International law and the governance of climate finance: navigating global institutional complexity

Abstract

This thesis is of legal clarification, analytical discovery and method. It questions the relationship between international law and the institutional complexities of global governance by taking climate finance as a fruitful ground of analysis. Furthermore, it provides a novel systematization and critical appraisal of the international law applicable in the context of climate finance. Climate finance can be broadly defined as the transfer of financial resources from industrialised states to developing countries for the purposes of climate mitigation (reducing greenhouse gasses emissions) and adaptation. Although numbers are uncertain, currently states face not just the policy challenge of scaling up climate finance to needed levels, but also the one of forming a sustainable and effective institutional structure. In fact, the scant international obligations contained in the United Nations Framework Convention on Climate Change and its Kyoto Protocol have developed into a complex international and multilevel regulatory realm, where numerous and multifarious institutions de facto implement the treaties by acting as intermediaries for the sourcing and disbursement of financial resources towards developing countries. In addition to offer a detailed outline of the regulatory roles and development of these ‘climate finance institutions’, the thesis relies on an understanding of ‘governance’ and ‘legitimacy’ as two fundamental but multifaceted conceptual devices. Because international law faces some ‘cognitive limits’ in dealing with the governance aspects of the institutional complex of climate finance, a new conceptualization, based on the idea that such institutions compete and at the same time seek to complement their activities, underpins an analysis of inter-institutional instruments. This allows discovering some legal practices, which promote complementarity in the context of geographical, functional and regulatory institutional overlaps. Despite these emerging realities, the ‘effectivity’ of climate finance institutions still faces legitimacy challenges, as their activities and regulations are often contested by a wide array of actors (states, private entities, and national groups). This work proposes a comparative analysis between six climate finance institutions, based on a theoretical stand that a legal analysis of institutional legitimacy should be based on some relevant procedural components. The comparative analysis, based on four regulatory factors, provides numerous elements for a reflection on the interplay of legitimacies among climate finance institutions. Equipped with a legal clarification of the principles and the substantive international legal issues provided in the first chapter, the thesis concludes with three lines of argument. First, climate finance institutions will increasingly face the need to balance the existing bias towards contributor countries with the emerging concept of country ownership of funds, while enhancing their accountability. Second, the analysis unfolds and structures several substantive and institutional tensions, which require constant and further engagement from lawyers in interpreting and framing future developments. The third and broader argument is, instead, of legal method: methodologically it is a more fruitful path for international lawyers to deal with the legitimacy of (global) governance, rather than with the governance of legitimacy. While the intellectual goal of ‘governing legitimacy’, followed by several scholars, hinges on a, refutable, managerial idea of the law, the pluralist legal structure of global governance opens uncountable spaces for lawyers to reconceptualise and discover new ‘intimated’ practices of law.