An audit report released by Oxfam International on Thursday showed that as much as $41 billion in World Bank funds allocated to climate causes went unaccounted for between 2017 and 2023 due to poor accounting standards. [emphasis, links added]
This huge amount of money represents almost 40% of the climate finance disbursed by the World Bank over the seven-year period, and World Bank data fails to show the recipients and use of this money, Oxfam's investigation found.
“The World Bank is quick to brag about its billions in climate financing, but these numbers are based on its planned spending, not actual spending once projects are launched,” said Kate Donald, director of Oxfam International's Washington, D.C. office, in the release. .
“It's like asking your doctor to evaluate your diet just by looking at your shopping list, without checking what's actually in your refrigerator.”
Oxfam said auditors could not determine whether climate cash was used for “climate-related measures designed to help low- and middle-income countries protect people from the climate crisis and invest in clean energy.”
The World Bank is the largest provider of environmental finance among all multinational financial institutions, Oxfam reports that it plans to spend 45% of its annual financing on green initiatives between July 1, 2024, and June 20, 2025.
As of May 31, the United States was the bank's largest shareholder, holding more than 15% of the voting shares.
“Climate finance is scarce, and yes, we know it’s hard to achieve. But not tracking where or how the money is actually spent? It’s not just some bureaucratic oversight — This is a fundamental breach of trust and threatens to undermine the progress we need to make at the COP this year,“Donald said in the press release.
World Bank's poor record-keeping practices made audit work 'hard and difficult', Oxfam reports.
“We had to sift through layers of complex and incomplete reports, and even then, Data is full of gaps and inconsistencies“, Donald said in a press release.
“The fact that this information is so difficult to access and understand is shocking— It shouldn’t take a team of professional researchers to figure out how the billions of dollars spent on climate action are being spent. This should be transparent and accessible to everyone (most importantly the community) [that] Aim to benefit from climate finance.
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