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Adapting to Climate Change: Assessing the World Bank Group ...

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CHAPTER 2ADAPTATION AT THE BANK GROUP2.13 These are not definitive measures; understanding of climate change adaptation willimprove over time. But measures such as <strong>the</strong>se, closely tied <strong>to</strong> climate and climateimpacts, will accelerate <strong>the</strong> learning process.<strong>Climate</strong> Risk Identification for Projects2.14 The SFDCC committed <strong>the</strong> <strong>Bank</strong> <strong>Group</strong> <strong>to</strong> “screen climate-sensitive investmentswith long life spans, starting with hydropower projects and selected water and agricultureprojects.” This goal was not accomplished. Following is an account of how <strong>the</strong> existingrisk identification systems deal with climate variability and change.CLIMATE RISK IDENTIFICATION AT THE WORLD BANK2.15 In FY11, <strong>the</strong> <strong>World</strong> <strong>Bank</strong> put in place a new comprehensive system (<strong>the</strong>Operational Risk Assessment Framework, or ORAF) for rating project risks through <strong>the</strong>entire project cycle. Risks are categorized as stakeholder level, operating environment,implementing agency level, or project level. Project-level risks are fur<strong>the</strong>r subdivided in<strong>to</strong>design risk, safeguard risk, program and donor risk, delivery quality, and o<strong>the</strong>r riskcategories. <strong>Climate</strong> risks do not fit neatly in<strong>to</strong> this system, and are not treated consistently.Sometimes <strong>the</strong>y are characterized as country risks and sometimes as design risks.2.16 Based on ORAF data, Table 2.1 distinguishes projects in more versus less climatesensitivesec<strong>to</strong>rs, and tallies <strong>the</strong> number of projects in each group that identified climaterisks 9 or mentions <strong>the</strong>m in <strong>the</strong> project document. As expected, attention <strong>to</strong> climate wasmuch greater in <strong>the</strong> climate-sensitive sec<strong>to</strong>rs. A majority of <strong>the</strong>se projects discussedclimate, but only a quarter actually identified climate as a risk. There is no presumption, orcourse, that climate risks should be identified in all projects.2.17 Of 23 projects that identified climate risks, only one identified a long-term risk due<strong>to</strong> climate change. This was <strong>the</strong> Bangladesh Padma Bridge project, in which an expensiveasset was constructed that is expected <strong>to</strong> stand a century or more. Ano<strong>the</strong>r 16 identifiedclimate variability as a project-level risk, and six mentioned it as a country-levelbackground risk.Table 2.1. <strong>Climate</strong> Risk Identification in FY11 <strong>World</strong> <strong>Bank</strong> ProjectsMore climatesensitivesec<strong>to</strong>rLess climatesensitivesec<strong>to</strong>rTotal number of FY 11 projects with ORAF documents 78 101 179<strong>Climate</strong> risks in ORAF 19 4 23<strong>Climate</strong> reference in <strong>the</strong> project document, no climate risks 40 31 71No reference <strong>to</strong> climate in document 19 66 85Source: IEGTotal18

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