By Dr. Ruth Adler

Climate change represents an existential threat to life on Earth. The Intergovernmental Panel on Climate Change (IPCC) estimates that climate policies consistent with the 2015 Paris Agreement ¹ goals of limiting the increase in global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the increase to 1.5°C will require investments in the energy system of USD1.6–3.8 trillion per year over the period 2016–50.² The IPCC also highlights that the average annual investment requirements to limit warming to 2°C or 1.5°C over the period 2020–30 are three to six times greater than current levels and that investment in mitigation needs to increase in all sectors and regions globally.³

The Green Climate Fund (GCF) plays a critical role in global efforts to address climate change. Established in 20210, its mandate is to support developing countries in the pursuit of ‘low emissions, climate-resilient pathways’ and the achievement of their nationally determined contributions under the Paris Agreement.⁴ There has, however, been limited research to date on the fund’s effectiveness in achieving its objectives and its contribution to achieving the objectives of the Paris Agreement. Financing Climate Justice: The Green Climate Fund in a Changing World addresses this lacuna. The book examines the effectiveness and legitimacy of the GCF from several perspectives, including the fund’s discourse; its governance, funding approval processes and mechanisms for stakeholder consultation; its accountability and transparency regime; the effectiveness of its resource mobilisation and allocation policies; and the performance of the fund’s portfolio of projects.

A discourse based on the principles of mainstream and expansive sustainability

The book argues that the GCF’s discourse and operational model reflect the principles of mainstream and expansive sustainability. In general terms, mainstream sustainability discourses are based on the premise that, while mitigation and adaptation are necessary, climate change can be addressed within the ‘existing parameters of global and political order’.⁵ Expansive sustainability is based on the premise that economic development and ecological sustainability are compatible. The fund derives a degree of legitimacy from its discourse because the United Nations Framework Convention on Climate Change (UNFCCC) Conference of Parties (COP) was—after a challenging negotiation—able to agree on the adoption of its Governing Instrument⁶ and there was consensus among developed and developing country parties that country ownership and direct access by developing countries to the fund’s resources should be guiding principles. However, there were profound differences between developed and developing countries on issues such as which parties should bear the burden of funding the GCF, whether the funding should be from public or private sources, and on the role of the private sector. These disagreements persisted during the fund’s establishment phase and indicated that developing countries, supported by civil society organizations, harboured concerns about its design from the outset.

Governance, funding approval processes and mechanisms for stakeholder consultation

The book argues that the fund derives legitimacy from the equal representation of developed and developing countries on its board. It also contends that, while the GCF has mechanisms for the participation of—and consultation with—stakeholders, there are, however, shortcomings in their operation, as well as with the GCF’s funding approval processes. The book also considers the legitimacy of the fund’s accountability mechanisms and argues that, while the GCF has an accountability and transparency regime, there are shortcomings in its operation.

Resource mobilization and allocation

Financing Climate Justice shows that the GCF has experienced a significant shortfall in resources and that the fund’s resource mobilization efforts through donor contributions have had limited success. The resourcing shortfall has been exacerbated by President Trump’s January 2025 announcement that the United States would withdraw from the Paris Agreement⁷ and the administration’s decision to cancel a USD3 billion multi-year pledge made to the fund under former President Biden.⁸

The book also demonstrates that the GCF’s policy on mobilizing resources through co-financing from third parties has been less effective in attracting non-GCF funding for activities in developing countries that are particularly vulnerable to the adverse impacts of climate change, such as the GCF priority groups (the African states, least developed countries and small island developing states) and for adaptation.

This book argues that the GCF has been effective in ensuring a balance in allocating resources between mitigation and adaptation, and that a minimum of 50% of adaptation funding is for activities in particularly vulnerable developing countries. However, the GCF has not achieved its objectives of ensuring direct access and country ownership. Moreover, while the fund’s policies on financial instruments are intended to encourage private investment, its use of loans and mechanisms with repayment facilities has the potential to increase the indebtedness of developing countries, especially those that are heavily indebted or least developed, and is not consistent with the principles of distributive justice and equity.

Performance of the GCF project portfolio

Taking a deep dive into the fund’s project portfolio, the book shows that the results to date have been mixed. Many approved projects have experienced delays, implementation challenges and/or have lapsed or been cancelled. In addition, assessing the likely impact of the GCF’s investments is difficult because of the limited availability of performance information and the poor quality of the fund’s results measurement and reporting to date.

The book concludes that, overall, the fund enjoys limited legitimacy for many developing countries and key stakeholders, and is, therefore, not well-positioned to deliver the goals of the Paris Agreement. The book considers prospects for enhancing the effectiveness of the governance of the GCF and recommends reforms to the operation of the fund’s accountability and transparency mechanisms, as well as with respect to its allocation of funding, use of financial instruments, and monitoring and evaluation processes.

Dr Ruth Adler is a Adjunct Researcher at the School of Law, University of Tasmania, Australia

Financing Climate Justice is available in hardback and eBook. Learn more here.

Free chapter available on Elgaronline.

1. Paris Agreement, opened for signature 12 December 2015, 3156 UNTS 79 (entered into force 4 November 2016). ↩︎
2. J Rogelj et al, ‘Mitigation Pathways Compatible with 1.5°C in the Context of Sustainable Development’ in Masson-Delmotte et al (eds), Global Warming of 1.5°C: An IPCC Special Report on the Impacts of Global Warming of 1.5°C above Pre-Industrial Levels and Related Global Greenhouse Gas Emission Pathways, in the Context of Strengthening the Global Response to the Threat of Climate Change, Sustainable Development, and Efforts to Eradicate Poverty (Cambridge University Press, 2018) 93, 154 <https://www.ipcc.ch/sr15/chapter/chapter-2/>. See also Intergovernmental Panel on Climate Change, Climate Change 2023: Summary for Policymakers (Synthesis Report, 2023) <https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf>. ↩︎
3. Intergovernmental Panel on Climate Change, Climate Change 2023 (Synthesis Report, 2023) 111 <https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_LongerReport.pdf>. ↩︎
4. About GCF: Overview’, Green Climate Fund (Web Page) <https://www.greenclimate.fund/about> ↩︎
5. Hayley Stevenson and John S Dryzek, ‘The Legitimacy of Multilateral Climate Governance: A Deliberative Democratic Approach’ (2012) 6(1) Critical Policy Studies 1, 4 (‘The Legitimacy of Multilateral Climate Governance’). See also Hayley Stevenson and John S Dryzek, Democratizing Global Climate Governance (Cambridge University Press, 2014). ↩︎
6. Green Climate Fund, Governing Instrument for the Green Climate Fund (2011)<https://www.greenclimate.fund/document/governing-instrument> (‘Governing Instrument’). ↩︎
7. Donald J Trump, ‘Putting America First in International Environmental Agreements’ (The White House, 20 January 2025) <https://www.whitehouse.gov/presidential-actions/2025/01/putting-america-first-in-international-environmental-agreements/>. ↩︎
8. See US Department of the Treasury,‘Announcement of Pledge to Second Replenishment of the Green Climate Fund’(Press Release, 2 December 2023) <https://home.treasury.gov/news/press-releases/jy1942>; Megan Rowling, ‘After US Cuts Cash, Green Climate Fund Head Urges Others to Step Up’, Climate Home News (online, 10 February 2025) <https://www.climatechangenews.com/2025/02/10/after-us-cancels-cash-for-green-climate-cuts-funds-its-head-warns-of-consequens/>. ↩︎