Combatting Climate Corruption: A Crucial Step Toward Saving Our Planet

Global temperatures are climbing. Each year is hotter than the last. We often focus on policies and technology for climate action, but there’s another issue we must confront: climate corruption.

Corruption and climate change are deeply intertwined. Corruption can intensify climate change, and vice versa—climate change can create conditions that allow corruption to flourish. A 2024 study looked at 171 countries and found a strong link between high corruption levels and climate risk. The study concluded that corruption increases both the frequency and the impacts of climate disasters.

Despite this, the impact of corruption on climate initiatives often goes overlooked. Transparency International defines “climate corruption” as the misuse of power for personal gain, which not only leads to climate injustice but also hinders genuine climate efforts.

Corruption can show up in various ways. It can mean siphoning off funds meant for climate projects, pressuring governments to weaken environmental regulations, bribing officials, or even misleading the public through greenwashing. A report by the UNODC emphasizes the need for stricter measures against corruption to ensure effective sustainable development. It states that without addressing corruption, investments meant for climate action will be wasted.

With the urgency of climate change, massive funding is being directed towards projects designed to alleviate its effects. The United Nations Environment Programme estimates that countries will need to spend $387 billion annually by 2030 to combat climate risks effectively. Such large sums inevitably attract corruption, diverting vital resources and undermining the public’s trust.

Take Australia’s Emissions Reduction Fund, for example. Research from the Australian National University revealed that 70-80% of funded projects fail to achieve real emissions reductions, essentially wasting billions on ineffective carbon offsets. Additionally, a $7.8 million project in Russia aimed at improving lighting efficiency fell short of its goals, with indications of deliberate fund misallocation.

Climate corruption isn’t just a public sector issue; it also impacts the corporate world. A 2024 study showed that climate risks can increase corporate fraud by intensifying performance pressures and debt demands. Instances of greenwashing—like Volkswagen’s scandal involving emissions tests—also reflect the problem. Companies claim to be eco-friendly while misleading consumers about their true environmental impact.

On the corporate side, funds intended for climate initiatives have been misused too. In 2018, Michael Rufatto of North American Power Group was found to have diverted federal funds for personal expenses rather than the intended carbon sequestration project. Such actions undermine efforts to address climate change effectively.

To tackle climate corruption, companies can take several steps:

1. Assess corruption risks: Companies should evaluate their existing anti-corruption measures, tailoring them to address unique climate-related vulnerabilities.
2. Offer training: Employees should understand how to recognize climate-specific corruption and know the company’s policies for handling it.
3. Foster collaboration: ESG (Environmental, Social, and Governance) teams and compliance departments must work together, sharing knowledge to reduce risks associated with climate corruption.
4. Be transparent: Accurate disclosures about anti-corruption measures in ESG reports can demonstrate a commitment to fighting corruption while making every climate dollar count.

We face a pressing challenge in combating climate change. Every dollar dedicated to this cause must be used wisely. Addressing climate corruption is essential to ensuring a greener and more sustainable future.

Check out this related article: Confronting Global Inequality: How the Climate Crisis Exacerbates Disparities Among Nations