Role of Civil Society Organisations in REDD Projects

Role of Civil Society

Organisations in REDD Projects

Sergio Salas

A joint study by the

Conservation Finance Alliance

and PricewaterhouseCoopers

Agenda/Contents

Our work in ecosystems and biodiversity Study overview

Activities to date The REDD context

Role of CSOs in meeting REDD objectives Where are we today?

Where are we today?

A general REDD structure Key emerging themes

1. Trust

2. Governance

3. Technical capacity and knowledge 4. Community capacity and knowledge 5. Sovereignty

Next steps

Our work in ecosystems and biodiversity

World Economic Forum Biodiversity Risks

Engaging big business in an exploration of the significance of biodiversity related risks.

UNEPFI – BBOP Biodiversity and

Finance Sector Study

A survey of global project finance specialists, exploring biodiversity awareness levels and biodiversity

UNDP Habitat Banking in LAC Region

Leading edge analysis of potential for habitat banking in 9 Latin America and Caribbean countries

Financial review of Juma RED Reserve

Through 2009 we are providing financial review services to Brazil’s leading RED Project, in the State of Amazonas.

Advisors to Paraguay’s first REDD project

PwC is providing independent review, guidance and market analysis to REDD project developers in Paraguay.

awareness levels and biodiversity offsets.

Sustainable investments in biodiversity

Economic review of four biodiversity investments in South America and Africa and development of investment fund model on behalf of WWF (2008).

• Undertaken by PricewaterhouseCoopers on behalf of the Conservation Finance Alliance (CFA)

• Study objective: To analyze the current and potential role of civil society organizations in the forest carbon supply chain

• Focus areas:

− Fiduciary management

− Participatory engagement

Study overview

− Participatory engagement

− Monitoring

• 12 focus countries

− Brazil

− Cambodia

− Colombia

− Costa Rica

− DRC

− Ecuador

− Indonesia

− Madagascar

− Mexico

− Peru

− Tanzania

− Uganda

Activities to date

• 40 interviews across a range of stakeholders:

National agencies

Lawyers Project developers

10 15

3

CHANGE NATIONAL AGENCIES TO

government

• Analysis of interim findings and emerging themes

• Aim to conduct 60 interviews in total

CSOs agencies

Carbon buyers/brokers

Financiers

10 15 7 10

15

Intended interview profiles

The REDD context

Objectives of REDD

• Reduce emissions from deforestation in developing countries

• Direct revenue streams towards incentivising change in forest resource use behaviour

• Positive implications for ecological policy and socio-economic development

Ecological context

• Rapid deforestation and degradation of global forests

• Reduce emissions and climate change impacts from deforestation and degradation

• Incentivise a change in forest resource use behaviour

Local community context

• Interest in beneficial forest management projects

• Seeking social and economic benefits

• Lack of capacity, knowledge, market access and effective governance

Role of CSOs in meeting REDD objectives

Environmental funds

• Strong connections to NGOs, government and market

• Experienced in fiduciary management

• Reputed for transparency and

International NGOs

• Variety of roles

• Active at all levels and linked to parties at all levels

• Widely known and reputed

Local NGOs

• Community advisors and representatives

• Project development, implementation and monitoring

• Reputed for transparency and governance

• Fund projects directly or indirectly through

international/national/local NGOs

• Knowledgeable about REDD and conservation

• Technologically capable

monitoring

• Revenue disbursement at community level

Where are we today?

Readiness stage – Phase 1

• Pilot and experimental stage of REDD

Readiness

• National strategy

Implementation

• National strategy

Scaling up

• Further

Phase 1 Phase 2 Phase 3

Phased approach to REDD

• CSOs dominate in this phase

• NGOs have an advantage

• Some funding available but limited experience in revenue management

• National strategy development

• Policy development and legislative action

• Institutional strengthening

• Initial funding

through bilateral and multilateral initiatives

• Capacity building

• National strategy implementation

• Bilateral and

multilateral funding and COP mandated funds

• Capacity building, including basic monitoring abilities

• Further

strengthening of national strategies, legislative actions and institutions

• Market and non- market financing based on

performance

• Advanced

monitoring abilities

A general REDD project model

Funding sources

International NGOs

• Variety of roles

• Active at all levels and linked to parties at all

Environmental funds

• Strong connections to NGOs, government and market

• Experienced in fiduciary management

• Reputed for transparency and governance

• Fund projects directly or indirectly through international/national/local NGOs linked to parties at all

levels

• Widely known and reputed

• Knowledgeable about REDD and conservation

• Technologically capable

• Fund projects directly or indirectly through international/national/local NGOs

Local NGOs

• Community advisors and representatives

• Project development, implementation and monitoring

• Revenue disbursement

Local communities

• Interest in beneficial forest management projects

• Seeking social and economic benefits

• Lack of capacity, knowledge, market access and effective governance

• Lack of trust in external parties

Key emerging themes

Trust

Trust among actors is a critical element to the success of REDD.

Governance

Transparency and strong governance at all levels is essential to build trust and credibility.

1 2

Technical capacity and knowledge

REDD requires complex technical capabilities

Sovereignty

Legal frameworks and national

approaches to REDD are still evolving.

Community capacity and knowledge

Local communities and NGOs lack sufficient capacity and knowledge of REDD and carbon markets.

3 4 5

Trust

Key issues

• Close relationships between NGOs and local communities are essential to success

• Previous disappointments create mistrust in new solutions and ideas

Role of CSOs

• Local community trust in NGOs is critical to project success

• Local NGOs and/or local community organisations disburse revenues

1

• In some countries, communities and local NGOs are resistant to market solutions

• High expectations are created among communities

• Environmental funds have the capacity to support strong governance mechanisms

Governance

Key issues

• Lack of transparency in revenue distribution

• Poor or absent local community governance frameworks

• Need for clarity of roles and accountabilities of parties

Role of CSOs

• Environmental funds have credibility among investors and markets

• Involvement of environmental funds and international NGOs reduces project risk

• Local NGOs have a niche role with respect to

2

parties

• Transparency and corruption issues question legitimacy

• Transparency of revenue transfers between parties

• Legal void in many countries creates uncertainty

• Set up costs for funds and projects can be high and the processes can be lengthy

• Absence of or insecure land rights complicate

• Local NGOs have a niche role with respect to communities

• Environmental funds and NGOs support

communities to overcome land tenure barriers

• NGOs and environmental funds provide legal expertise and support in clarifying land tenure issues

Technical capacity and knowledge

Key issues

• Technology gap between local communities and international standards

• Presence of cost barriers to small-scale forestry projects

• Lack of local capability and technological

Role of CSOs

• NGOs can bridge the gap between the reality of the field and international standards and

expectations

• Environmental funds can fund monitoring services

3

• Lack of local capability and technological resources for monitoring

services

• Local NGOs have the potential to play a role in monitoring and verification

• International NGOs have the technical

knowledge and resources to build local capacity

Community capacity and knowledge

Key issues

• Local communities

− Lack of information and knowledge of markets

− Lack of market access due to language barriers, geography

Role of CSOs

• Local NGOs build local community knowledge and capacity

• Environmental funds and NGOs facilitate information flow between the market and communities

4

− Small projects are costly and difficult

• Local NGOs

− Lack of information and understanding of REDD

− Lack of legal expertise, market knowledge and capacity for risk assessment

− Lack of capability and technological resources for monitoring

communities

• Environmental funds have a role in educating and building NGO capacity

• International NGOs build capacity of local NGOs

• International NGOs have a holistic view and can operate at various levels to build capacity

Sovereignty

Key issues

• National vs. sub-national approaches

• National approaches create fewer opportunities for NGOs and environmental funds

• Outsourcing of monitoring services dissipates revenue

Role of CSOs

• NGOs and environmental funds can play a role in MRV in both sub-national and national level approaches

• Environmental funds are well-placed to advice governments on the legal frameworks

5

revenue

• Conflicting government priorities

• Absence of legal frameworks in most study countries

governments on the legal frameworks necessary

Key challenges

•No direct experience in managing and disbursing REDD revenues

•There are few legal frameworks in place that support REDD mechanisms

•Community and individual land holdings are often small-scale and face high cost barriers

•Transparency and corruption feature prominently as a key challenge in relation to the public sector

•Local communities lack knowledge of the market, REDD mechanisms and the issue of climate change

•Trust is a key element that is not easily forged between diverse actors with diverse interests and roles International NGOs increase credibility and investability of projects but not to the level required for

•International NGOs increase credibility and investability of projects but not to the level required for substantial private sector participation

Next steps

Conduct interviews

− aim to have sample of 60 interviews

Interview analysis

Creation of a final report

Ongoing market analysis

Add closing statement here

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

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