The development community in general and DfID in particular have committed and will commit significant amounts of capital to low carbon development projects. Increasingly, organizations like DfID are using funds as delivery mechanisms. As a result, fund structures can and should build on existing best practices.
This report aims to help policymakers understand the mechanics of commercial and non-commercial (grant) funds. In particular, it describes the most common management, compensation, governance and operating models. It also describes some of the approaches – and issues – that arise for funds and programs in the development sector, specifically, where commercial concepts are adapted to meet scrutiny by and demands of governments and tax payers.
Development funding is inherently complex; linking it to financial outcomes, even more so. This report identifies the best practices from the commercial fund sector and analyses how to integrate them with donor requirements (and constraints) as it relates to structuring, governance, value for money, and monitoring and evaluation.
Lion’s Head Global Partners. Low Carbon Study Fund 203134-101. Fund Management/Administrator Impacts on Investment and Challenge Funds’ Value for Money, Efficiency and Results. Lion’s Head Global Partners, London, UK (2013) 79 pp.