How to Make the Management of Public Finances Climate-Sensitive–“Green PFM”: This How to Note develops the “green public financial management (PFM)” framework, briefly outlined in an earlier Staff Climate Note (2021/002, published in August 2021). It illustrates, how climate change and environmental concerns can be mainstreamed into government’s institutional arrangements in place to facilitate the implementation of fiscal policies. 

To support European governments in their development of green budgeting practices, the European Commission, the International Monetary Fund and the Organization for Economic Co-operation and Development worked jointly to define main elements and features of these practices, on the basis of existing green budgeting frameworks, presented in the paper Green Budgeting: Towards Common Principles.[CM1] 

The Guidance Note: Budgeting for Climate Change: A Guidance Note for Governments to Integrate Climate Change into Budgeting illustrates how climate change and environmental concerns can be mainstreamed into government’s institutional arrangements in place to facilitate the implementation of fiscal policies. It provides numerous country examples covering possible entry points for green PFM – phases in the budget cycle, legal framework or issues that cut across the budget cycle, such as fiscal transparency or coordination with State Owned Enterprises or with subnational governments. It builds on the work of UNDP as a technical partner in the Coalition of Finance Ministers for Climate Action.

The guide Strengthening the Role of Ministries of Finance in Driving Climate Action covers the case for climate leadership by Ministries of Finance, a framework for mainstreaming climate into their core functions and capabilities, and priorities for action. It is aimed primarily at Ministries of Finance but is designed to be useful to anyone seeking to better understand the role of these ministries in driving climate action.

The OECD Development Assistance Committee (DAC) established the Rio Markers to track aid that supports the implementation of Rio Conventions on biodiversity, desertification, and climate change. There are four markers: biodiversity, desertification, climate change mitigation, climate change adaptation. The Handbook OECD DAC Rio Markers for Climate explains how to classify activities and provides specific criteria for eligibility. It also includes an indicative table for guidance on Rio marking by sector/subsector and examples of qualifying activities.

Green budget tagging can be a useful tool in an overall approach to green budgeting. The introductory guidance Green Budget Tagging - Introductory Guidance & Principles was developed by the OECD under the Paris Collaborative on Green Budgeting in collaboration with institutional partners working under Helsinki Principle 4 of the Coalition of Finance Ministers for Climate Action (Inter-American Development Bank (IADB), IMF, UNDP, World Bank) and draws lessons from existing country practices. It  aims to provide high-level guidance in relation to designing, implementing and improving green budget tagging. 

This guidance note Knowing what you spend is intended for government agencies responsible for climate finance within Ministries of Finance, Ministries of Planning, or climate change policy making bodies (e.g., Climate Change Commissions, Ministry of Climate Change, Ministry of Environment and Forests etc.) that wish to set up a Climate Budget Tagging (CBT) system or strengthen an existing one.

The purpose of the report Climate Change Budget Tagging: A Review of International Experience is to provide development practitioners and government officials with an understanding of the context and key design features of climate budget tagging initiatives. It is based on a review of 18 climate budgeting tagging methodologies as well as key informant interviews with practitioners during 2020.

The “Climate-PIMA” (C-PIMA) adds a climate-responsive dimension into the PIMA framework and assesses countries’ capacity to manage climate-related infrastructure. The C-PIMA helps governments identify potential improvements in public investment institutions and processes to build low-carbon and climate resilient infrastructure.

The Sustainable Public Procurement (SPP) module of the Methodology for Assessing Procurement Systems (MAPS) is intended to provide a harmonized tool for use in the assessment of SPP. SPP is a strategic approach that promotes the integration of the three pillars of sustainable development - economic development, social development and environmental protection.

The report Green Public Procurement – An Overview of Green Reforms in Country Procurement Systems provides an overview of international experience in the implementation of Green Public Procurement (GPP). It focuses on the institutional framework that is needed to support the mainstreaming of GPP practices across government.

Green Public Procurement (GPP) Framework in Japan is a Basic Environment Act to promote use of goods and services that help reduce environmental impacts; It is an “Action Plan for Greening of Government Operations” that included GPP commitments and reporting requirements; and “Act on Green Purchasing” to promote green purchasing that required the government to establish a basic policy and list of designated goods. It supports availability of information about Eco labeled products.

Monitoring Green Public Procurement (GPP) in Korea: Institutional Arrangements: [CM1] This study covers the online e-procurement systems in the Republic of Korea. It takes a close look at Korea’s state-of-the-art Green Public Procurement policy impact measurement methodology, with an overview of other successful international experiences. It makes recommendations on possible innovations to public procurement policy and measuring its impact.

Integrating Climate Action into Public Financial Management: Lessons from Paraguay and Costa Rica: The integration of climate action into public financial management is a complex task that must be approached in an orderly manner, maintaining a medium-term perspective. The paper shows how to structure a strong plan, using as a basis the incremental improvements proposed by the PEFA-Climate methodology and international best practices in the field.

Green Budgeting in OECD Countries 2024: This report provides an overview of green budgeting practices across OECD countries based on the 2022 OECD Green Budgeting Survey, as well as the index methodology for the Survey. It takes stock of OECD countries’ progress in bringing climate and environmental considerations into budgeting frameworks and processes.