accredited with the GCF, such as government ministries, regional organizations, or domestic private sector actors or civil society organizations. This strengthens the ownership of developing countries over GCF funding they receive, since countries need to endorse direct access entities before they can seek accreditation with the GCF.
Gender Policy/Gender Action Plan 2015-2017Enhanced direct access (EDA) is an innovative financial modality under the GCF. It allows accredited direct access entities to not just request funding from the GCF for a specific individual project but for a suite of activities under a programmatic approach. Under EDA, the GCF would approve the entire program. Funding decisions on individual activities under the program would then be made by the accredited direct access entity. This means that effectively the decision-making for individual GCF projects is “devolved” from the international to the national level. EDA is currently in a pilot-phase.
National Designated Authority and/or Focal PointAn executing entity (EE) is selected and supervised by a GCF accredited entity for the implementation of GCF funded projects on the ground and reports only to the AE. One GCF project can have several executing entities. Like accredited entities, executing entities can be a variety of actors, international, regional and (sub-)national and public or private. Unlike the AEs they do not have a direct contract with the GCF but are effectively “sub-contractors” chosen by the AE.
Gender Policy/Gender Action Plan 2015-2017At its 8th meeting, the GCF Board adopted a gender policy. This aims to a) achieve greater and more equitable impact, b) promote equality between men and women in contributions and benefits from GCF programmes, c) mitigate against potential programme risks for men and women, and d) contribute to reducing the gender gap from climate change-exacerbated vulnerabilities. This policy is accompanied by a gender action plan (2015-2017) which provides a time-bound framework within which to operationalize the gender policy.
National Designated Authority and/or Focal PointDeveloping countries must designate, according to their preference a National Designated Authority (NDA) or Focal Point (FP) as a contact point between the country and the GCF. The NDA and FP play a fundamental role through a “no objection procedure”, that ensures all project and program proposals submitted by an accredited entity, is in line with the country's priorities and needs.
Governing InstrumentThe Governing Instrument provides a wide range of parameters, standards and principles to guide the GCF operations, in particular the decision-making process of the GCF Board.
Implementing entityAn implementing entity (IE) is an international, regional, national or sub-national entity that can be either public, private or non-governmental and is accredited with the GCF. Funding for GCF projects and programs in recipient countries always flows through IEs. IEs either directly implement GCF projects and programs or supervise the implementation of GCF projects and programs through executing entities which they select. IEs have a contract (legal agreement) with the GCF and have to regularly report to the GCF on project implementation and outcomes. Among its accredited entities, the GCF differentiates between implementing entities, which only manage projects and specialized IEs that are called intermediaries. In contrast to IEs, intermediaries also have the ability to pass on GCF funding to other organizations in the form of grants, loans, equity investments and risk guarantees.
Independent Integrity UnitThis mechanism is in charge of investigating allegations of fraud and corruption and other prohibited practices( such as coercive and collusive practices, abuse,conflict of interest and retaliation against whistle blowers). Such investigation needs to be conducted in line with best international practices and in close coordination or cooperation with relevant counterpart authorities
Independent Redress MechanismThe Independent Redress Mechanism (IRM) is in charge of receiving complaints relating to the operation of the Fund.Complaints can be made by a group of persons who have been directly affected by adverse impacts from a project or programme funded by the GCF due to failure to implement the Fund’s environmental and social safeguards, or the failure of the Fund or its implementing entities or intermediaries to comply with these policies. The IRM will evaluate the situation and make recommendations.
Independent Technical Advisory Panel (ITAP)The ITAP was established by the Board to provide an independent technical assessment of and advice on funding proposals. The Panel’s assessment is one of the inputs considered by the Board when it makes funding decisions. The Panel is an independent technical advisory body that is accountable to the Board.
IntermediaryIn accrediting entities which receive its funding,the GCF differentiates between implementing entities, which only manage projects and specialized IEs that are called intermediaries. Intermediaries are most often public or commercial international, regional or domestic banks or bilateral development agencies. In addition to project management, they also have the ability to pass on GCF funding to other organizations in the form of grants, loans, equity investments and risk guarantees. To demonstrate these capacities, entities seeking GCF accreditation as intermediaries have to fulfill special sets of fiduciary requirements.
International accessInternational access is at the moment the predominant funding modality in existing climate funds. It is one of two finance access modalities under the GCF. It requires a country seeking GCF funding support to work through international organizations accredited with the GCF (such as MDBs, UN agencies, developed country bilateral development agencies or transnational commercial banks) rather than through developing country entities.
National Designated Authority (NDA)A NDA (or focal point) is identified by each country to serve as the core interface between the GCF and the country. The NDA should ensure that activities supported by the GCF align with national priorities to help advance ambitious climate action.
No-objection procedureThe purpose of the no‐objection procedure is to ensure consistency with national climate strategies and plans and country-driven approaches. The no-objection is provided to the GCF by the NDA or focal point, in conjunction with any submission of a funding proposal by an accredited entity of the Fund. In case a proposal is submitted without the no-objection letter, GCF will notify the NDA or focal point and will only submit the proposal to the Board if the no-objection is received within 30 days of the notification. Each country will decide on its own nationally appropriate process for ascertaining no-objection to funding proposals according to the country’s capacities and existing processes and institutions.
Participatory monitoringThe Governing Instrument of the GCF establishes that the use of participatory monitoring involving stakeholders will be encouraged. The current initial monitoring and accountability framework for accredited entities includes first elements to implement this provision. Participatory monitoring and evaluation assesses change through processes that involve many people or groups, each of which is affecting, or is affected by, the changes being assessed. Stakeholders negotiate an agreement about how progress should be measured and how the findings will be acted upon. Participatory monitoring and evaluation draws on the methods and tools of participatory action research.
Private Sector Advisory GroupThe PSAG is an advisory body consisting of eight private sector “experts” - four from developed and four from developing countries - and two civil society members with private sector knowledge. The private sector experts are drawn from banks, insurance institutions, renewable energy companies, and so on. The PSAG makes recommendations to the Board regarding policies that are relevant to the private sector (such as, what does the GCF need to do in order to reach micro-, small- and medium-sized local enterprises in developing countries?). The Board is under no obligation to follow these recommendations, but in practice the PSAG has written policy proposals that the Board considers directly.
Private Sector FacilityThe PSF is a division within the GCF Secretariat that employs staff with expertise in private sector investments and deal-making. It has two primary mandates: (1) to get the private sector to fund the GCF (using ideas such as selling bonds to institutional investors, none of which have yet been approved or are feasible at this time); and (2) to support private sector activities in developing countries, with a special emphasis on micro-, small-, and medium-sized enterprises.
Readiness supportReadiness refers to the capacities required by a country to plan, access, deliver and monitor, report and evaluate climate finance in an effective manner. Such planning can allow a country to ensure the financial support given by the GCF will enable it to meet their climate change priorities and needs.
REDD-plusReducing Emissions from Deforestation and Forest Degradation (REDD) and the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries (REDD-plus) is one of the other vehicle of the multilateral mechanisms under UNFCCC that is essentially dedicated to making financial provisions available to developing countries in their efforts to reduce emissions and removal of greenhouse gases through different forest management strategies.
United Nations Framework Convention on Climate ChangeThe United Nations Framework Convention on Climate Change (UNFCCC) is a global environmental treaty established in 1992 by all Parties to the Convention with the aim of stabilizing the concentration of atmospheric greenhouse gases to a level that will prevent dangerous human interference with the climate system while ensuring sustainable development
Focal pointCountries may appoint a focal point in lieu of an NDA to serve as the primary interface between the country and the GCF. For many countries this is an interim measure until a national designated authority can be established.
National Implementing Entities This term (NIE) does not have a specific meaning in the GCF context, but is generally used to refer to national direct access entities. It is a carry-over term from the Adaptation Fund, which calls its direct access entities NIEs. Note that a country can have any number of direct access entities - countries are not limited to one NIE.
Interim trusteeThe World Bank serves as the GCF’s Interim Trustee, meaning that it holds and disburses the GCF’s money. Currently, the Interim Trustee is a purely administrative function - the World Bank does not have any decision-making power over how GCF money is spent and cannot impose any conditions on that spending. The GCF Board will select a Permanent Trustee (which may or may not be the World Bank) no later than the end of 2017.
MSMEMSME stands for “micro, small and medium-sized enterprises”. It designates the segments of the domestic private sector which is usually primarily associated with domestic service-provision and job-creation. Women entrepreneurs in developing countries are to a much higher percentage represented in MSMEs than in the domestic private sector overall. While there is no universally acknowledged definition of the respective categories, and classifications vary from the manufacture to retail sector or by country or organizations, they usually look at the number of employees and the size of investment in machinery and equipment of the individual enterprise. he GCF has acknowledged MSMEs as a priority focus of its private sector engagement in developing countries and has approved a US$ 200 million MSME Pilot Program.