Due in part to unclear REDD+ rules, there are plenty of opportunities to cheat, experts say. Vilseskogen

BRASILIA, Brazil (1 April, 2013) _ U.N.-backed  efforts to slow forest loss could be derailed by corruption, experts warned as they pointed to a potentially dangerous combination: An opportunity to make a lot of money and weak governance in many of the participating countries.

Unless tackled, they said, communities most dependent on these biodiverse ecosystems may not see the benefits.

The forestry sector is one of the most prone to graft globally.

Among other things, it’s threatened by bribery and unclear land tenure rights, a lack of access to accurate or credible information, and an absence of transparency around financial flows, research groups and environmental experts told the International Anti-Corruption Conference held in Brasilia, Brazil in November 2012.

“In effect, what REDD+ has done is establish  a new value for forests, which we call carbon,” said Andrew Wardell, Research Director of the Forest and Governance portfolio  at the Center for International Forestry Research. “This has opened up a pandora’s box of new claims to — and new contests associated with — forested lands in many developing countries.”.

He was referring to the U.N.-backed scheme that seeks to reduce the amount of greenhouse gases being pumped into the atmosphere by deforestation and land degradation — two of the biggest culprits.

In effect, the idea is to get rich countries to pay poor, heavily forested nations to keep their trees standing.

But experts say, due in part to unclear REDD+ rules, there are plenty of opportunities to cheat.

Malpractice, they said, could include anything from manipulation of baselines, carbon emissions reports and accounting systems to the violation of rights of forest-dwelling communities.

Some countries, like Indonesia, have demonstrated a strong commitment to improving governance and curbing corruption.

But will a potential REDD+ windfall trigger a return to old ways?

Aled Williams, from the U4/Anti-Corruption Resource Centre, says we need to get ahead of the problem, identify issues that have cropped up in the forestry sector in the past.

“But it’s not easy,” he said, noting if we’re focussing too heavily on embezzlement by top government officials, for example, we might fail to see graft tied to benefit-sharing on the ground.

“A lot of the time we are anticipating potential risks of corruption, rather than actual corruption risks.”

“Real cases, too, hold important lessons for the future,” Williams said.

Take Uganda.

Between 2002 and 2010 the World Bank, and the Global Environmental Facility disbursed USD$37 million in loans and grants to the country’s Ministry of Trade, Tourism and Industry and its Wildlife Authority for a range of conservation activities, he said.

But in 2011, despite previous inspections by the World Bank, a commission of enquiry headed by a retired supreme court judge discovered widespread irregularities and found that many project objectives had not been met, Williams said.

The country has since been asked to pay back the money plus interest, he said.

Mustafar Ali, from Malaysian Anti Corruption Commission (MACC), shared his own country’s experience.

Malaysia, established  the Anti-Corruption Commission (ACC) in 1959. It has the power to investigate and to enforce in both public and private sectors, he said.

“We have had cases where we have arrested senior officers from the ministry, from the governments. The anticorruption commission also needs to have public confidence and support, including the forestry sector.”

He also highlighted the importance of having a clear definition of corruption: “Corruption perceptions can vary from one country to another. Some people can say ‘this is not corruption, these are professional fees’.”

Sigrid Vasconez, who works at Grupo Faro, which has participated in the development of annual forest reports for seven countries, meanwhile said there must be what she called “basic conditions to allow REDD+ to develop.”

“We need to have a strong political will, not only in the forestry sector but at a multi-sectoral level,” said Vasconez, who works in Ecuador.

“We also need efficiently managed budgets and we need consultation and participation mechanisms. This is critical in preparation to REDD, but also for the implementation of REDD initiatives.”

She went on to say there is a need to have discussions about transparency and access to information related to the forest sector and to engage civil society in thinking about corruption issues in relation to the environment and the forests.

These same issues are of particular concern to  agencies like the international criminal police force.

Davyth Stewart, from Interpol France, worries about the possibility that “the money will be diverted into the wrong hands and maybe there will be an inequitable distribution.”

A clear set of minimum judiciary standards, independent audits, up-to-date and publicly available financial accounts, meetings of the government body that controls the fund are open to observers and the general public and broadcasted by the media, were some of his suggestions.

Stewart also pointed to a need to empower the key stakeholders, so they can participate and find the best way to balance the power.

CIFOR’s Research Director Wardell concluded by saying many of the issues presented at the Brasilia conference are not new. “Malaysia has grappled with corruption for 50 years, Indonesia for more than 30 years, he noted: “There is nothing really new under the sun in terms of these challenges.”

What is remarkable is that the institutional architecture to address deeply-embedded forest governance issues has become  much more complex, he said.

“There are huge networks of institutions related to supporting anti-corruption activities with different approaches.”

However, countries still have to solve what he called “wicked problems.” For example, in many countries there are unclear immoveable property rights (who owns the land), overlapping claims to the same land and different sectors competing to use the land for different purposes, including the mining, agriculture and energy sectors.

“How do we ensure that these different sectors are within the law in terms of the opportunity costs and the potential benefits to the country?,” asked Wardell.

Much of REDD’s development is predicated under the assumption that if you own the land you therefore own the carbon. But is this a safe assumption?,” he asked.

“At the moment in most countries the governance arrangements are not yet in place to ensure effective and equitable  benefit sharing mechanisms will actually operate,” he said.

“REDD might lead to new opportunities whilst we continue to address some of the potential new corruption challenges.”

This work forms part of the CGIAR Research Program on Forests, Trees and Agroforestry.