The Global Environment Facility
The First Ten Years – Growing Pains or Inherent Flaws?

a report by environmental defence and halifax initiative - August 2002

2. History, Governance, Operations and Results

Since their mandate was to tap whatever financial resources were available, they accepted the GEF as the interim financial mechanism for the UN Conventions on Climate Change and Biodiversity - with the provision that the GEF undergo fundamental reforms which would make it more open, transparent and participatory.

Restructuring the GEF – 1994

At the Rio Earth Summit, North/South polarization over the environment was most evident during finance negotiations. It soon became apparent that GEF, still a pilot project, would never become a permanent entity until it responded to at least some of the demands of the South. The main points of contention were:
· who could participate in GEF (membership in the Pilot Phase involved a several million dollar fee);
· who made the decisions (voting rights in the GEF governing bodies were not equitable);
· who ran the GEF (the World Bank did, despite the tokenistic inclusion of UNDP and UNEP);
· who controlled meetings of the main governing body, the GEF Council (again, an equity issue).

Southern governments wanted universal country membership in the GEF without having to make a financial contribution. They demanded that the chairperson be elected by the GEF Council to ensure it was not run by a World Bank official. They wanted the power and influence of the World Bank reduced and insisted the GEF function more like a United Nations-type body.