B.17/11: GCF risk management framework

The Board, having reviewed document GCF/B.17/12 titled “GCF risk management framework: Risk Management Committee proposal”:

1. Adopts the first set of components of the risk management framework as contained in annexes V to VIII to this document as follows:
   
   1. Risk management framework component I – revised risk register, as set out in annex V;
   2. Risk management framework component II – risk appetite statement, as set out in annex VI;
   3. Risk management framework component III – risk dashboard, as set out in annex VII;
   4. Risk management framework component IV – “Risk guidelines for funding proposals”, as set out in annex VIII;
2. Agrees that the:
   
   1. Risk management framework component I – revised risk register referred to in paragraph (a) (i) above replaces the risk register adopted through decision B.12/34;
   2. Risk management framework component II – risk appetite statement referred to in paragraph (a) (ii) above replaces the risk appetite methodology adopted pursuant to decision B.10/08 and contained in annex XXIV to decision B.10/08 (annex XXIV to document GCF/B.10/17);
   3. Risk management framework component III – risk dashboard referred to in paragraph (a) (iii) above replaces the risk dashboard adopted pursuant to decision B.10/08 and contained in annex XXIII to decision B.10/08 (annex XXIII to document GCF/B.10/17);
   4. Risk management framework component IV – “Risk guidelines for funding proposals” referred to in paragraph (a) (iv) above replaces the “Interim risk and investment guidelines for the public sector” and “Interim risk and investment guidelines for the private sector” adopted pursuant to decision B.13/36 and contained in annexes VIII and IX, respectively, to decision B.13/36 (annexes VIII and IX to document GCF/B.13/32/Rev.01);
3. Notes that the first set of components of the risk management framework as contained in annexes V to VIII complements the financial risk management framework adopted pursuant to decision B.07/05;
4. Takes note of the proposed preliminary risk dashboard in annex VII; and requests the Secretariat to further develop the risk dashboard and the underlying methodologies for consideration by the Board at its eighteenth meeting; the risk dashboard will be published every quarter thereafter;
5. Takes note of the risk rating approach as set out in annex IX;
6. Requests the Secretariat to continue with the development of appropriate risk rating models with the support from an external professional service provider and in consultation with the Risk Management Committee and present the risk rating models for consideration by the Board at its nineteenth meeting; and
7. Also requests the Secretariat to continue with the development of the risk management framework and its remaining components in consultation with the Risk Management Committee and present these for consideration of the Board at its eighteenth meeting.