Amazon Fund Working Paper

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WORKINGPAPER

THEAMAZONFUND:RADICALSIMPLICITYANDBOLDAMBITION

INSIGHTSFORBUILDING

NATIONALINSTITUTIONS

FORLOWCARBONDEVELOPMENT

SimonZadek,MayaForstaterandFernandaPolacow

December2010


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1|TheAmazonFund:radicalsimplicityandboldambition

ThisWorkingPaperwaswritten bySimonZadek,MayaForstaterandFernandaPolacow,with

the support ofFundacin Avina. Itis afollowup toan earlierreportby SimonZadek, Maya

Forstater,FernandaPolacowandJooBoffinoentitledRadicalSimplicityinDesigningNational

ClimateInstitutions:LessonsfromtheAmazonFund(2009).1

IndevelopingthisWorkingPaperwehavedrawnondocumentsandinformationpublishedby

the Amazon Fundand on a series of interviews we conducted with stakeholders andexpert

commentators. Throughout the report quotes drawn from our interviews,as well as from a

series of expert meetings hosted by BNDES in 2009 as part to the Amazon Funds ongoing

development..2

Wearegratefultotheintervieweesfortheirinputsandinsights,theseincluded:TassoReszende

deAzevedoandThaisLinharesJuvenaloftheBrazilianMinistryofEnvironment;ClaudiaCosta

of BNDES, Adriana Ramos of FBOMS / ISA; Carlos Nobre of INPE, Virgilio Viana and Gabriel

RibenboimofAmazonasSustainableFoundation;CaioMagriofETHOS;BrendaBritoofIMAZON;

Mariano Cenamo of Institute for Conservation and Sustainable Development of Amazonas;

Paulo Moutinho of IPAM; Fabio Leite of ARPA Programa Areas Protegidas da Amaznia;

Claudio Flres a technical consultant forthe environment to Par State; LuisMenesesFilho,

REDDConsultanttoAcreStateandotherorganisations;EllenBeckerBruzelliusoftheNorwegian

Forest ClimateInitiative; Inge Nordang of the NorwegianMinistry of Foreign Affairs; Torkjell

LeiraoftheRainforestFoundation;AndreaPontualofFundacinAvina;NickGodfreyandDanielBradley of DFID; Charlie Parker of Global Canopy; Jessica Brown of ODI; Shruti Mehotra of

GlobalWitness;StephanSchwartzmanofEDF;andCharlotteStreckofClimateFocus.Wewould

alsoliketothankTaniaGobenaforthecommunicationssupport.

While each of these interviewees contributed their perspectives, the responsibility for the

analysisandrecommendationsandforanyerrorsrestswiththeauthors.

ThisWorkingPaperisbeingcirculatedfordiscussion,pleasesendcommentsto

[email protected](inEnglish)[email protected](inPortuguese).

ReleasedunderCreativeCommonsShareAlikeLicense.

DownloadtheWorkingPaperfromwww.zadek.net/amazonfund


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TheAmazonFund:radicalsimplicityandboldambition|2

CONTENTS

ExecutiveSummary.........................................................................................3

1.TheAmazonFund........................................................................................5 Anexperimentindevelopinganationalclimatechangefund......................................... 5Designchallengesandinitialsolutions............................................................................. 7TheAmazonFund'stheoryofchange .............................................................................. 92.Learningbydoing ......................................................................................12Earlyexperiences............................................................................................................ 12Challengesandgaps ....................................................................................................... 13Lessonslearnt................................................................................................................. 163.TheFuture.................................................................................................18 CantheAmazonFundmaketreesgrowonmoney?.................................................... 18

ScenariosforthefutureoftheAmazonFund ................................................................ 19Lessonsforothers .......................................................................................................... 22


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EXECUTIVESUMMARY

The Amazon Fund is a crucial early experiment in developing a national climate funding

mechanism.Itoffersanexampleforotherswhoareseekingtodevelopmechanismsthatshift

beyondtraditionalaidmodelstowardsdirectaccesstoclimatefinance.Suchinstitutionsreflectnationalprioritiesandaremorecosteffective,lessbureaucraticandmoreresponsivetolocal

needsandstakeholderconcerns.

TheAmazonFundsdesignisunique. Itsdesigndrewonthemodelandexperienceof private

philanthropic funds and independent conservation trust funds. However, it broke with

conventioninthreekeyways:

PerformanceBased Financing: the Amazon Fund provides simple intermediationbetween performancebased financing (per tonne of carbon emissions avoided) and

projectinvesting.

Restricted MultiStakeholder Governance: a multistakeholder committee involvingfederalandstateofficialsandcivilsocietyrepresentativeswasestablished.However,the

steeringcommitteedoesnotactastheboardoftheFund,givingsignificantautonomyin

practicetotheFundsmanagers.

LowCostLocalManagementbytheNationalDevelopmentBank:theFundismanagedbythenationaldevelopmentbankBNDES,withanagreementtotake3%ofdonationsto

covercosts.

CoretotheAmazonFundsdesignwasadecisiontostartfastandevolve. IftheAmazonFund

hadbeendevelopedthroughatraditionalapproach,theinkwouldnotyetbedryon thefinal

agreeddesign.InsteadtheAmazonFundbeganwithjustenoughstructuretogettheFundfrom

ideato realityandtobringtogethereachofthekeyactorsneededtogetitstarted.Together

they have built up competencies, hosted debates and started to address key gaps and

challenges.

TheAmazonFundstheoryofchangeiscriticaltounderstandinghowtheFundseekstomake

change,howitmakestreesgrowonmoney,whichistheultimatechallengeforanyReduction

inEmissionsfromDeforestationandForestDegradation(REDD)scheme:

Projectsand Implementation: scalingup theimplementationof effective projectsandapproaches, and providing funding to support the implementation of Brazils nationalstrategyforpreventingdeforestation.

Power andPolicies: helping to strengthen and reinforce the political and institutionalforceschampioningsustainabledevelopmentoftheAmazonregioninBrazil.

EconomicPressuresfindingandsupportingcatalyticapproachesthatenablelargescaleeconomictransformationtowardssustainabledevelopmentintheAmazon.

InitsfirstyeartheAmazonFundhasconcentratedonthefirstofthesedrivers.Theimmediate

pressureon theAmazonFund hasbeento setcriteria andrapidlystarttoselectprojectsand

disbursefunds, aswellas toensureanddemonstrate fiduciaryresponsibility.However,ithas

started to face a number of critical design and operational challenges in its governance and


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strategydevelopment,transparencyandmanagementcapacity.

IftheAmazonFundremainsfocusedonlyontheprojectsand implementationleveritwill

have limited impact. Brazils REDD strategy will certainly need to tackle the economic and

politicaldriversofdeforestation.ThequestioniswhethertheAmazonFundcanplayanactive

partinthis,asadriverofinnovation,asahubforlearningandstrategydevelopmentandasa

focalpointforpolicydebateanddevelopment.

CurrentlytheAmazonFundisstuckinthemiddlebetweensimplicityandambition. Weoffer

twopotentialdirectionsinwhichtheAmazonFundmightdevelop:

Simplicity:theAmazonFundremainsasimple,lowcostfundingmechanismwithinabroaderBrazilianREDDsystem.

Ambition: the Amazon Fund develops into a mature and increasingly autonomousinstitution at the heart of Brazils REDD strategy, that is proactive in fundraising and

investment,learningandinfluencingbroadersystems.

ThebestpathwaydependsonthebestbetsoftheAmazonFundstakeholdersthemselves.If

theAmazonFundstakeholdersseeitasthebestvehiclefordevelopingandinfluencingBrazils

strategicdirectionfortheAmazon,andinvesttheirtime,resourcesandefforts,theycouldmake

itso.Butiftheybelievethatthesedecisionsarebetterservedbyotherforumstheymaydecide

to keep the Amazon Fund as a streamlined and simple accounting mechanism, and cascade

moredetailedfundingdecisionstootherfunds,states,municipalitiesandcivilsocietyconsortia.

AkeystrengthoftheAmazonFundistheinvolvementofeconomic,politicalandcivilsociety

actors. Ultimately to achieve sustainability, climate funding must succeed in shifting the

economyto oneinwhichlowcarbon industriesaremorecompetitive,and thiswouldinvolvereal shifts for all of these actors. It is therefore important that the Amazon Fund and its

stakeholderscontinuetolearnanddeveloptheFundanditsgovernance,tomeetthechallenge

ithasbeenset.

TheAmazonFundsexperiencehighlights theneed todevelopnational climateinstitutions

thataretrulydevelopmentalandabletocatalyselowcarbondevelopment,notsimplyactas

accountantforclimatefinance.Suchfunds,includingtheAmazonFund,needtoconsiderhow

theywilladdressthethreetheoriesofchangeandwhethertheyhavetherightgovernance

and management to do this. Are they designed and incentivized to take entrepreneurial

decisions,andleverageprivateinvestmenttodrivevaluecreationforlowcarbondevelopment?Cantheycontributetopolicydevelopmentandimplementationinareaswheretherearehuge

vestedinterestsinthestatusquo?

TheAmazonFundsstartfastandevolvemodeloffersapotentapproachtobegintoanswer

these questions in practice. The success of the startfast and evolve model depends on

ensuringthattheinstitutioncreatedisabletolearnandadapt.Oneveryclearlessonfromthe

AmazonFundisthatongoinglearningcyclesofreview,reflectionanddesignevolutionshould

also bebuiltintothe processof institutionaldevelopmentof emergent national directaccess

institutions.


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1.THEAMAZONFUND

InDecember2008,BrazilianPresidentLuizIncioLuladaSilvaannouncedBrazilscommitment

to reduce Amazon deforestation80% below itshistoric baseline over the nextten years. To

supportthisgoal,BrazilcreatedtheAmazonFund,supportedbyaninitialpledgeofUS$1billionfromthegovernmentofNorway.TheAmazonFundsoughttoinvestthesefundsnotonlyinlaw

enforcementand theprotection offorest reserves butin thelowcarbondevelopmentof the

Amazonregion,andtousethemtodemonstrateeffectivenessandattractadditionalfunding.

ANEXPERIMENTINDEVELOPINGANATIONALCLIMATECHANGEFUND

Beyond the Amazon, the attention of those concerned with addressing climate change has

increasingly broadened from thenegotiationof theglobal climatefinance architecture tothe

development of the national direct access institutions needed to steward finances on theground.

3 These direct access institutions areneeded as thelink between theglobal financial

architecture andthe financingof nationalpoliciesand programs. Tosupportsystemicchange

towards low carbon development these institutions will need to deliver on several fronts:

fiduciary responsibility; social and environmental safeguards alignment to development

priorities; verifiable performance; cost effective management; responsiveness to local

stakeholders;andtheabilitytoinfluencethedriversofprivateinvestmenttowardslowcarbon

development.4

Designers of national climate funding institutions can learn from the experience of existing

mechanismsofdevelopmentaidsuchasbudgetsupport,challengefundsandtrustfunds,and

theprinciplesofeffectivedevelopmentaid;ownership,alignment,harmonization,managingfor

resultsandmutualaccountability.5Theywillalsoneedtobuildon60yearsoflearningonwhat

has and has not worked in traditional aid funding, and will need to be based on different

principlesofaccountabilityandmechanismsofoperation.6Alongsideotherinnovationssuchas

the National Implementing Entities accredited by the UNFCCC Adaptation Fund, the Amazon

Fundissignificantasanearlyworkingexperimentofsuchanationaldirectaccessfund.7

The Amazon Fund is unique, and in many ways uniquely Brazilian, as it was designed as a

practical demonstration of Brazils proposal for how forests should be included in the

international climate architecture, and drew on a particular set of national institutions.

However,itoffersusefulparallelsforothernationalclimatefundingentitiesthatarecurrently

being designed.All areseekingto shift beyond bilateral andmultilateral aidmodelstowards

directaccess institutions that reflect national priorities and are more cost effective, less

bureaucraticandmoreresponsivetolocalneedsandstakeholderconcerns.

The emerging institutional landscape of approaches to managing national climate funds

includes:

Existingconservation trust funds which areprivate, legallyindependent grantmakinginstitutions that provide sustainable financing for biodiversity conservation and often

financepartofthelongtermmanagementcostsofacountrysprotectedareasystem.

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These are likely to be drawn into receiving and managing climate funding linked to

forestryandlanduse.9

Newly setup multidonor climatechange funds such as the Bangladesh MultiDonorTrustFund,CongoBasinForestFundandCambodiaClimateChangeTrustFundsetup

with donor involvement in governance, and offshore management by international

agenciessuchastheUNDP,WorldBankandADB.

Nationalfundsandgovernmentimplementingentities suchasthoseappointedbytheAdaptation Fund Board. They are under sovereign control, but do not include multi

stakeholdercoordinationoroversight.

Exhibit 1 illustrates where the Amazon Fund has positioned itself on the spectrum between

government andbroader stakeholder governance, and between donor and recipient country

control. As Exhibit 1 highlights, it is an experiment seeking to develop and demonstrate an

institutionalmodelforclimatefundingthatisinthetargetzoneofstakeholderresponsiveness

andnationalcontrol.

Exhibit1. Fundingmechanismsandalignmenttostakeholders

TheexperienceoftheAmazonFundwillbeusefulforabroadsetofnationalclimatefinance

institutionsthat areseekingto moveintothetarget zone ofnationalcontrol andstakeholder

responsiveness.Forexample,conservationtrustfundswillneedtodevelopcarbonlinkedpay

forperformance systems if they seek to become climate finance mechanisms, offshore

managedmultidonor climatechangefundswillneedto developlocalgovernance inorderto

transition into independent national mechanisms over time, while national funds and

government implementing entities are already coming under calls to review and strengthen

proceduresforcommunityandcivilsocietyengagement.10

LessonsfromtheAmazonFundwillofcoursebeparticularlyrelevanttotheinstitutionsthatwill


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manage Brazils eventual programme forReducing Emissions from Deforestation andForest

Degradation(REDD)scheme.TheAmazonFundshouldnotbeviewedasBrazilsnationalREDD

scheme but as a first incarnation of it. The Brazilian Ministry of Environment is currently

coordinatingapoliticalprocesstodiscussanddraftaninitialproposaltoimplementafullREDD

systeminBrazil.Thisislookingattheinstitutionalframework,theprinciplesforbenefitsharing,

safeguardsandthefinancialmechanismsforraisingfunds.BrazilsfinalREDDschemewillneed

to address the need for financial support for forest conservation beyond the ten year

deforestationreductionperiodcoveredbytheAmazonFund.It willalsohavetoreconcilethe

desireofthefederalgovernmentforanationalschemeoutsideofthecarbonmarketsandthe

advocacyanddevelopmentofstateschemesthatgeneratecarboncredits.And,itshouldalso

needtolinkintoanyfinallyagreedUNFCCCframework.11

DESIGNCHALLENGESANDINITIALSOLUTIONS

The Amazon Fund was developed and

operationalized very quickly. Its design drew

on the model and experience of private

philanthropic funds, independent conservation

trustfundsandPilotProgramfortheProtection

oftheTropicalForestsofBrazil(PPG7).12

Italso

drew on existing underpinnings, such as the

satellitebaseddeforestationmonitoringsystem

providedbythe BrazilianNational Institutefor

Space Research (INPE), and an established

nationalpolicyframeworkforprotectionoftheAmazon.

However,itbrokewithconventioninthreekeyways:

PerformanceBased Financing: the Amazon Fund provides simple intermediationbetween performancebased financing (per tonne of carbon emissions avoided) and

project investing. International funds are secured, uniquely to date, on the basis of

emission reductions demonstrably achieved, drawing on credible monitoring data,

acceptablebaselines,andafixedandmutuallyacceptablecarbonprice.

Restricted MultiStakeholder Governance: a multistakeholder committee involvingfederal and state officials and civil society representatives was established to set the

Fundscriteriaandattesttotheirapplication.However,thesteeringcommitteedoesnot

act as the board of the Fund, giving significant autonomy in practice to the Funds

managers.

LowCostLocalManagementbytheNationalDevelopmentBank:theFundismanagedbythenationaldevelopmentbankBNDES,withanagreementtotake3%ofdonationsto

cover costs. This is supported by a businessmodel oflowcost, rapid decisionmaking,

simplereportingarrangementsandafixedcarbonprice.

Itisincrediblehowquicktheyhavebeenin

acountrythatisknownforitsslow

processes.Theyareshowinggreatefficiency

inbuildingtheFundandachievingtheiraims

ofdeliveringfundingontheground.


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Exhibit2. HowdoestheAmazonFundwork?

Funding Governanceof

strategyand

funding

decisions

Strategic

guidanceand

oversight

Fund

management

Fundingcriteria

TheAmazonFundworks

through:

Donationlinkedtoperformance

GoverningbodyofBNDES

Multistakeholdersteering

committee

(COFA)

BNDESnationaldevelopment

Bank

Policycoherentthematic

fundingareas

agreedbyCOFA

Builton

foundations:

INPEssatellite

basedforest

monitoring

system

Norwaysfew

strings

donationand

trustinBNDES

Earlyleadership,

activecivilsociety

andincreasing

politicalsupport

BNDESexisting

processesand

competencies

Nationalpolicy

frameworkfor

protectionof

theAmazon

Workslikea: Multidonor

trustfund

BN DESsubfund Nat ionalfund BNDESsubfund Conservat ion

trustfund

Key

innovations:

Performance

basedfinancing

Restrictedmultisectorgovernance Lowcost

management

TheAmazonFundoffersatestofasetofdesignsolutionstoaddresseachofthekeycriteriafor

nationalclimatefunds:

Fiduciaryresponsibility:managementof theFundis mandatedto BNDES,theBrazilianNationalDevelopment,a bank that hasa strongtrackrecordof financialmanagement.

NorwayhasalsoreservedtherighttowithholddisbursementsiftheFunddepartsfrom

itsgoals andobjectives,if it fails to submit reports andaudits,or if it is mismanaged

financially.TheFundisexternallyaudited,withtheauditreportpublishedannually.

Social and environmental safeguards: the Amazon Fund is subject to the social andenvironmentalsafeguardsofBNDESoverallinvestmentsandinaddition,includesspecific

investmentcriteriarelatedtofreepriorandinformedconsentoflocalpeople.However,

these are not included in the donor agreement. The Amazon Fund does not have a

specificgrievancemechanism.

Alignment to development priorities: the investment criteria are aligned to theguidelines of the Governments Sustainable Amazon Plan, the Programfor Prevention

and Combating Deforestation in the Amazon and state plans for protection of the

Amazon.

Payforperformance:theAmazonFundoperatesonadonationbasis,raisingmoneyasarewardforcutsindeforestationlevelsalreadyachievedinthepreviousyear,measured

against a 10year average baseline, revised down every five years. INPE monitors

performanceusingdetailedsatelliteimagery.Thecalculationofthiscarbonperformance

measureissignedoffbyaTechnicalCommitteemadeupofkeyscientificexpertsinthe

field.

Costeffectivemanagement:insettinguptheAmazonFundthegovernmentmandatedBNDEStoretain3%ofeachdonationtocovermanagementcosts.Thisisextremelycost

competitivecomparedtootherfunds.Forexample,theWorldBanktypicallyretains10


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ofBrazilsnationalstrategyforpreventingdeforestation.

PowerandPolicies:theAmazonFundwascreatedtorewardandsignalsupportfromtheinternational community for Brazils policies to cut deforestation. The Amazon Fund

achieves change by helping to strengthen and reinforce the political and institutional

forceschampioningtheAmazoninBrazil.

Economic Pressures: the Amazon Fund offers an opportunity to direct internationalresourcestowardscatalyticapproachesthatenablelargescaleeconomictransformation

towardssustainabledevelopmentintheAmazon.Thesethreemechanismsareofcourse

notexclusive,butrathermutuallyreinforcing.

Exhibit3. TheAmazonFundstheoryofchange

Theprojects andimplementation theory of change isthe

primary operating mechanism of the Fund; selecting

projects that are in line with national policy priorities for

avoiding deforestation. This includes building capacity to

implement national policies for land registration, legal

enforcementanddevelopmentofprotectedareas.

However,manyof thestakeholdersofthe Fundwereclear

WiththeFund,Braziliansociety

hasinitshandaunique

opportunitytoreduceemissions

thatcanbefinancially

compensated.Butwhileitdoes

notbecomeapoliticalpriority,

wecanendupmissingthisopportunity.


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about thelimitationsof this approach,followingtheexperienceof yearsof donor fundingfor

Amazon projects and capacity building through programs such as the World Bank managed

PPPG7.TheyhighlightedthatappropriateandeffectiveactionintheAmazon,mustbebasedon

aclearunderstandingofeconomicandpoliticalforcesdrivingdeforestation.

Infact,theAmazonFundisnotsimplyamechanismforfundingprojects,buthaskeydesign

featuresaimedatpullingthepoliticalandeconomicleversforchange.

PowerandPolicies:Norwayslarge,longandfewstringsdonationwasintendedtodeliver

real and symbolic support to policymakers,

officialsandactivistsworkingtodevelopand

implementpolicies to value theAmazon and

decrease deforestation. The Funds steering

committee brings together federal

government agencies, states andcivilsociety

whichoffersthepotentialtolinkbacklearning

fromitsinvestments,intopolicydebates,and

vice versa. One direct mechanism for this is

that theFundsrulesrequirestatestodevelop astrategytofightdeforestation,before

theycanparticipateintheAmazonFundgovernance,andapplyforfunding.

EconomicPressures:thevisionforeconomictransformation is expressed in the Amazon

Funds objective to make the forest more

valuablethanthealternativeuseoftheland.

This is also frequently highlighted by many

members of the COFA and the technical

committee, aswell as in theAmazonFunds

public communications. At least half of the

Amazon Funds investments are intended to

go towards the innovation focused areas of

research and sustainable enterprise

development. The decision to make BNDEStheimplementingagencyfortheAmazonFundwasacombinationofadesiretohavea

competent national institutionmanagingthe fund, andtherecognitionthatasa major

playerinBrazilsdevelopment,thebankitselfhadtobecomepartofthesolution.BNDES

investsinindustriessuchasagriculture,meatpacking,damsandinfrastructurethatare

partofthedeforestationcycle.ManyoftheAmazonFundsstakeholdershaveexpressed

thehopethatengagingBNDESasthemanageroftheFund,wouldenablethebankto

build its own understanding of how its own investment practices can impact on

deforestation.

ThedangeristhattheAmazon

FundwillbelikethePilot

ProgramforProtectionofthe

Amazon.Itwassuccessfulin

movingmoneyandsupporting

projects,butintheenditdidnt

adduptoanything.Youhave

spentallthemoneyandareleft

withnothing.

TheentranceoftheBNDESintothe

Amazonandtotheenvironmentalissue

isofhistoricalimportance.Forquite

sometimenow,manyofushavebeen

callingfortheBanktobemoreinvolved

inthisarea.Ibelievethattheinclusion

oftheAmazonintheportfolioofthe

Bankisofhistoricalmagnitudeand,in

myview,goesbeyondtheconstitution

oftheAmazonFund.


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2.LEARNINGBYDOING

EARLYEXPERIENCES

InitsfirstyeartheimmediatepressureontheAmazonFundhasbeentosetcriteriaandrapidlystart to select projects and disburse funds, as well as to ensure and demonstrate fiduciary

responsibility.EightprojectsworthUS$60million have beenapprovedto date,the initialfive

projects announced atCopenhagenwere largelyfromNGOs,but laterprojects have included

statesandamunicipality.

Onedangereverpresentinthediscussionofclimate

finance and forest frontiers is that funding

mechanisms could fail through corruption and

mismanagement.TheAmazonFundappearstohave

avoidedthisfirsthurdle, althoughitislikelytoneedtostrengthenitsdemonstrationoftransparencyand

fiduciary responsibility to attract a wider range of

donors.Thesteeringcommitteehasrecentlysigned

off on the Amazon Funds first annual report,

indicatingthatthegovernment,stateandcivilsociety

participantsaresatisfiedwiththeauditandthatthe

FundsallocationshavebeeninlinewithgovernmentpolicyandtheFundsguidelines.

While the Amazon Fund has been able to get started relatively quickly, compared to other

funds,theactualrateatwhichmoneyisbeinginvestedonthegroundismuchslowerthanthe

rate that it is being earnedthrough reductions in deforestation within the agreement with

Norway.ThereforeBNDESskeypriorityhasbeentorampupdisbursementrateandcapacity.

Wehadagoodexperienceapplying

totheFund,theprocesswasless

bureaucraticandfasterthanthe

WorldBank.Thecontractingstageis

verytoughthough,astheydont

reallyunderstandhowNGOswork,

andalltheformsarethesametype

thattheyuseforcommercialloans.


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CHALLENGESANDGAPS

As the Amazon Fund has sought to mature its operations, a number of critical design and

operationalchallengeshavesurfaced:

Exhibit4. DesignandoperationalchallengesintheAmazonFundssecondphase

Projectfundinggap.BNDEScomplainsofalackofhighqualityfundableprojects,whileexternalstakeholdersandsomeCOFAmemberscomplainofnarrowoperationalcriteria,

lackofcommunicationandrigidproceduresmakingitdifficulttoaccessfunding.The

Fundstartedoutbyusingthesameapplicationforms,fundingproceduresandemployee

competencysetsfortheAmazonFundasBNDESdoesforitscommercial,industrialand

infrastructureloans.Therehavebeenconcernsthattheapplicationproceduresarenot

clear or appropriate, and this is believed to have been a factor preventing some

organisationsfromapplyingorleadingthemtomakeincompleteapplications.Thereare

also concerns that BNDES staff lack specific competency in assessing environmental

projectsandsustainabledevelopmentissuessuchasgenderequityandtherightsof

indigenouspeople.

Ambition gap. Norways initial donation of US$110 million a year was followed by asmaller donation from Germany, but there have been no additional donations to the

Fund. The Brazilian government has stated that it needs US$1 billion a year of


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international contributionsto fully implement itsmediumtermplansfor protection of

theAmazon.BNDEShasamandatetoraisefundsthroughtheAmazonFundmechanism,

butithasnotpursuedthisyet.IndeedrecentfundingraisedbyBrazilsuchasthrough

thedebtfornatureswapwiththeUSandthroughitsownoilproductionlevyhavenot

beenchanelledthroughtotheFund.

Governance gap. The multistakeholdercommittee and the Technical Committee

werecriticaltothesettingupoftheAmazon

Fund,providinglegitimacyandassurancethat

the Fund was not a donorled or federal

government program, that it would be

responsivetostakeholders,andthatitwould

notbecapturedbynarrowinterestsorshort

termpoliticalpressures.Howeveratpresent,

the ongoing role of the committee remains

ambiguous;itisgenerallyperceivedashaving

more influence and oversight of BNDESs

managementoftheAmazonFundthanitdoes

in practice. Civil society COFA members are

frustrated by the difficulty of influencing

BNDESs operational procedures. The

Technical Committee members also feel

underused,astheyarenotabletocontribute

to the ongoing development of investmentstrategy,andarelimitedtosigningoffonthe

endofyearcalculation.

Strategygap.TheAmazonFundwasineffectlaunchedasaREDDfund,inadvanceofBrazil

developing a REDD strategy. The criteria

developed provides basic guidance as to the

themes and activities that should be funded

including requirement for coherence with

nationalandstateplans,andanaimtotarget50%offundingtowardsscientificresearchand

innovation in sustainable economic activity in the Amazon. However, in its early

operations BNDES has tended to apply its criteria as a filter, rather than as a set of

strategicpriorities,seekingtoidentifyprojectsthatareabletosatisfytheadministrative

hurdlestoallowtheFundtobegintomakegrants.Todate,theAmazonFundhasnot

metits ambitionto target over half of fundingtowards innovation,but hastendedto

fundtraditionalcommandandcontrolmeasures.Ithasalsonotfoundawaytogetits

funds to grassroots organisationssuch as associations of rubber tappers,smallholders

andindigenouspeople.

TransparencyGap.AswithotheroperationalpracticestheAmazonFundstartedoutby

Theapplicationcriteriaare

narrow.Theydontdealwiththe

driversofdeforestation.In

particulardontdealwiththe

agriculturesector

TheTechnicalCommitteeismadeup

ofpeoplewithvasttechnicaland

scientificknowledge.Theirroleisto

validatethecarbonreduction

numbers,butthecalculationis

amazinglysimpleandsothe

Committeeisnotreallynecessary.It

isawasteofeverybodystime.It

couldbeusedtoassistincommissioningresearchandstudies

andadvisingonstrategy.

TheAmazonFunddoesnothave

acommitteethatthinks

strategicallyaboutdevelopment

intheAmazon,orabout

innovation.COFAisnotreallythe

placethatthisishappening;it

doesnothavethisstrategic

mediumtolongtermapproachto

thedevelopmentoftheAmazon.


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applyingstandardBNDESprocessesto its

levels of transparency. Transparency of

BNDES has long been a concern of civil

societyorganisationsinBrazil.In2009was

thefirsttimethatBNDESpublishedalist

ofprojectscontracted.AtfirstBNDESwas

not willing to publish details of projects

submitted, as well as those funded. Civil

societyorganisationsintheAmazonFund

steeringcommitteeshavesoughtagreaterdegreeoftransparencyfromBNDESoverthe

applicationsthathavebeenreceivedandtheprojectsthathavebeenfunded,andthere

has been some movement in this area with BNDES now publishing details of project

applicationsreceivedandbeingprocessed(althoughthisinformationisonlyavailablein

Portuguese).ThereisalsolittletransparencyabouttheBankssocialsafeguards,andthe

Amazon Fund lacks a specific grievance mechanism. Updates on the Amazon Fund

websitehavebeenfew(andoftenonlyavailableinPortuguese)andtherehasbeenalow

levelofengagementwiththemedia.

Capacity gap. In general the cost differential between national institutions andinternational organisations in managing climate finance has been stated in terms of

lower staff costs, and reduction in expenses of international flights and offices.15

However an initial assessment of BNDES suggests that this is not the only factor

underpinning BNDES lowcost structure in managing the Amazon Fund. In 2010 the

AmazonFundhadnine(andnowhas21)membersofstaffmanagingacurrentannual

budgetofUS$110milliondollarsgivingafigureof0.08peoplepermillion.16

ThisisinlinewiththelevelofBNDESstaffing,butbenchmarkedagainstotherfundssuggeststhat

the Amazon Fund may be understaffed to manage the throughput of the Norwegian

donation, or to ramp up fundraising and spending.17

The Fund has now increased its

staffing levelsbut thecentralisednaturemeansthatstaffarelimited intheirabilityto

visitAmazonstates ona regularbasis, andsuccessful fundingbidshaveofteninvolved

granteesmakingmultipletripstoBNDESinRiodeJaneiro.Whiletherehavebeensome

roadshows intheAmazon, theFunddoesnothavea localpresence,andinterviewees

indicated that awareness and understanding of the Fund amongst local stakeholders

remainslow.Successfulbiddershavebeenaskedbyotherstoexplainandguidethem

through the application, indicating a need for more local capacity building and

communication.

Itisaninnovativemechanism.Butit

seemsnontransparentfroman

outsidersperspective.Thereisnot

muchinformationabouttheFunds

projects,itsdevelopments,itsguidelines,itsstrategicviewand

approaches.Wedontknowaboutits

compliancemechanismsforexample.


17/28


LESSONSLEARNT

The start fast and evolve model enables

climateinstitutions todevelop inreadiness for

funding flows. If the Amazon Fund had been

developed through a normal approach, the ink

wouldnotyetbedryonthefinalagreeddesign.

Instead the Amazon Fund began with just

enough structure toget the Fund from idea to

reality and to bring together each of the key

actorsneededtogetitstarted.BNDEShasbuiltupcompetencies,andtogetherwiththeCOFA

arestartingtopursueactionstoaddresssomeofthegapsidentified:

Evolving funding processes to ensure they are clear, well designed and accessible,includingdevelopingafundingstreamandprocessforsmallerorganisations.

Improving transparency and communications about the Amazon Fund both on theinternetandthroughgranteeandfunderroadshows.BNDESnowreportsonproject

proposals received, their place in the pipeline, andthose that have beenfunded on

theirwebsiteandhasbeguntopublishkeydocumentsinEnglish.

Refining the focus andarticulationof thesegments andactivities theAmazon FundinvestsinBNDESconvenedthreedaylongmeetingswithspecialistsinthesectorandthe

Amazonregiontodiscusstheopportunities,challengesandsolutionstodevelopmentin

theAmazon.Theseproceedingswerepublishedandalsofedintothedevelopmentofa

resultsmatrix(logicalframework)fortheFund.BNDESwillcontinuetorefinetheresults

frameworkasitbuildsupexperienceformanalysingandmonitoringprojects.

The success of the startfast and evolve;model depends on ensuring that the institution

created is able to learn, adapt and evolve. Otherwise it may become stuck within its

shortcomings.BoththeBNDES,andtheAmazonFundstakeholdersperhapsunderestimatedat

theoutset,the challengesof onthe onehandbuilding thespecificcapacities thebankwould

need, and on the other, of challenging its

established practices. During the design of the

AmazonFund,nomechanismswereputinplace

to ensure that BNDESs operational procedures

metthespecificneedsforeffectiveinvestmentin

deforestation reduction in Amazon. Without an

operations manual of key expectations,

processes and principles at the outset these

elements have had to be negotiated and

developedastheFundhasevolved.Inthefaceof

an organisation with a strong culture and

establishedwaysof doing things,theimperative

Thisisanewmechanism.Thereareproblemsinstartingupabiginitiative.It

iseasytogetfrustrated.Buteverything

hashadtobedevelopedandnegotiated

astheywentalong.Thisispartofwhat

happenswhenyoubringinalotof

stakeholders.

RightnowtheAmazonFundisstillthe

bestREDDmechanismontheplanet,asit

isafinancialmechanismcapableof

reducingemissions.Itservesusasareal

learningmechanismtothegovernment,

toBNDESandtosocietyasawholein

howoneshoulddealwithREDD.Itisa

goodinstitutionbuthasfundamental

problemsthatneedtochange,especially

speedingupitsdisbursements,enabling

smallorganisationsandimproving

transparencyatBNDES.


18/28


ofgetting the Fund off the ground quickly, this has been anarduous processand has taken

muchofthesteeringcommitteesattention.

Anadoptabletoolkitof standards,processes,policies,and competenciescouldbe usefulin

acceleratingtheinitiallearningcurve.TheconfidenceinBNDEStotakeonmanagementofthe

Amazon Fund was crucial to its rapid development. While the Amazon Funds civil society

participantsand their broadernetworks areoften

strong critics of the Bank, they also hoped that

placing the Amazon Fund within the bank would

enable broaderengagementand capacity building

to understand and address the drivers of

deforestation within its conventional investment

portfolio. In theprocess oftakingon theAmazon

Fund, BNDES has strengthened its Environmental

Division, and bank personnel have gained

experience and knowledge through engagement

with the COFA and through technical assistance

fromNORADandGTZ,andinputsbytheBrazilian

Forest Service, Ministry of Environment and the

Brazilian Institute of Geography and Statistics in

developingtheirimpactsframework.

A simple financing mechanismmaynotbe enough. Atpresentthe Amazon Fund isnot an

institution with a strategy, budget and targets. It is a simple, lowcost financing mechanism

housed within a strong and powerful institution. However its goals, and the hopes and

expectationsofitsstakeholdersarehugelyambitious.Inordertomaketreesgrowonmoney

the Amazon Fund seeks to provide sufficient funding to enable capacity building and

implementationofBrazilsnationalstrategyforpreventingdeforestation,byfederalagencies,

states,municipalitiesandcivilsociety.Italsoseekstoidentifyandscaleupnewapproachesto

sustainable development in the Amazon, to the point where they influence the economic

driversofdeforestation.Theemergingfunding,strategy,capacityandgovernancegapsindicate

that the Amazon Fund is likely to have to either develop beyond its initialsimple,financing

mechanism,orrevisedowntheseambitions.

TheMinistryoftheEnvironmenthas

brokenabarrierwithinthegovernment

whichpreventedtheinclusionofforestsin

thediscussiononclimatechange.With

that,itmanagedtoleveragetheideaof

creatingafundfortheAmazon.Welivein

asituationofpoliticalconflictbetween

differentareasofgovernment,withno

prospectofsolution.Tosurpassthese

barriersintheenvironmentalareaand

moveintootherareasisessential.


19/28


3.THEFUTURE

CANTHEAMAZONFUNDMAKETREESGROWONMONEY?

It is of course too early to evaluate the AmazonFunds impacts but it is clear from the current

focus of BNDES, and of discussions at the COFA,

that the Amazon Fund is focused on building its

capacity,fundingstrategyandpipelineofprojects,

to deliver through the first theory of change

projects and implementation ramping up its

abilitytodisbursefundingtoagreaternumberof

projects,andcoordinatingtransfersoffundingtotheAmazonregion.Overcomingoperational

challengesinordertorampupdisbursementsinthiswaywillbecrucialtotheAmazonFundas

ittransitionsfromitsearlystartupphasetoafullyfledgedandoperationalfund.

BNDES has hosted discussions amongst Amazon

stakeholders and experts on the drivers and

solutionstodeforestation.Thesehaveemphasised

the political and economic dimensions of the

problem. The lessons of the Pilot Program to

ConservetheBrazilianRainforestarethatfunding

a basket of projects is not enough to achieve

lasting change. Indirectly supporting policy

development by building the constituency of Brazilian politicians, officials, NGOs and

professionals in favour of green environmental policies, is slow and unpredictable.18

As a

national institution the Amazon Fundhas the potential to do more to influence powerand

policies.The Fund is already credited with having influence on BNDESs broader investment policies,

which help to drive economic pressures. The Bank has recently launched a 1 billion Reais

(US$588million)fundtofinanceprojectstoreducegreenhousegasemissionsassociatedwith

agriculture. It has also established more rigorous lending criteria for ranchers and farmers,

requiring traceability by meatpackers to ensure cattle production does not result in

deforestation.

BrazilsREDDstrategywillcertainlyneedtotacklethe

economicandpoliticaldriversofdeforestation.The

questioniswhethertheAmazonFundcanplayan

activepartinthis,asadriverofinnovation,asahubfor

learningandstrategydevelopmentandasafocalpoint

forpolicydebateanddevelopment.Alternativelyit

maybecomeasimpleaccountingmechanismabank

accountandfundraisingsystemattheinterfacebetweenBrazilsnationalpolicydevelopment

andimplementationandtheinternationalclimatefinancesystem.

TheFundisthecountrys

bettodealwithinternational

moneyandsoitshouldbe

morecreativeanddynamic.

Thereisagreatlackofharmony

betweentheenvironmentalareaand

otherareasinthegovernment,

whichcallsintoquestiontheissueof

thecountryscredibilitytocontinue

receivingthesedonations.

ThefirstcentralideaoftheAmazon

Fundshouldbetoinitiateaneffort

tomakeresourceallocationmore

systematicandefficient.


20/28


21/28


Simplicity:theAmazonFundremainsasubfundofBNDESandoperatesasasimple,lowcostfundingmechanismwithinabroaderBrazilianREDDsystem.TheAmazonFundsrole

wouldbetoaccountforfundingandforestcarbonflows,insupportofawelldefinedand

ambitiousnationalstrategy.Atitscorewouldbethesimpleformulaofdollarspertonne

and tones per hectare. Strategy development, capacity development, influence and

learningcarriedonbyotherpartsofthesystem.

Ambition: the Amazon Fund develops into a mature and increasingly autonomousinstitution at the heart of Brazils REDD strategy, that is proactive in fundraising and

investment, learning and influencing broader systems. The Amazon Fund develops a

visionandstrategythatisnotonlystewardedandsupportedbyitsstakeholdersbutone

thatinvolvesthemandwillultimatelyshifttheirinvestmentdecisions.

Exhibit5. ThreescenariosfortheAmazonFund

Simplicity Stuckinthemiddle Ambition

Awardgrantstobroader

networkintermediary

organisationsforcapacity

building,programmesand

smallgrantgiving

Projectfundinggap:Unable to identify

enough highquality fundable proposals

using current criteria and funding

mechanisms

Developspecialist

fundingcompetency,

andcatalysethe

developmentregional

andthematic

programmes

Remainasasimple

mechanism,passively

collectingandaccounting

forfundsdonated

throughinter

governmentalagreements

Ambition gap: Lack of proactive

fundraising strategy to close the gap

between current funding and overall

need

Investinmanagement,

fundraising,

communication,and

capacitybuildingtogo

beyondinitialfunds

secured

RemainasaBNDESsub

fundwithlimited

stakeholderroles.

Stakeholderengagement

onREDDstrategywould

takeplaceseparatelyat

nationallevel,andinlocal

processes

Governance gap: Frustration amongst

stakeholdersinvolvedingovernance

Developintoan

autonomousinstitution

withBNDESproviding

secretariat

Seekgreaterguidance

fromnationalandstate

REDDstrategiesto

prioritisefunding

Strategy gap: Lack of a strategy for

prioritising investments and reaching

ambitiousimpacts

Developasamature

organisationwitha

strategyandtargetsfor

funding,influenceand

impacts,including

engagementwith

economicactors

Maintainlow3%direct

administrationcosts

Capacity gap: Calls for more involved

processes for communication, capacity

building, small organisations conflict

withlowoperatingcosts

Providetransparent

analysisofcosts

neededtoupscale

impacts

Transparencygap:WhicheverwaytheAmazonFunddevelops,transparencywillbecrucial.


22/28


Whichever track the Amazon Fund goes down

there will be risks and dangers. In part the best

pathwaydependsonthebestbetsoftheAmazon

Fundstakeholdersthemselves.IftheAmazonFund

stakeholderssee itas thebestcurrentlyavailable

vehicle for developing and influencing Brazils

strategicdirection for avoidingdeforestation, and

investtheirtime,resourcesandeffortstheycould

makeitso.

Butiftheybelievethatthesedecisionsarebetter

served by other forums they maydecideto keep

the Amazon Fund as a streamlined and simple

accountingmechanism,andcascademoredetailed

funding decisions to other funds, states,

municipalities and civil society consortia. But

continuing to try to navigate a middle course is

perhapsthemostdangerousrouteofall.

At present the Amazon Fund sometimes faces

criticismforitsparadoxesitis,ironicallyfunded

by the proceeds of oil , managed by a major

investor in infrastructure,agricultureand mining,

andgovernedinpartbyfederalandstateagencies

whose sustainable development policies still sit

alongsideanextractiveeconomymodel.However

itisthisinvolvementwitheachoftheseeconomic

andpoliticalactorsthatmaybeitsmostimportant

strength.

Ultimately,toachievesustainability,climatefundingmustsucceedinshiftingtheeconomyto

oneinwhichlowcarbonindustriesaremorecompetitive,andthiswouldinvolverealshiftsfor

alloftheseactors,andforthebroaderprivatesector.

Thereisnonationalprojectforthe

Amazon.Brazildoesnotevenknowifit

shouldmakealargegroupofnational

parksoutoftheAmazon,orahuge

soybeanplantation,ormaybeboth.

Unlessweestablishthisvisionwecannot

solvetheissues.Thinkingpracticallyit

wouldbeimportantifBNDESwasto

createanucleusforstrategicthought:a

forum,aspacetocreatethisnational

project.Brazilwillonlytacklethe

Amazonissuewhenwecreateanational

projectfortheregion.

ThefutureofBNDESandBrazil,from

thestandpointofitsdevelopmentand

itspositionintheworld,willbe

decidedinafiercecompetition,which

requiresvaststrategicforesight,

becausethenewparametershavenot

yetbeengivenaprice.Thenameof

thegameissustainable

development.Thisisthefutureof

BNDES;thisisthefutureofbusiness.

Thisisnotanitemonanagenda,but

onethatwilldecidewhatBrazilwillbe

liketomorrow.


23/28


LESSONSFOROTHERS

Forthosedevelopingclimatefundinginstitutionsinothercountries,theAmazonFundsstartfastandevolvemodeloffersapotentapproachtobreakthroughthedeadlockofinternational

negotiatingparalysis,andbegintobuildupinstitutionalcapacity.

AsExhibit6highlights,manycountriesaresettingupinstitutionsthatparalleltheAmazonFund.

However,ithasbeennotedthatdespitetheUNFCCCAdaptationFundsprovisionforNational

DirectAccessinstitutions,manycountriesarefallingbackontraditionalmultilateralagenciesto

managetheiradaptationfinance.19

Thisrepresentsalostopportunitytobegintobuildupthe

institutionalcapacityandlearningneededtoeffectivelymanagethesefundstowardsnational

priorities.

Oneofthemostimportantcriteriaintheinstitutionaldesignandselectionoftheseinstitutions

should be the ability to learn and evolve, and to support stakeholder engagement to drive

strategydevelopment.TheAmazonFundsexperiencehighlightstheneedforongoinglearning

cycles of review, reflection and design evolution to be built into the process of institutional

developmentofemergentnationaldirectaccessinstitutions

Such funds, including the Amazon Fund, need to consider how they will address the three

theoriesofchangeandwhethertheyhavetherightgovernanceandmanagementtodothis.

Aretheydesignedandincentivizedtotakeentrepreneurialdecisionstodrivevaluecreationfor

lowcarbon development,and to leverage privateinvestment?Can theycontribute to policydevelopmentandimplementationinareaswheretherearehugevestedinterestsinthestatus

quo?

Inshort,whatbecomesclearfromtheexperienceof theAmazonFundis thatto supportlow

carbon development, national climate institutions need to be truly developmental, and not

simply mechanisms to accountant for climate finance. Establishing meaningful, national low

carbongrowthanddevelopmentplansrequiresnewinstitutionalarrangementsunderpinnedby

transparencyandstrongpoliticalandeconomicleadership.


24/28


Exhibit6. EmergingnationalclimatefundsModel Examples Funding Governance Guidance Fund

Management

FundingCriteria

Typical Donation Inter

ministerial

committee

Governmental

ormulti

sector

advisorygroup

Initially

offshore

Linkedtonational

policy

Bangladesh

MultiDonor

TrustFund

Donation Government

Climate

ChangeUnit

underMinistry

of

Environment

andForests

Parliamentary

Groupon

Climateand

Environment

WorldBank

(with

intentionof

becoming

national

later)

Bangladesh

ClimateChange

Strategyand

ActionPlan

CongoBasin

ForestFund

Donation Governing

councilof

donors,

expertsand

some

stakeholders

CongoBasin

Forest

Partnership

African

Development

Bank.

Funding

decisions

madeby

governingCouncil

Innovation

Coherencewith

regionalplans

Cambodia

Climate

ChangeTrust

Fund

Donation Ministryof

Environment

onbehalfof

National

Committeefor

Climate

Change

(NCCC),

Multi

stakeholder

Technical

Advisory

Panel

UNDP(with

intentionto

transfertoa

national

committee

later)

Nationalpolicy

Multidonor

trustfund

Indonesian

Climate

ChangeTrust

Funds

Donation Ministerial

steering

committee

Technical

committee

(government)

UNDP(with

intentionto

transfertoa

national

trustee)

Linkedtonational

budget,roadmap

andmidterm

plan

Adaptation

fundnational

implementing

entities

Project

funding

from

adaptation

fund

Mayinclude

ministries,

inter

ministerial

commissions

and

government

cooperation

agencies.

National

body

Doesnotmake

fundingdecisions

makesdecisions

tosubmit

applicationsto

theAdaptation

FundBoard

Conservation

trustfund

Donations,

counterpart

funding,

revenues

Governing

councilof

NGO,sector,

academicsand

officials.

Consultative

council

former board

members.

Technicalcommittee

Independent

private

institutions

Programmatic

fundingareas(not

yetclimate

funding)

Fundo

Nacionaldo

Meio

Ambiente

(FNMA)

National

Environmental

Fund

Public

funding,

levies,

donations

Governing

Council of

government

ministries,

agencies and

NGOs

Environment

Ministry

Linkedtonational

fouryear plan,

with thematic

areasforfunding

National

Fund

ChinaCDM

Fund

Levy,public

fundingand

donations

Interministerial

governing

board

Ministryof

Finance

Contribute to

China

NationalClimate

ChangePlan

The Amazon

Fund

Donation BNDESBoard COFA BNDES Thematic,linked

tonationalplan.


25/28


1 Available to download from: www.zadek.net/wpcontent/uploads/2010/01/RadicalSimplicityinDesigning

NationalClimateInstitutions_LessonsfromtheAmazonFund.pdf2 In2009BNDEShostedaseriesofmeetingtocontributetotheAmazonFundsstrategy.Theproceedingsof

thesemeetingsarepublishedinthebookBNDES(2010)TheAmazonunderdebate:Opportunities,challenges

andsolutions.Availabletodownloadfrom:www.amazonfund.gov.br3 Mulller,B (2010) The Timeis Right! Devolutionof fundingdecisionsto designated national/regionalclimate

changefundingentities,OxfordEnergyandEnvironmentComment,November20094 See for example Craynest, L(2010) Business as unusual: Direct Access: Giving power back to the poor?,

Caritas/CIDSE,Brussels5 Thornton,N (2010) RealisingDevelopmentEffectiveness: Makingthe mostofclimatechangefinanceinAsia

andthe Pacific,SynthesisReport.Background to the AsiaPacificClimateChange Finance AidEffectiveness

Dialogue,1920October2010,Bangkok,Thailand6 Seefor exampleWilks,A (2010) Climateadaptation funding: Lessonsfromdevelopment finance, discussion

paper,Eurodad/ActionAid

7 Ballesteros,Athenaetal.Power,ResponsibilityandAccountability:Rethinkingthelegitimacyofinstitutionsfor

climatefinance.WRIWorkingPaper.WorldResourcesInstitute,WashingtonDC8 Spergel,BandTaeb,P(2008)RapidReviewofConservationTrustFunds,ConservationFinanceAlliance,

9 PWC(2010)NationalREDD+fundingframeworksandachievingREDD+readinessfindingsfromconsultation,

ConservationFinanceAlliance10

Sharma,A(2010)TheReformedFinancialMechanismoftheUNFCCC:Renegotiatingtheroleofcivilsocietyin

thegovernanceofclimatefinance.OxfordInstituteforEnergyStudies11

Shwartzman,S(2009)BrazilnationalandstateREDD,EnvironmentalDefenceFund12

SeeforexampleMcKinsey&Co(2009)Howtobuildacharitablefundandcreatethelearningorganisationto

make it succeed, a report based on a benchmark study commissioned by DFID to assist the Brazilian

governmentinestablishingtheAmazonFund13 Peskett, L, Luttrell, C and Iwata,M (2007) Can standards forvoluntarycarbon offsets ensure development

benefits?,ODIForestryBriefing13,July200714

SoaresFilho,B,Moutinho,P,Nepstad,D,Anderson,A,Rodrigues,H,Garcia,R,Dietzsch,L,Merry,F,Bowman,

M, Hissa,L, Silvestrini, R and Maretti, C. Role of Brazilian Amazon protected areas in climate change

mitigation.PNAS,Vol107no24,June15,201015

Muller,B(2010)TheReformedFinancialMechanismoftheUNFCCCPartII:TheQuestionofOversightPost

CopenhagenSynthesisReport,EV52,OxfordInstituteforEnergyStudies16

NGOreportfromSeptember2010COFAmeeting

http://deolhonofundoamazonia.ning.com/profiles/blogs/relatodaultimareuniaodo17

TheProtocolMultilateralFund,employs0.19peopleperUS$millionofthroughput,theGlobalFundemploys

0.21people/US$mandtheWorldBankGroupemploys0.5peopleperUS$million18 Lele,U,Viana,V,Verissimo,A,Vosti,S,Perkins,KandHussain,SA(2000)ForestsintheBalance:Challengesof

conservationwithdevelopmentevaluationcountry,CaseStudySeries,WorldBank19 RatajczakJuszko,I(2010)InternationalClimateFinancing:GovernanceChallengesFacingtheAdaptationFund,

BriefingPaperforthe14thIACCConferenceinBangkok,14thInternationalAntiCorruptionConference1013

November2010,Bangkok,Thailand


26/28


27/28

ABOUTTHEAUTHORS

SimonZadekisanonresidentSeniorFellowattheCentreforBusinessandGovernment

of Harvard Universitys Kennedy School. He founded, and was until recently Chief

ExecutiveofAccountAbility,whereheestablishedtheorganisationsgloballeadershipin

sustainability standards, collaborative governance and responsible competitiveness,

extendingitsimpactfrombasesinBeijing,SaoPaulo,LondonandWashington,andthroughactivitiesin

SouthAfricaandacrosstheMiddleEast.SimonsitsontheInternationalAdvisoryBoardoftheBrazilian

business network, Instituto Ethos, the Advisory Board of the sustainability fund manager, Generation

Investment Management, and the Boards of the International Centre for Trade and Sustainable

DevelopmentandtheEmployersForumonDisability.In2003hewasnamedaWorldEconomicForum

GlobalLeaderforTomorrow.Simonsworkwithbusinesses,governmentsandinternationalorganisations

over the last decade has contributedto establishing responsiblebusiness onthe global map asa core

businessstrategyandpublicpolicyissueandpractice.

SimoncanbecontactedatSimon@zadek.netortolearnmoreaboutSimonsworkvisitwww.zadek.net

Maya Forstater has worked for over ten years in the field of sustainable business,

leadingresearch andhelpingorganisationslearn,improveandcommunicateonissues

ranging fromclimate change to supply chain labour standards. She has worked with

majorcorporations,multisectorpartnershipsandbusinessgroupingsintheenergy,ICT,

apparel, mining and mineralsand mobility sectors, and has written extensively on a

range of issues related to sustainability and business. She has authored and contributed to numerous

publications including: Responsible Businessin Africa: Chinese BusinessLeadersPerspectives(Harvard

KennedySchoolofGovernment);LowCarbonGrowthPlans:AdvancingGoodPractice(ProjectCatalyst);

MobilityforDevelopment(WBCSD);TheUNEP/AccountAbilityHandbookonStakeholderEngagement;The

Materiality Report (AccountAbility); Corporate Responsibility: Implications for SMEs in developing

countries(UNIDO);andBusinessandPoverty:BridgingtheGap(IBLF).

[email protected]:@mforstater.

FernandaPolacowhasworkedforovertenyearsinthenonprofitsectorandinthe

field of sustainable development, participating in community programme

development, public health campaigning, public policy framing, research

development, communications strategy development and implementation and PR

campaigns.FernandahasparticipatedintheresearchwiththeAmazonFundonnew

climate institutions arrangements (Radical Simplicity in Designing National Climate Institutions: Lessons

from the Amazon Fund, 2009) and has authored and coauthored articles for media like the Financial

Times, Times, Fortune China, Ethical Corporation, Impactus, Ideia Socioambiental, CIVICUS, and Ethical

Performance.

[email protected]


28/28

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