Two Decades after the Rio Earth Summit: Sustainable Development Quo Vadis?
 
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Korinna Horta
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Completed her Ph.D. in development studies at the University of London (SOAS), holds an M.A. in Latin American Studies and International Economics from Johns-Hopkins-University (SAIS) in Washington, D.C. and a degree in social science from the Universidade Nova de Lisboa, Lisbon.
She has been a Yale University Stimson Fellow and a guest lecturer at universities in the U.S. and Europe. In addition to being a consultant to the United Nations Research Institute for Social Development and other international organizations, she served from 1990-2009 as a senior scientist at the Environmental Defense Fund in Washington, D.C.. At present she works on international finance, environment and human rights at Urgewald, a German organization.   Since 2010 she also serves as a member of the Compliance Review Panel at the Inter-American Development Bank in Washington, D.C..
Among her publications are articles in the Yale Journal for International Affairs, the Harvard Human Rights Journal, the New Scientist and other journals. In addition, she published a book on international financial institutions and biodiversity and co-authored a book on East Timor. She has also written op-ed pieces and contributed several chapters to books on human rights, global environmental politics and international financial institutions.


Abstract

The world’s most influential development agency, the World Bank Group (WBG), is the leading actor in development finance and plays a central role in global efforts to protect the environment. Following the Rio Earth Summit in 1992, the institution was responsible for all investment projects of the Global Environment Facility (GEF), which was then newly established to serve as the interim financial mechanism for the United Nations Conventions on Climate Change and Biodiversity. The promise that the GEF would lead to the “greening” of development finance remains largely unfulfilled.
More recently the United Nations Framework Convention on Climate Change appointed the WBG as the interim trustee of the new Green Climate Fund which plans to mobilize an estimated US$ 100 billion per year by 2020.
While the World Bank Group plays this critical role in global environmental efforts, its main business continues to be lending for development. This includes the financing of large-scale infrastructure projects, agribusiness, large dams as well as investments in gas, oil and mining. This regular lending portfolio for development is often at odds with environmental sustainability. For example, despite the growing area of climate finance, support for fossil fuel projects continues to be dominant in the institution’s lending for the energy sector. Another climate-related area is the World Bank’s pioneering role in advancing REDD+, an initiative designed to reduce the emission of global green house gases by integrating efforts to protect forest areas into global carbon markets. Ultimately, its success will depend on addressing sensitive questions such as land ownership, forest governance and the equitable sharing of benefits.
In conclusion the paper considers the underlying corporate culture and the difficulties in reconciling environmental and social sustainability with the institution’s supply-side driven focus on meeting lending targets.