UNEP Programme Manual May, 2013 1
Transcription
UNEP Programme Manual May, 2013 1
UNEP Programme Manual May, 2013 1 Table of Contents 1. INTRODUCTION .................................................................................................................................. 7 2. UNEP PROGRAMME OVERVIEW .................................................................................................... 8 A. B. C. UNEP’S RESULTS FRAMEWORK AND PROGRAMME CYCLE ..................................................................... 10 ROLES AND RESPONSIBILITIES IN UNEP .................................................................................................. 13 PROJECT CYCLE ....................................................................................................................................... 16 PROJECT PLANNING AND DESIGN .............................................................................................. 18 3. A. B. C. D. E. F. G. H. I. J. K. DEVELOPING PROGRAMME FRAMEWORKS ............................................................................................... 18 GETTING STARTED WITH PROJECT CONCEPTS .......................................................................................... 19 PLANNING PROJECT INTERVENTIONS: THEORY OF CHANGE ..................................................................... 22 ENGAGING WITH STAKEHOLDERS ............................................................................................................ 29 FORMULATING PROJECT RESULTS............................................................................................................ 30 PLANNING HOW TO MEASURE THE RESULTS ............................................................................................. 33 DEFINING THE PROJECT APPROACH ......................................................................................................... 37 CROSS-CUTTING ISSUES ........................................................................................................................... 40 PLANNING HOW TO OPERATE A PROJECT .................................................................................................. 42 PROCUREMENT PLANNING ....................................................................................................................... 43 DEVELOPING THE PROJECT DOCUMENT ................................................................................................... 44 REVIEW AND APPROVAL ............................................................................................................... 45 4. A. B. C. D. APPROVAL OF PROJECT CONCEPTS .......................................................................................................... 45 APPROVAL OF FULLY DEVELOPED PROJECTS ........................................................................................... 46 PROJECT QUALITY STANDARDS AND REVIEW CRITERIA .......................................................................... 47 PROJECT REVIEW PROCESS ...................................................................................................................... 49 IMPLEMENTATION AND MONITORING...................................................................................... 51 5. A. B. C. D. E. F. G. H. ROLES AND RESPONSIBILITIES ................................................................................................................. 51 STARTING PROJECT IMPLEMENTATION ..................................................................................................... 53 HUMAN RESOURCES MANAGEMENT AND TRAVEL .................................................................................... 55 STAKEHOLDER ENGAGEMENT DURING PROJECT IMPLEMENTATION ......................................................... 57 MONITORING AND REPORTING ................................................................................................................. 57 MANAGING PROJECT INFORMATION ......................................................................................................... 61 PROJECT REVISIONS ................................................................................................................................. 62 PROJECT EXTENSIONS .............................................................................................................................. 63 RESOURCE MOBILIZATION .......................................................................................................... 66 6. A. B. C. D. E. F. ROLES AND RESPONSIBILITIES ACROSS THE ORGANIZATION............................................................... 66 GENERAL PRINCIPLES FOR RESOURCE MOBILIZATION ....................................................................... 69 SOURCES OF FUNDING ............................................................................................................................ 70 PROCESSES TO MOBILIZE RESOURCES ................................................................................................... 71 INVESTING IN DONOR RELATIONS .......................................................................................................... 78 EUROPEAN COMMISSION........................................................................................................................ 79 PARTNERSHIP MANAGEMENT ..................................................................................................... 83 7. A. B. PARTNERSHIP ANALYSIS ........................................................................................................................ 84 DUE DILIGENCE ...................................................................................................................................... 85 2 C. D. E. F. LEGAL INSTRUMENTS ............................................................................................................................. 85 REVIEW AND APPROVAL OF PARTNERSHIP ........................................................................................... 89 EXECUTION OF A PARTNERSHIP AGREEMENT....................................................................................... 90 AUDIT OF PARTNERS .............................................................................................................................. 91 RISK MANAGEMENT ....................................................................................................................... 93 8. A. B. C. D. E. IDENTIFICATION AND ASSESSMENT OF RISKS ....................................................................................... 93 PLANNING MANAGEMENT RESPONSES TO RISKS .................................................................................. 95 MONITORING RISKS ............................................................................................................................... 96 PROJECT-AT-RISK SYSTEM .................................................................................................................... 96 PROCUREMENT RISKS ............................................................................................................................ 97 FINANCIAL MANAGEMENT ........................................................................................................... 99 9. A. B. C. D. E. F. HOW TO DEVELOP A PROJECT BUDGET ................................................................................................ 100 HOW TO ACCESS SECURED FUNDING .................................................................................................... 105 HOW TO PROCESS PROCUREMENTS...................................................................................................... 108 HOW TO MAKE ADVANCE PAYMENTS ................................................................................................... 110 HOW TO MONITOR FINANCIAL PERFORMANCE ................................................................................... 111 FINANCIAL MANAGEMENT OF EQUIPMENT ......................................................................................... 114 10. EVALUATION .................................................................................................................................. 117 A. B. C. D. UNEP’S APPROACH TO EVALUATION ................................................................................................. 117 TYPES OF EVALUATION IN UNEP ........................................................................................................ 118 PROCESSES OF EVALUATION ................................................................................................................ 120 MANAGEMENT RESPONSES AND RECOMMENDATIONS ....................................................................... 125 11. PROJECT COMPLETION AND CLOSURE ................................................................................... 127 A. B. C. CONFIRMING COMPLETION OF THE PROJECT..................................................................................... 127 ADMINISTRATIVE COMPLETION REVISION OF THE PROJECT ............................................................ 128 FINANCIAL AND ADMINISTRATIVE CLOSURE OF THE PROJECT ......................................................... 129 ANNEXES .................................................................................................................................................. 133 1. KEY TERMS AND DEFINITIONS .................................................................................................. 133 2. TEMPLATES..................................................................................................................................... 135 3. REFERENCES .................................................................................................................................. 137 3 LIST OF FIGURES Figure 1 – The Strategic Framework is derived from the MTS and leads to the PoW Figure 2 – From Programme of Work to projects Figure 3 – Hierarchy of UNEP’s Results Framework Figure 4 – UNEP’s matrix approach with Lead Divisions indicated for each Subprogramme Figure 5 – UNEP Programme and Project Cycle Figure 6 – A simple problem tree/situation analysis Figure 7 – The situation analysis shown in figure 6 converted into a simple objective tree Figure 8 – A simple generic causal pathway, which can be also termed Theory of Change Figure 9 – Multiple pathways within a generic Theory of Change Figure 10 – Suggested steps in developing a Theory of Change for a project Figure 11 – A simple impact pathway depicting assumptions, risks and impact drivers Figure 12 – From project concepts to project documents Figure 13 – Flow of work for approval process Figure 14 – Likelihood and impact matrix of risk analysis Figure 15 – Budget planning for results Figure 16 – Project expenditure and financial performance Figure 17 – Process of project completion and closure LIST OF TABLES Table 1 – Example of Stakeholder Analysis Table 2 – UNEP Logical Framework Structure Table 3 – Examples of SMART outcomes and outcome indicators Table 4 – Summary of roles and responsibilities in project implementation Table 5 – Complementary roles of monitoring and evaluation Table 6 – Summary of UNEP reporting requirements Table 7 – Process and requirements for project revisions Table 8 – Summary of UNEP standard legal instruments Table 9 – Standard legal instruments versus commercial contracts Table 10 – Project risk assessment table in UNEP project document Table 11 – UNEP project budget format and IMIS budget codes Table 12 – Contact points for communication on key issues during an evaluation Table 13 – Summary of roles and responsibilities in evaluation Table 14 – Types of compliance status in implementation of evaluation recommendations LIST OF BOXES Box 1 – Key Terms in UNEP’s Results Framework Box 2 – What is a Project in UNEP? Box 3 - Some Key Terms Used in Theory of Change Box 4 – Output vs. Outcome Box 5 – Types of indicators (not all mutually exclusive) Box 6 – MDG7 targets and indicators Box 7 – The Project Review Committee Box 8 – Human resources Box 9 – Travel rules of the Travel Shipping and Visa Unit in Nairobi Box 10 – European Commission funding instruments for the period 2014-2020 Box 11 – Financial and Administrative Framework Agreement Box 12 – Co-financing in UNEP Box 13 – Programme Support Costs and GEF Fees Box 14 – Roles and Responsibilities of Certifying, Approving, and Authorising Officers 4 Acronyms ACABQ UN Advisory Committee on Administrative and Budgetary Questions ADDIS ASU Advanced DGEF Database Information System Accounts Service Unit of UNON BSP Bali Strategic Plan for Technology Support and Capacity-building CCA UN Common Country Assessment CFP CPC Call for Proposal UN Committee on Programme and Coordination CPR UN Committee of Permanent Representatives CRC DCPI Concept Review and Clearance Division of Communication and Public Information DED Deputy Executive Director DELC Division of Environmental Law and Conventions DEPI Division of Environmental Policy and Information DEWA Division of Early Warning and Assessment DPC DRC (UNEP) Donor Partnerships and Contributions Section Division of Regional Cooperation DSA Daily Subsistence Allowance DTIE Division of Technology, Industry and Economics EA EC EU Expected Accomplishment European Commission European Union ED Executive Director ENRTP FMO EC Environment and Sustainable Management of Natural Resources Thematic Programme Fund Management Officer GC Governing Council GEF GEF-CO Global Environment Facility GEF Coordination Office of UNEP HACT Harmonized Approach to Cash Transfers HRBA Human Rights Based Approach ICA IPI Internal Cooperation Agreement Initial Project Idea (GEF projects) ITB LoA LoC Invitation To Bid Letter of Agreement Letter of Commitment LoI Letter of Intent LDCF LPSB GEF Least Developed Countries Fund Local Property Survey Board MEA Multilateral Environmental Agreement MGS Major Groups and Stakeholders MoU Memorandum of Understanding MTS Medium-Term Strategy 5 NEE Non-expendable Equipment NGO Non-Governmental Organization OfO Office for Operations OHRM Office of Human Resource Management OIOS PCA UN Office of Internal Oversight Services Project Cooperation Agreement PIF PIMS PM Project Identification Form Programme Information and Management System Portfolio Manager (GEF projects) PoW Programme of Work PPG Project Preparation Grant PPR Programme Performance Report PRC Project Review Committee PSC Programme Support Cost QAS Quality Assurance Section RBM Results-Based Management SCCF SMT GEF Special Climate Change Fund Senior Management Team SOW SPP Statement of Works Strategic Presence Policy SSFA SSP TM Small-Scale Funding Agreement Source Selection Plan Task Manager (GEF projects) ToR Terms of Reference TSVU UNON Travel Shipping and Visa Unit UNCT United Nations Country Team UNDAF United Nations Development Assistance Framework UNDG United Nations Development Group UNEG United Nations Evaluation Group UNEP United Nations Environment Programme UNON United Nations Office at Nairobi USD United States Dollar 6 1. Introduction In 2008, based on demand from stakeholders and within the reform context of the UN Secretariat management, UNEP introduced a results planning framework as part of a broader reform process. The four-year Medium Term Strategy (MTS) for 2010-2013 provides vision and direction for all UNEP work in this period, and sets out UNEP’s results framework. The MTS is implemented through biennial Programmes of Work (PoW). The PoW includes objectives, Expected Accomplishments and performance measures in line with MTS. In addition, the PoW includes specific outputs for which UNEP is accountable, and which together make a credible contribution to the achievement of EAs and objectives. UNEP has since implemented numerous significant changes to its operational and programme management processes. Please see the UNEP Quality Assurance Section website for more information. Annex 3 of the present document also includes a list of links to relevant policies, which were approved as part of UNEP’s reform process on these reforms. This Programme Manual replaces the 2005 UNEP Project Manual, and provides a consolidated reference for standard operating procedures and requirements applicable to all projects implemented by UNEP, including those financed by the Global Environment Facility (GEF). The programmes of work for Multilateral Environmental Agreements (MEAs) and Regional Seas Conventions do not fall under the purview of guidance in this manual. In addition, this manual does not provide detailed administrative instructions that are readily available from other sources; for this purpose a list of references is included in Annex 3. The development of this manual was led by the UNEP Quality Assurance Section (QAS), in consultation with Divisions and the GEF Coordination Office. The intended audience of this manual is UNEP staff members responsible for executing and implementing projects and managing their related accounts, as well as senior managers involved in overseeing project-related work, project team members and partners. This manual is structured around the processes and thematic areas of programme and project management. Chapters 3-5 and 10-11 follow the project cycle from planning to evaluation and closure. Chapters 6-9 present thematic areas (such as partners, risks, and resources management) which are part of the project cycle, from beginning to end. Overall, the content of this manual provides an overview of: UNEP’s results framework and its overall approach to results based management, including the Theory of Change; The respective roles and responsibilities of Task Managers, Project Managers, Fund Management Officers (FMOs), supervisors of Managers and project implementing partners; The respective roles and responsibilities of Division Directors, Subprogramme Coordinators, and other bodies that steer implementation; UNEP project quality standards and how to develop and manage a project within the standards; UNEP’s procedures for monitoring and for evaluation; and Key areas and basic requirements of operational management to ensure efficient programme and project delivery. QAS continually reviews and updates this manual. Future versions may include annexes dealing with specific topics, such as the UNEP/GEF projects cycle and standards and approved Standard Operating Procedures. Any suggestions or comments to improve this manual should be sent to: [email protected] 7 2. UNEP Programme Overview UNEP is the United Nations’ designated entity for addressing environmental issues at the global and regional levels. Its core objectives are to serve as an authoritative advocate for the global environment, to support governments in setting the global environmental agenda, and to promote the coherent implementation of the environmental dimension of sustainable development within the UN system. The mandate and objectives of UNEP mainly emanate from: 1972 UN General Assembly Resolution 2997 (XXVII); 1997 Nairobi Declaration on the Role and Mandate of UNEP; 2000 Malmö Ministerial Declaration; and 2002 Cartagena Package. The areas of work – labeled as service lines in the MTS 2014-2017 - within UNEP’s mandate also constitute its comparative advantage. They are: Catalyzing action on findings from solution-oriented environmental assessments, analyses and early warning information; Promoting the development and implementation of international environmental law; Piloting innovative approaches and testing tools, norms and methods in countries and catalyzing their uptake by others through strategic partnerships and demonstrations; Fostering transboundary collaboration and catalyzing action on the management of shared resources; and Coordinating actions of the UN on common environmental priorities to improve coherence of the UN system. UNEP achieves its mandate through its four-year MTS and PoWs, which focus on cross-cutting thematic priorities, referred to as UNEP’s Subprogrammes: Climate change Disasters and conflicts Ecosystem management Environmental governance Harmful substances and hazardous waste (Chemicals and Waste from 2014-15) Resource efficiency and sustainable consumption and production Environment under review (from the biennium 2014-15) Implementation of UNEP’s programme of work is further guided by the following key principles: Results-Based Management (RBM): RBM is a fundamental principle of UNEP’s operations, and a cornerstone of UNEP’s efforts to demonstrate results in tangible terms. Shifting the focus away from inputs and activities, UNEP emphasizes the achievement of outputs and outcomes. Bali Strategic Plan for Technology Support and Capacity-building (BSP): The Governing Council (GC) adopted the BSP in 2005, which calls on UNEP to reinforce its engagement in developing countries, and countries with economies in transition, in the fields of technology support and capacity building. Through the BSP, UNEP will increase its attention to individual country needs through strengthened technology support and capacity building across all thematic 8 areas. The BSP requires UNEP to demonstrate how countries utilize UNEP’s products and services and benefit from strategic partnerships catalyzed by UNEP. Strategic Presence Policy (SPP): UNEP’s Strategic Presence Policy (SPP) was approved in January 2009 to provide a mechanism for the effective implementation of the MTS for 2010-13. The policy states that ‘UNEP’s move towards a strategic presence model will be guided by the objective to deliver on One UNEP-wide PoW in a coherent, coordinated and integrated manner by all components of the Secretariat, in the most efficient and cost effective manner’. The SPP clarifies the roles of UNEP’s Headquarters versus its Regional Offices. The role of the latter was strengthened to lead the delivery of UNEP’s PoW in the regions. Delivering as One: In 2006, the High-level Panel on UN System-Wide Coherence recommended the Secretary-General to strengthen coherence across UN organizations by “Delivering as One.” This means UNEP’s work at the country level must be implemented in a coordinated manner among the various units within UNEP itself operating in the country, as well as with other UN agencies and organizations. UNEP’s Regional Offices are key players in UNEP’s country and regional level efforts to achieve coordination and coherence across the organization. UNEP also provides technical guidance and leadership to strengthen environmental sustainability throughout the work of the UN system, including in the UN Development Assistance Framework (UNDAF) process and UN consolidated humanitarian appeals, among others. Gender Balance: The importance of gender mainstreaming in environmental and poverty eradication policies has been recognized in a wide range of global agreements and fora, and is a key principle in UNEP’s work. The guiding document for gender mainstreaming within the organization is the UNEP Gender Plan of Action (GPA), which sets out detailed activities leading towards the full integration of gender aspects within the organization and its programmes. For more information, please visit UNEP website on Gender Mainstreaming and the Guidance Note on Gender Analysis at Project Level. Public Participation and Access to Information: In line with Principle 10 of the Rio Declaration from 1992, all UNEP activities and programmatic and policy work should be designed in a way to allow for relevant stakeholder involvement and should have a high degree of transparency. Human rights based approach (HRBA): UN agencies came together in 2003 to adopt a Common Understanding, which aims to ensure that a HRBA is applied consistently at the global, regional and country level. Inclusion of Indigenous Peoples Issues, needs and concerns. The recognition and respect for indigenous knowledge, cultures and traditional practices contributes to sustainable and equitable development and proper management of the environment. The importance of inclusion of indigenous issues in environmental policies has been internationally recognized, such as through the adoption of the UN Declaration on the Rights of Indigenous Peoples adopted in 20071. The concept of free, prior and informed consent is a goal to be pursued, and a principle to be respected to the greatest degree possible in UNEP planning and implementation. ----- 1 For more information and key documents supportive to project development and implementation with indigenous peoples and their communities, please consult the UNDG guidelines on Indigenous Peoples, the UN Resource Toolkit on Indigenous Peoples issues and the draft UN REDD guidelines on Free Prior informed consent. 9 Global Environment Facility (GEF): In 1991, UNEP, UNDP, and the World Bank came together to form the Global Environment Facility (GEF), with the Secretariat to the partnership based in Washington, DC. Today the GEF is the world’s largest funder of projects to achieve global environmental benefits through incremental financing. The GEF allocated $8.7 billion in new grants between 1991 and 2010 in more than 165 developing countries and countries with economies in transition. The GEF Trust Fund is replenished every four years, and a “GEF Programming Framework” is agreed to at the beginning of the four years by the GEF Council and GEF Assembly. This is the equivalent of the MTS for GEF projects. For more info on the GEF see the UNEP/GEF and GEF website. UNEP projects applying for GEF co-funding are subject to the policies and rules of the GEF, which have been largely harmonized with rules and guidelines of UNEP projects. Each UNEP Division houses technical and financial experts who are dedicated to the development, implementation and oversight of GEF projects, and manage the portfolios relevant to the divisions. Other UNEP staff can be called upon to assist or lead in such activities. The “blending” of GEF and non-GEF financing into one coherent project/output is encouraged. The GEF Coordination Office provides overall coordination and strategic guidance on the GEF Operations. a. UNEP’s Results Framework and Programme Cycle The development of UNEP’s programme cycle begins with planning a four-year Medium Term Strategy (MTS) and constituent biennial PoWs. OfO leads, together with Subprogramme Coordinators, the development of these strategic plans, in consultation with Divisions and Regional Offices. The process requires several rounds of reiteration to ensure that the MTS and PoW are informed from global environmental assessments and regional and country needs. There are also successive reviews by UNEP Senior Management Team (SMT). The MTS and PoW are then implemented through projects and monitored in terms of coherent and effective delivery at the programme level. Each MTS and PoW planning process builds upon lessons learned and results of programme evaluations from previous processes, as part of the cycle of institutional learning and analysis. UNEP’s MTS is a strategic document that guides programme planning over a four-year period. The MTS is developed through an extensive consultation process, which examines major global environmental challenges and trends and analyzes UNEP’s comparative advantage against these challenges. The main product of the MTS is the identification of thematic priorities, known as Subprogrammes, supported by clearly defined objectives and strategies to achieve those objectives. The MTS also sets out EAs for each Subprogramme, which are the desired outcomes of the SP (see Box 1 below for key terms in UNEP’s Results Framework). The MTS is reviewed by the UNEP Committee of Permanent Representatives (CPR) and thereafter the UNEP Governing Council (GC).2 Strategic Frameworks lay out what UNEP will aim to deliver in each two-year biennium of the MTS. UNEP develops one Strategic Framework for each Subprogramme, where performance indicators for each of the related EAs (from the MTS) are defined. Normally there are two to three EAs connected to a Subprogramme. The UNEP Strategic Framework is reviewed by the UN Committee on Programme and Coordination (CPC), the UN body responsible for ensuring coordination of the UN’s 2 The GC is UNEP’s main governing body and the CPR is a subsidiary body of the Governing Council, made up of government representatives who are based in Nairobi. 10 planning and programming, to ensure coherence between different UN programs. UNEP Strategic Frameworks are: Strategic Framework 2010-2011 Strategic Framework 2012-2013 Strategic Framework 2014-15 (as submitted to the CPC in June 2012) The priorities and objectives developed in the MTS and associated biennial Strategic Frameworks are translated into biennial Programmes of Work (PoW). The PoW is the programming document of UNEP that describes specific outputs for which UNEP is accountable, and the resources required for their delivery, which in turn contribute to the achievement of EAs. The PoW is first reviewed by the UNEP CPR, then by the UN Advisory Committee on Administrative and Budgetary Questions (ACABQ) - a UN body in New York responsible for reviewing budgetary and administrative aspects of the PoW -, and subsequently by the UNEP Governing Council. The ultimate approval is from the General Assembly (Fifth Committee) as part of the UN’s broader programme plan. Programme of Work 2010-2011 Programme of Work 2012-2013 Programme of Work 2014-2015 Figure 1: The Strategic Framework is derived from the MTS and leads to the PoW Vision Priorities Expected accomplishm ents GC approval Programmes of Work (2 years) Strategic Frameworks (2 years) MTS Strategy (4 year) to guide Subprogrammes (MTS Priorities) Expected accomplishments with indicators Strategy External factors to guide CPC approval Subprogrammes (MTS Priorities) Objectives with indicators Expected accomplishments with indicators (including baselines and targets) Strategy External factors Outputs Budget ACABQ, GC, GA approval Box 1: Key Terms in UNEP’s Results framework Results are changes in a state or condition which derive from a cause-effect relationship. There are three types of such changes (result levels) which can be set in motion by a development intervention: Output: products and services which result from the completion of activities within an intervention. Outcome: intended or achieved short-term and medium-term effects of an intervention’s outputs, usually requiring the collective effort of partners. Outcomes represent changes which occur between the completion of outputs and the achievement of impact. Outcomes could be a change in capacity (immediate outcome) or behaviour (medium-term outcome). Impact: positive and negative, primary and secondary, lasting and significant effects contributed to by an intervention. In UNEP, these effects usually concern the environment, and how it affects human life and livelihood. UNEP Programme level Project level PoW Output Project output Outcome Expected Accomplishment Project outcome Impact Subprogramme Objective Project impact Output 11 From the EAs and POW Outputs specified in the PoW, UNEP develops Programme Frameworks, to spell out what projects should be planned to deliver on the POW objectives and the EAs. UNEP uses Programme Frameworks to strengthen the causal logic between planned projects, their intended results, and programme objectives. Programme Frameworks should: Identify the projects that contribute to each EA; Set out the strategy and causal logic between project concepts, PoW Outputs, the EA(s) and higher level results; Identify important synergies and linkages that will be necessary among projects, and promote communication and cooperation among Divisions and Regional Offices; Identify resource needs and potential funding sources to achieve the EA(s); Identify important strategic partnerships relevant across projects for achievement of the EA(s); and Map the portfolio of ongoing and planned GEF projects against the EAs and Outputs, showing how they contribute to achieving the targets. Each Programme Framework includes project concepts (see section 3B), and show how planned project outputs and outcomes will lead to the achievement of the EA. Figure 2: From Programme of Work to projects ▪ ▪ ▪ ▪ ▪ ▪ PoW Subprogrammes Expected accomplishments with indicators Strategy External factors Outputs Budget GC Approval to guide Programme Frameworks (by EA) • Maps what projects are needed to achieve Expected Accomplishments • Contains Project Concepts • Facilitates Resource Planning • Fundraising tool to guide Projects SMT approval Projects are the “building blocks” that operationalize UNEP’s achievement of results in the PoW and Programme Frameworks. Projects involve a series of activities aimed at bringing about clearly specified outputs that contribute to outcomes within a defined time-period and budget, all of which is described in the Project Document (see Chapter 3 Section K). Projects may deliver parts of one or more PoW outputs, and contribute to one or more EAs, but only one PoW Output and one EA to which the project is contributing primarily need to be chosen for reporting purposes. 12 Box 2: What is a Project in UNEP? A project is a planned set of coordinated and interlinked activities to deliver agreed outputs over a fixed time period and within certain cost and other limitations. These outputs are expected to contribute to outcomes and impact. UNEP projects can vary significantly in their expected outcomes, scope and scale. Smaller projects might involve modest financial resources and last only a year or so, whereas a large project might involve many millions of dollars and last for many years. For example, a project could be a regional climate change adaptation initiative with the aim of achieving a change in the way a transboundary ecosystem is managed in the face of climate change, and costing USD 3 million over four years. Another project could focus on hazardous waste management with the aim of developing norms related to the use of lead in paints, and phasing-out of leaded paints in four pilot countries replicated through selected partners working with UNEP over a two-year period. Projects normally involve legal agreements between UNEP and external partners in order to achieve the project’s expected outcomes. GEF projects and programmatic approaches fall into this category. Figure 3: Hierarchy of UNEP’s Results 4-year MTS Subprogramme Objective Outcomes Expected Accomplishments i.e. Outcomes Projects Programme of Work (PoW) Outputs b. Roles and Responsibilities in UNEP Activities In 2009, the UNEP Executive Director announced a new matrix in which UNEP’s six 3 thematic Subprogrammes cut across the organizational structure to maximize capacity and expertise, by encouraging different Divisions and Regional Offices to work together to achieve common thematic objectives. Each Subprogramme has a Lead Division Director to which overall accountability is assigned. The Lead Division Director’s main role is to ensure programmatic coherence in the design and implementation of the Subprogramme, and that the defined outputs and projects will lead towards the achievement of the EAs and make credible contributions to the programmatic objectives. 3 A 7th Subprogramme on “Environment Under Review” will be created starting from the biennium 2014-15. 13 Figure 4: UNEP’s matrix approach with Lead Divisions indicated for each Subprogramme DRC DTIE Subprogramme 2: Disasters and Conflicts Subprogramme 3: Ecosystem Management Subprogramme 4: Environmental Governance DEWA DELC DEPI DCPI Subprogramme 1: Climate Change Subprogramme 5: Harmful Substances and Hazardous Waste Subprogramme 6: Resource Efficiency, Sustainable Consumption and Production = Lead Division A Subprogramme Coordinator is appointed to ensure the development and implementation of a coherent and strategic programme in each of the priority areas. The Subprogramme Coordinators work under the supervision of the Director of the Lead Division; however their work spans across all Divisions to ensure an integrated and strategic approach to programme development. The Subprogramme Coordinator is primarily responsible for: facilitating the development of a Programme of Work that cuts across all Divisions in UNEP in the relevant priority area; facilitating a coherent implementation of activities across divisions to achieve measurable results for the Subprogramme, and; ensuring that implementation enables UNEP’s ability to achieve results expected at the end of the biennium (See Subprogramme Coordinators’ terms of reference for the development and implementation of the 2010-2011 PoW). It is envisaged that, from 2014 onwards, Regional Offices will host regional focal points, who serve similar functions at the level of each region, under the supervision of the Regional Director and with a second reporting line to the Subprogramme Coordinator. The Project Manager4 is a staff member of UNEP assigned by the Division managing the project to have overall responsibility for executing the project on behalf of UNEP. Project Managers are responsible for ensuring that projects contribute to PoW Outputs, and for monitoring and reporting on project progress, particularly on project milestones’ delivery status. Under the coordination of the Division of Regional Cooperation (DRC), the Regional Offices are responsible for leading the coordinated delivery of the PoW at the regional level, including helping to mobilize resources. UNEP has a limited country presence, and Regional Offices therefore play a crucial role in programme implementation by ensuring coherence among UNEP activities across 4 GEF projects distinguish between Task Manager, who are assigned with the supervision and oversight of projects, and Project Managers, who deal with the day-to-day management of project activities. Please refer to Annex 1 for the distinction between “execution” and “implementation” of projects according to GEF terminology. 14 regions and countries, ensuring those activities respond to country needs and priorities, and ultimately that project outputs can be up-scaled through the best placed partners operating regionally and nationally. In addition, Regional Offices contribute to programme planning. They are best-placed to determine the geographical focus for projects in the planning phase, and engaging and establishing contacts with potential in-country partners, including UN Country Teams (UNCTs). The UNEP Strategic Presence policy paper “Moving Forward with Strategic Presence 2010-2013” provides detailed guidance on UNEP’s approach to deploying resources to regions and countries, and on the role of Regional Offices vis-à-vis Headquarters Divisions. The Programme Accountability Framework 2010-2011 clarifies roles and responsibilities within the organization, and provides guidance on who is accountable for what in the delivery of the MTS and PoW. Division Directors and Regional Office Directors and other senior managers are provided with Delegations of Authority (DoA) 5 from the Executive Director, with clear accountability and reporting obligations, to enable decision-making at the lowest appropriate level, for project, budget and administrative management. The Office for Operations (OfO) is responsible for enhancing corporate accountability, including by issuing new delegations of authority and undertaking essential compliance, oversight and reporting. It defines and maintains the approval processes for all programme planning and execution documents, such as projects and legal instruments, and coordinates and services UNEP work in relation to oversight bodies such as OIOS and the United Nations Board of Auditors. OfO provides corporate support services to UNEP, and comprises various sections: Quality Assurance Section (QAS): leads UNEP's overall strategic planning and RBM processes. QAS also takes the institutional lead in establishing standards for programmes and projects, ensures quality in UNEP’s programme and project review processes, as well as in UNEP’s monitoring processes by analyzing programme performance; acts as the secretariat for UNEP’s programme and project review committees, and builds project management capacity in UNEP. From 2012, QAS lead UNEP’s annual quality of project management and supervision review, and also started monitoring performance against the authorities delegated to Divisions and Regional Offices. Donor Partnerships and Contributions Section (DPC): leads UNEP’s efforts to mobilize contributions to the Environment Fund from governments, and provides advice and support to project managers to support extra-budgetary project-level resource mobilization from corporate and governmental donors in cooperation with Divisions and Regional Offices’ staff members. Legal Services: provides legal advice to Divisions and Regional Offices on partnership agreements Finance Human Resources IT These three Units (previously collectively labeled as Corporate Services Section) are responsible for the strategic management of UNEP budgetary, financial, human, information technology and physical 5 http://www.intranet.unep.org/index.php?option=com_content&view=category&layout=blog&id=1352&Itemid=674 15 resources. They work in close cooperation and coordination with the United Nations Office at Nairobi (UNON), which provides services to UNEP in respect of: accounting, payroll and payments, recruitment and staff services, staff development, network and other systems administration, procurement and inventory maintenance. The GEF Coordination Office provides corporate support to the GEF operations, including providing the central hub for all project submissions and communications with the GEF. It maintains coherence in relationships with the GEF Council, GEF Secretariat, GEF Agencies and other bodies within the GEF Partnership. It also hosts the Scientific Technical and Advisory Panel of the GEF (STAP). GEF Operations mirrors the PoW structure above. Each Focal Area6 portfolio is overseen by a Lead Division, which houses the Portfolio Managers (PM). These are staff who carry out the “Implementing Agency” (IA)7 functions as required by the GEF, coordinate each portfolio, manage pipelines of projects, ensure synergies with the PoW of UNEP, and provide technical input into policies and strategies. The PMs work closely with Subprogramme Coordinators. Each Lead Division also houses the Task Managers and Fund Managers who carry out the day to day oversight, supervision and fund administration of projects. Task Managers can be co-located in Regional Offices, where one staff member is chosen to be a GEF Regional Focal Point, to carry out the function of liaising with governments and clients and helping to maintain coherence in the overall portfolio at the regional level. Contributing Divisions work with the Lead Divisions either in the capacity of co-IA divisions, or as executing divisions for directly executed projects. c. Project Cycle Projects are the operational vehicle for implementing UNEP’s PoW, and follow a sequential (sometimes overlapping) series of phases known as the project cycle. The project cycle provides an overview of project management and helps Project Managers identify decision-making criteria and procedures at each phase. As illustrated in the Figure 5 below, the project cycle can be divided into the following phases within the programme cycle: Planning: In this phase new projects are planned, requiring interaction with relevant stakeholders, and decision on details of project design (e.g., project approach, agreement on planned results, budget, and activity schedule) (See Chapter 3: Project Planning and Design) Review and Approval: In this phase, project design is scrutinized for quality, and formal approval to initiate project implementation is obtained (See Chapter 4: Review and Approval) Implementation and Monitoring: During this phase, project activities are performed as planned in the project document, and changes are made as necessary. UNEP projects have clear milestones8 for the duration of the project. The Project Manager measures and reviews 6 Biodiversity, Climate Change (Mitigation and Adaptation), Chemicals, International Waters, Land Degradation, Sustainable Forest Management / REDD+, Ozone Layer Depletion 7 GEF Agencies are responsible for creating project proposals and for managing GEF projects. The GEF Agencies play a key role in managing GEF projects on the ground; more specifically, GEF Agencies assist eligible governments and NGOs in the development, implementation, and management of GEF projects. GEF Agencies are requested to focus their involvement in GEF project activities within their respective comparative advantages. In specific cases of integrated projects that include components where the expertise and experience of a GEF agency is lacking or weak, the agency is invited to partner with another agency and to establish clear complementary roles so that all aspects of the project can be well managed (GEF Instrument, Paragraph 28) 8 A milestone is a scheduled event representing progress towards the achievement of project outputs and outcomes, and a benchmark against which the progress of the project will be measured. 16 the progress of project performance, in consultation with the rest of the project team and stakeholders. Project Managers may need to take corrective management actions to re-direct the project towards desired results. Key in project management is the adequacy of corrective actions taken (and documented) to ensure the project is on track. (See Chapter 5: Implementation and Monitoring) Evaluation: During this phase, the project is reviewed and an assessment is made on whether the project achieved the results planned. The findings and recommendations from project evaluations contribute to the evaluation at programme level (See Chapter 10: Evaluation) Completion and Closing: During this phase, all project activities are finalized. The project and relevant contractual obligations are formally closed. (See Chapter 11: Project Completion and Closing). Figure 5: UNEP Programme and Project Cycle Programme Planning (Using MTS and PoW) Programme Evaluation UNEP Programme Implementing and monitoring programme PROJECTS Project Planning Review and Approval Implementation and Monitoring Project Evaluation Completion and Closing Lessons Learned The actual duration of each phase of the project cycle may vary, depending on the project size, scope, and approach. For example, a large UNEP project may require nine months only for a project feasibility study and detailed planning, while an emergency assistance project (such as short-term technical environmental assistance for emergency relief activities) may require only a few weeks to start the project running. It is the responsibility of Project Managers to secure funding for approved project concepts and they should plan the use of a proportion of such funds to better plan the project. Directors of Divisions and Regional Offices should make project preparation funding available to Project Managers to enable their staff properly plan projects in consultation with external stakeholders and partners. It is however foremost the Project Manager’s responsibility to identify suitable funding sources for projects to be developed as a contribution to the approved PoW. The GEF establishes deadlines for project preparation (also called milestones) according to the size of the project. Projects which are worth less than USD 1 million in GEF grants are expected to be prepared within 12 months; those worth more than that, within 18 months. The GEF provides project preparation grants (PPG) once the project concept (or project identification form – PIF) is cleared or approved by the GEF Chief Executive Officer. 17 3. Project Planning and Design a. Developing Programme Frameworks UNEP is moving away from implementing isolated projects towards maintaining a cohesive portfolio of projects that relate to broader strategic objectives, and together create greater impact than the sum of the individual projects. Programme Frameworks represent the link between the MTS/PoW and the projects. As a consequence, all UNEP staff is expected to contribute, in one way or another, to the respective Subprogrammes of the Programme of Work. During the PoW planning phase, two-year Programme Frameworks are developed for each of the Subprogrammes. Each Programme Framework is designed to achieve one EA, or a limited number of closely related EAs, from the MTS, and includes a set of project concepts that are needed to deliver the EA(s). During the development of Programme Frameworks, UNEP identifies linkages needed between projects to deliver the PoW, and to ensure that the results planned are not only feasible, but also achievable in the most effective manner, drawing from the strengths of different parts of UNEP and its partners. Subprogramme Coordinators are responsible for ensuring coherence, synergy, and efficacy between project concepts within the Subprogrammes. Subprogramme Coordinators are also responsible, in collaboration with GEF PMs, for ensuring coherence, synergy and complementarity between the POW and the GEF portfolio. All GEF projects, either directly executed by UNEP or executed by an external partner, must be linked to one Output in the PoW. UNEP budgets for the respective outputs can be counted as co-financing for GEF projects, but Subprogramme Coordinators must ensure that there is no double counting or duplication of effort, and that a core amount of non-GEF resources (EF and other extra-budgetary) is used to deliver a given PoW Output, with the GEF funding providing additional value and funds to what UNEP is already funding with its own resources. Comprised of the associated project concepts, a Programme Framework should describe the following: Programme Framework Logic: How the sum of the projects in the Programme Framework will contribute to the associated EA(s); How the projects fit within UNEP’s service lines and therefore comparative advantage; How new project concepts, together with projects currently under implementation, come together to deliver the associated EA and PoW outputs (causality must be explicitly addressed); Dependencies (timing-related or otherwise) or synergies among projects concepts within the Subprogramme; How to build complementarities with, or add value to, the results of past and/or current GEF funded projects; Total Framework budget: Estimate resource requirements and potential sources for the Programme Framework (covering Environment Fund, regular budget, extra-budgetary funding and any GEF- financed or Multilateral Fund contributions). Key Actors in the field and Programme Framework partnerships: Identify important strategic partnerships relevant across projects for achievement of the EA(s); Internal management arrangements and reporting requirements Subprogramme Coordinators lead a consultative process, through which the Programme Framework is put together in consultation with other Divisions and Regional Offices. Regional Offices have a specific role in providing guidance with regard to regional, sub-regional and national needs and 18 priorities (including environmental vulnerability affecting country development, commitment of Government(s), as also emanating from regional forums, UNDAFs, etc.) and matching them with UNEP’s services. For project concepts designed at the global level, consultation with Regional Offices is therefore necessary at an early stage in the design process to ensure that the project concepts are responsive to such needs and that the most relevant countries are selected. Regional Offices will also advice on how the projects can be anchored in the relevant UN Common Country Programming Processes to ensure coherence (One UN and One UNEP approach) and on partnership building at regional and national level. Likewise, for project concepts designed at the regional level, the Division of Regional Cooperation (DRC) and Regional Offices will draw upon technical expertise of the Headquarters Divisions. b. Getting started with Project Concepts Programme Frameworks are developed to demonstrate the intended contribution of each project to the MTS and PoW. At this point, initial ideas for projects are conceived in the form of project concepts. The project concepts identified in the Programme Framework must be accompanied by a succinct narrative on the intended project outcome and how it fits within the relevant EA(s) and the Subprogramme. The project concept should consider the project’s relevance and expected benefits to stakeholders, and the feasibility and sustainability of the project’s outcomes. Taken together, the project concept presents the business case for the project. It may be used to solicit funding from potential donors, and therefore should make a clear and compelling case for why the project should be funded. See this example of a compelling business case for a proposed UNEP project. Still using the standard Programme Framework template, the project concepts should provide the following information: Project objective: The project outcomes and outputs should be each stated in one sentence, and how these outcomes are related to the relevant EA(s) and Subprogramme Objective(s) is to be explained. The outcomes that one single project will be expected to contribute to should be one, or very few in number and realistic; Project idea and approach, including: Brief description of the project idea, key outputs written as project outputs, and the overall approach to be taken; Socio-economic and developmental challenges and opportunities the project will address or build upon, e.g. competing economic and development issues; Description of how the project will build on UNEP’s comparative advantage (See Chapter 2); Justification of the project’s relevance in relation to national and/or regional development and/or economic priorities; Description of how the project fits with existing UNEP and/or UN projects in the country(ies) or region(s) concerned; Project’s roles and responsibilities: Potential project implementation structure and potential roles of participating Divisions and Regional Offices. Resource requirements: Indicate a realistic estimate of resource and budget needs, expected donors, likelihood of funding;9 9 In case funds are not entirely secured, the project concept should indicate what is the strategy for mobilizing resources, and – in case funds are not mobilized – what the exit strategy will look like. 19 GEF project concepts that are included in the Programme Framework Document should use the GEF template for Project identification Forms (PIF), which covers all of these aspects and more. Each project concept is listed under one EA and the most relevant PoW output, based on the dominant outcome and outputs of the project, although it may contribute to additional EAs or PoW outputs. This allows focused delivery and reporting on the PoW. If a proposed project contributes to more than one PoW output, EA or Subprogramme, the Subprogramme Coordinators and Division Directors should identify the most relevant outpus, EA and Subprogramme. Linkages should be established in the design of the projects to ensure that different projects across Subprogrammes can leverage actions from each other. Once a project concept has been approved by the Senior Management Team as part of a Programme Framework, or in exceptional cases as a separate project concept (that may have been submitted to OfO for SMT clearance after the Programme Framework was approved), the responsible Division or Regional Office develops each project concept into a fully detailed project document. Division Directors or Regional Office Directors should plan for a project preparation phase with a devoted budget, where the project approach and well defined expectations are spelled out, before the start of the project. The UNEP Project Preparation Proposal Template can be used for such project preparation phases, and project preparation budgets may be approved by Division Directors following consultation with OfO/QAS as long as the budget is small enough that it falls within their delegated authority 10 . In the unusual case that the project preparation budget would exceed the delegated authority of the Division Director, the project preparation proposal and budget should follow the same approval process as fully developed projects. For this purpose, GEF projects should use the GEF PPG template. The grants are approved by the GEF CEO after submission through the GEF Coordination Office. GEF projects are primarily country-driven and conceived through a demand driven process. Proponents contact UNEP to seek assistance in preparing and submitting the projects. UNEP participates in national GEF planning exercises to help countries identify the right Agency for a project. However, projects can also be conceived through strategic partnerships or regional needs assessments, much as with other UNEP projects. In all cases, the Task Manager conducts an assessment of eligibility, viability, and fit with UNEP comparative advantages, before agreeing to take on the project. Lead Division Directors hold frequent “Initial Project Idea” (IPI) review and clearance discussions with the GEF Coordination Office so as to maintain coherence in the overall portfolio. Task Managers should not invest too much of their time upfront with the proponent on project preparation unless the project has passed the IPI stage. The approach to GEF projects is primarily based on the concept of achieving global environmental benefits (GEB), through incremental financing. GEF projects fit along a continuum of interventions that are categorized into three types: ▪ Foundational projects: most countries need to be enabled with capacity building measures so as to have a baseline on which investments can be delivered and have impact. Such projects address the governance frameworks (commitments to MEAs through Enabling Activities; administrative 10 http://www.intranet.unep.org/index.php?option=com_content&view=category&layout=blog&id=1352&Itemid=674 20 ▪ ▪ reform; policy, legal, fiscal frameworks and incentives), help to assess environmental stress and barriers to lifting the stress (through assessments, inventories and stocktaking, as well as targeted research on innovative ideas), and disseminate knowledge and ensure access to information through awareness raising and public participation in decision making. These projects can be global, regional or national. Pilot and demonstration projects: we may have some, but not all, of the means by which we could address global environmental stress and their barriers, and often there is a need to pilot new approaches for emerging issues, or demonstrate existing best practice adapted to a country or context. This can include technology transfer, financial mechanisms for sustainability of actions, and removal of identified barriers that are related to institutional arrangements, technical knowhow or equipment, lack of capacity and market disincentives or perverse subsidies. Most often these projects are local, national or regional in scope. Investment projects: these projects take the lessons from the pilots and demos, building on foundations and enabling activities, to achieve long term catalytic change. They mainstream upscale and replicate successful solutions. They also include “pre-investment” strategies focusing on encouraging private sector investment. UNEP normally partners with a development bank for a project that works along the pre-investment to investment continuum. GEF provides grants to various types of projects ranging from several thousand dollars to several million dollars. These are: ▪ ▪ ▪ ▪ ▪ Full-size Projects - Over USD 2 million - Project concepts must respond to both national priorities and GEF focal area/Least Developed Countries Fund/Special Climate Change Fund strategies and objectives, and must satisfy eligibility requirements under the Conventions. Project proponents work closely with national GEF Operational Focal Points (who formally endorse project concepts) and the GEF Agency, to develop concepts and move through the project cycle. Medium-Size Projects - Up to USD 2 million - They offer opportunities for a broad range of programming that is typically smaller in scale than full-sized projects and follow expedited procedures for their approval. Their approval is delegated by the Council to the CEO, and it is subject to Project Review Criteria , similar to full-scale project. Following CEO approval, the project document will be approved by the Agency following its own procedures, followed by the start of project implementation. Enabling Activities: The GEF finances Enabling Activities related to the conventions on biodiversity, climate change, and persistent organic pollutants, to help countries prepare national inventories, strategies, action plans, and reports under these conventions Enabling Activities that go beyond the threshold are considered non-expedited, and follow the procedures for processing full-sized projects. Programmatic Approaches: they represent a partnership between country/ies, the GEF and other interested stakeholders, such as the private sector, donors and/or the scientific community. This approach secures larger-scale and sustainable impact on the global environment, than a single FSP or MSP, through integrating global environmental objectives into national or regional strategies and plans using partnerships. A program usually contains several projects that are linked through common objective/s of the program aimed to foster increased horizontal and vertical integration of global environmental issues into the country(ies) development agenda. Small Grants Programme: Up to $ 50,000 - Funded by GEF as a corporate programme, the Small Grant Programme is implemented by UNDP on behalf of the GEF partnership, and is executed by the United Nations Office for Project Services (UNOPS). The Small-Grant Programme supports non-governmental and community organizations, providing small grants for community-based projects in the GEF focal areas. 21 c. Planning Project Interventions: Theory of Change Once the scope, problem, and approach has been decided, project logical frameworks (see section below), are an extremely useful tool for summarising project interventions, specifying performance indicators and documenting key assumptions. However, they do not readily capture comprehensive information on the processes by which project outputs yield outcomes and eventually lead to impacts and the associated risks. To ensure that project logical frameworks are well designed, all project design processes must: 1. Undertake a problem tree or situational analysis; 2. Convert this into a simple ‘objective tree’; 3. Determine the intervention logic and develop it into a detailed Theory of Change; 4. Summarise the key activities, results levels and performance indicators from the Theory of Change in a logical framework matrix. All UNEP projects are subject to this design process. For GEF projects, there is as well the need to conduct an “incremental cost analysis”, where the additional nature of the GEF financing is mapped out. GEF projects build on a “baseline scenario” to provide incremental financing to achieve an “alternative scenario”. Situation or Problem tree analysis Situation or ‘problem tree’ analysis is central to results-oriented project planning and helps in the design of effective interventions by mapping out cause and effect relationships around an issue or problem in a structured way. See this website for more info. This brings several advantages: The problem can be broken down into manageable and definable ‘chunks’. This enables a clearer prioritization of factors and helps focus objectives; The analysis, especially when undertaken collaboratively with stakeholders, promotes shared understanding of the problem and its often interconnected and sometimes multiple causes. This can be an important step in finding win-win solutions; It identifies the constituent issues and arguments, and can help establish who and what the actors and processes are at each stage; It can help establish whether further information, evidence or resources are needed to make a strong case, and build a viable solution; The process of analysis often helps build a shared sense of understanding, purpose and action. 22 Figure 6: A simple problem tree / situation analysis Catch and income of fishing families in decline Effects River ecosystem under serious threat including declining fish stocks High incidence of water borne diseases and illness among poor families and under 5s River water quality deteriorating High quantities of solid waste dumped into river by riverine communities & industry Population not aware of the danger of waste dumping Government & civil society have no public information programs Polluters not controlled Problems Most households and factories discharge waste water directly into river Legal regulations inadequate to prevent direct discharge of waste water Polluters not publically disclosed Environment Protection Agency incapable of controlling polluters and closely aligned with industry interest Pollution is low political priority for central government 40% of HHs and 20% of businesses not connected to sewerage network Inadequate levels of investment in sewage infrastructure and poor planning by local govt. Causes The ‘problem tree’ can be converted into an ‘objectives tree’ by rephrasing each of the problems into positive desirable changes. In this way, root causes and consequences are addressed in the proposed solutions, and the causal logic and key partners / actors can more readily be identified. Figure 7: The situation analysis shown in Figure 6 converted into a simple objective tree Catch and income of fishing families stabilized or increased Ends Threat on river ecosystem reduced including recovering fish stocks Lower incidence of water borne diseases and illness among poor families and under 5s River water quality is improving Less solid waste dumped into river by riverine communities & industry Population aware of the danger of waste dumping Polluters controlled Polluters publically disclosed Government & civil society conduct public information programs Environment Protection Agency is capable of controlling polluters and responsive to a broad range of stakeholder interests Solutions Less households and factories discharge waste water directly into river Legal regulations are adequate to prevent direct discharge of waste water Pollution is political priority for central government Lesser % of HHs and businesses not connected to sewerage network Adequate levels of investment in sewage infrastructure and improved planning by local govt. Means Developing a more detailed Theory of Change A key part of project design is to identify the sequence of activities, conditions, factors and actors necessary for a project to achieve the desired outcomes. Description of the relationships between a project’s activities and the desired results can be variously described as ‘Theories of Change’, ‘Impact Pathways’, ‘Results Chains’, and ‘Causal Pathways’ (to name only some!). Figure 8 shows a generic ‘causal pathway’ which links the standard elements of project logical frameworks in a graphical representation of causal linkages. When specified in detail - for example 23 including the key users of outputs, descriptions of the processes (the arrows) that lead to outcomes, and with details of performance indicators - they can be invaluable as a tool to improve project planning, monitoring of progress towards results, identification of risks and later evaluation. Figure 8: A single generic causal pathway, which can also be termed Theory of Change Project activities Assumption Assumption Project output Project activities Project activities Outcome (EA) Intermediate state Impact Project output Driver Project activities or outputs Driver Project activities or outputs A key point to note in Figure 8 is that project activities and outputs are needed to help achieve the results also at higher result level (outcome, intermediate state, impact). Monitoring of project milestones should therefore chart progress from the initial activities to the key outputs and onwards towards outcomes and, eventually, contributions to Subprogramme objectives. Whilst Figure 8 shows one causal pathway, many real-life problems are addressed through several related causal pathways as indicated in Figure 7 and, generically, in Figure 9 below. Figure 9: Multiple pathways within a generic Theory of Change Figure 9 provides a generic example of a set of related causal pathways, and highlights the fact that there are ‘change processes’ linking project outputs to the desired higher level results. Note that more than one output and change process may be required to achieve a certain outcome or, conversely, one output may lead to more than one outcome (via different change processes). In addition, there may be additional stages (termed ‘intermediate states’ in the diagram), between the immediate project outcome and the desired objective. The figure shows six different pathways from the outputs to the objective, but activities to produce outputs and promote ‘change processes are not shown. 24 Very often a project may be able to undertake activities to increase the likelihood that desired changes will happen. However, it is seldom the case that a project will entirely control the ‘change processes’ that occur beyond the production of outputs. For example, there is much a project can do to increase the likelihood that an output is used (training, awareness-raising, demonstrations etc.). However, the project does not control the decision of the target audience to actually start using a particular output, nor does the project control the consequences that stem from its use. A further step in developing a Theory of Change is to consider the ‘actors and factors’ that may either promote or inhibit the various change processes identified. This will lead to the identification of the activities a project needs to consider to increase the likelihood that the desired changes will happen (drivers) and also helps to identify the assumptions or risks. Figure 11 at the end of this section shows how pathways can be analyzed in terms of the ‘assumptions’ and ‘drivers’ that underpin the processes involved in the transformation of outputs to outcomes and objectives via intermediate states. One pathway from Figure 7 was chosen for the example. Box 3: Some Key Terms Used in Theory of Change (see also Box 1) Intermediate states are the higher level changes (outcomes) between the project’s immediate outcomes and the intended impact or goal of the project. They are necessary conditions for the achievement of the intended impacts and there may be more than one intermediate state between the immediate project outcome and the eventual impact. Drivers are defined as the significant factors that, if present, are expected to contribute to the realization of the intended outcomes, intermediate states or impacts and can be influenced by the project / project partners & stakeholders. Assumptions are the significant factors that, if present, are expected to contribute to the realization of the intended outcomes, intermediate states or impacts but are largely beyond the control of the project / project partners & stakeholders. Assumptions are often positively formulated risks. E.g. Decision makers championing the cause of the project within the Government remain in place over the course of the project. Risks are uncertain events or conditions which, if they occur, can have an adverse effect on the realization of the intended results, but are largely beyond the control of the project / project partners & stakeholders. Risks are often negatively formulated assumptions. E.g. Project champions within Government are replaced by decision makers that are unfavorable to the project cause. Choosing the outcomes, outputs and activities on which the project will focus is called determining the intervention logic or intervention strategy of the project. Depending on the resources and time available to the project team, the project might be able to cover several causal pathways towards impact, or only one. The choice of which pathways will receive the project’s main focus, i.e. the choice of the intervention logic of the project, will then be made in function of several factors, such as: The UNEP overall mandate, service lines, Subprogramme objectives and Expected Accomplishments as set out in the Medium-Term Strategy. Outcomes that cannot be linked to an Expected Accomplishment should be considered as drivers (in case the project will still influence them) or assumptions (in case the project will not influence them). In the case of GEF projects, the relevant GEF Strategic Framework has to also be complied with; Government and other stakeholders’ priorities, including also donors. 25 The technical expertise and experience of UNEP and, in particular, the project team; whether other stakeholders (Government agencies, other international development agencies, private sector, major groups11, etc.) are already contributing to certain causal pathways. The idea here is to look for complementarities and to avoid duplication, but also to maximize potential synergies, and; The “weight” of the causal pathway in its potential contribution to the expected impact. If only a few among many pathways can be covered, we would choose – resource and time requirements being equal – these pathways with the highest possible contribution to impact. The process of identifying the intervention logic of a project should preferably be done as a group exercise, led by the lead designer with a cross-section of project stakeholders. The group exercise is best done through collective discussions to develop visual models of the ‘problem tree’, the ‘objective tree’ and, finally, the intervention logic using cards taped to a wall or laid out on the floor. The component elements (outputs, outcomes, drivers, assumptions intended impacts etc.) of the causal pathways are written on individual cards and arranged and discussed as a group activity. Figure 10 below shows the suggested sequence of the group discussions needed to develop the Theory of Change for the project, with the ‘objective tree’ as a starting point for brainstorming. Remember, multiple causal pathways are discussed and mapped, to produce a complete Theory of Change. In this example there is only one. Figure 10: Suggested steps in developing a Theory of Change for a project STEP 1 Brainstorm the project’s intervention logic: key project outputs, outcomes, and intended impacts Project activities Assumption Assumption Project output Project activities Project activities Intermediate state Outcome (EA) Impact Project output Driver Project activities or outputs STEP 3 Brainstorm to identify any additional outputs and activities needed to support the drivers Driver STEP 2 Project activities or outputs Brainstorm the factors and identify the key actors that increase the likelihood of achieving results and the risks that might jeopardise them Discussion questions might include: Have all major pathways been identified? Are there other causal pathways that would stem from the use of project outputs by other potential user groups? Is (each) impact pathway complete? Are there any missing intermediate states between project outcomes and impacts? 11 The 9 Major Groups are: women, children and youth, workers and trade unions, indigenous people and their communities, NGOs, local authorities, scientific and technological community, business and industry, and farmer as recognized in Agenda 21 26 Have the key impact drivers and assumptions been identified for each ‘step’ in the pathway? Does this represent the reality? Are the economic, political and socio-cultural dimensions needed in the intervention considered? 27 Figure 11: A single impact pathway depicting assumptions, risks and ‘impact drivers’. Assumptions Assumptions Assumption Pollution Management receives high priority by central government Activities Review of existing freshwater ecosystems assessment tools completed and guidelines for water assessments established. Guidelines for water assessments established Risks Assessment tools and Management methods for maintaining freshwater ecosystems Up tak e of t ool Activities Preparation of training materials Output Training modules and courses for EPA staff on tools and mehtods indin of f Intermediate State Enforcement Intermediate State Effect Polluters are effectively controlled by EPA Quantity of solid waste dumped into river is reduced River water quality is improved gs e of tra ini a ke Upt Environment Protection Agency effective and responsive to a broad range of stakeholder interests ng o ethods ta k Output Institutional assessment of EPA Uptake mgt. m f tools / Threat to riverine ecosystem is decreased and fish stocks increase Change of behaviour is not at sufficient scale for measurable effects. s Outcome Output Demonstration of assessment tools and management methods in selected pilot sites Risk Regulations are not sufficiently enforced Output Up Activities Select pilot sites Adapt freshwater ecosystems assessment tool to suit conditions in pilot sites Enforcement of regulations, changes household and industry waste disposal behaviour Regulations and enforcement mechanisms exist and penalties are sufficient to deter polluters Catch and income of fishing families is stabilized or increased Activity Training provided to water officials Activities Awareness-raising events for new management approaches and role of EPA Involve key stakeholders including civil servants in project activities. Promote visits to pilot sites by international orgs and development agencies. Activities Project raises awareness among among Civil society ‘watchdogs ’to demand enforcement of pollution regulations and public disclosure of offenders Project lobbies for public disclosure of offenders Drivers Active civil society ‘watchdogs’ for enforcement of pollution regulations EPA disclosure of pollution offenders Activities Project lobbies for public information campaigns Project supplies resources to help develop public information materials Project pursues partnerships to promote widespread and effective delivery of public information materials Incidence of water borne diseases and illnesses among poor families and under 5s is reduced Drivers Govt. & Civil Society run effective public information campaigns Drivers to reach outcome EPP staff take ownership of assessment tools and management methods Strong civil society interest in water quality issues and EPP activities International organisations and development agencies help promote replication of pilot sites 28 d. Engaging with Stakeholders The process of project design involves stakeholder consultations. Stakeholders may be from the public sector, Major Groups (including the private sector), and other UN agencies operating at the country level (including UNCTs). Stakeholders should include any individual or group who is likely to affect, or to be affected by, the project implementation and its outcomes, either negatively or positively. The Project Manager should consult relevant Regional Offices for assistance in identifying key stakeholders and engage them in planning exercises. When stakeholders may become partners in implementing the project, Project Managers should consult Chapter 7 of this manual and the UNEP Partnership Policy and Procedures for details on how to proceed. Once the project intervention is broadly specified and a broad-range of stakeholders is identified, the project team should analyze their relative roles, needs and responsibilities. Stakeholders should be identified and mapped depending on their importance and influence relative to the project. Stakeholder consultations should be shaped to better understand problems, barriers, risks and feasibilities, to inform the design of the project approach. This exercise should also consider socio-economic linkages, including gender and poverty alleviation. How the project responds to competing stakeholder needs and interests while contributing to human well-being should be a key output of a stakeholder analysis 12 . Results of stakeholder consultations are entered into the Project Document. Table 1 below incudes an example of Stakeholder Analysis (referring to the example provided in section C above). Please bear in mind that this is a simplified example; project teams may add columns and rows as necessary and appropriate for the actual project and stakeholder groups they are assessing. GEF PIFs have a specific Stakeholder Analysis table included in the template. Table 1: Example of Stakeholder Analysis EPA Riverine Communities Industry Problem and expectations towards the project Ineffective in controlling polluters Solid waste and waste water dumped into river / Water borne diseases and reduction in income from fish stocks Solid waste and waste water dumped into river Weaknesses Poor capacities/Lack of collaboration Lack of awareness and availability of alternative systems No incentive to collaborate Potential Mandate and political support Change in behaviour / Control over industry Change in behavior / Increased security Positive impact Increased effectiveness in controlling polluters Improvement in health conditions and income Negative impact Resources diverted from other priority areas - Payment of fines / Increased costs re: alternative methods of waste discharge 12 This includes the rights of indigenous peoples in accordance with international human rights instruments and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP-2007). Draft guidelines are available under the UNREDD programme. GEF projects have also to comply with relevant GEF Policies, including: Environmental Social Safeguards, Indigenous Peoples, and Gender 29 In addition, during project planning and implementation, continual stakeholder analysis should provide the following information which should be documented in the Project Document for reference: Identification of the social consequences of the project (who will benefit or be impacted negatively, and how?); Examination of broad social, environmental, political, economic and technical contexts and identification of appropriate responses or mitigation strategies; Identification of existing or potential conflicts of interest and appropriate mitigation strategies; and Stakeholder expectations of the project and associated outcomes. Stakeholder engagement throughout the project cycle is essential to bring behavioural changes with the project’s interventions, and to avoid negative and unforeseen effects of a project or activity. UNEP should proceed from activity to activity in a sequenced manner based on a Theory of Change (underlying rationales and assumptions that define the chain of results). This will normally involve changing the behavior of stakeholders within their political and economic context. The principle of Prior Informed Consent13 is to be adhered to in all projects working directly with local stakeholders. Stakeholder engagement includes defining a project’s execution arrangements. With regard to GEFfinanced projects, most of them are executed by national or local organizations. The GEF Council sees this modality as a way to ensure country ownership, mainstreaming of environment into government policies, and building local and national capacities in accordance with Accra and Paris Declarations, as well as in support of the Bali Strategic Plan. In addition, it improves the sustainability of the project through project management capacity building in the country. Therefore, for national GEF-financed projects, local execution should be encouraged. In some cases, a local institution that may feel it requires additional support for project management, may request UNEP’s assistance for both technical and managerial support. These cases should be discussed on a case by case basis with the GEF Coordination Office at the IPI stage. e. Formulating Project Results Projects should contain a series of logically connected and sequenced activities aimed at achieving clearly specified outputs and outcomes. Based on the project concepts in the Programme Frameworks, feedback from stakeholder consultations, and preparation of a detailed ‘Theory of Change’, the expected outputs and outcomes of a project can be summarized using the Logical Framework (or more briefly the LogFrame) approach during the planning stage. The LogFrame Approach is an analytical process to develop interlocking concepts of project ideas in a structured and systematic manner. The LogFrame Approach has been adopted as a project planning and management tool by most multilateral and bilateral development agencies. Over time, different agencies have modified the formats, terminology and tools of the LogFrame Approach; however the basic analytical principles 13 The principle of Free Prior and Informed Consent (FPIC) should be followed when indigenous peoples and their communities are affected by the project through potential relocation for example in which a just and fair compensation can be expected by indigenous communities. 30 have remained the same. Knowledge of the principles of LogFrame Approach is therefore essential for all staff involved in the design and delivery of UNEP projects. The LogFrame Approach should be thought of as an ‘aid to thinking’. It allows information to be analyzed and organized in a structured way, so that a project intervention can be quickly understood. While the development of a Theory of Change is a process involving stakeholder analysis, problem analysis, objective setting and strategy selection (see preceding sections), the LogFrame captures a summary of the results of this process. The LogFrame consists of a matrix with a row for each result at different levels, i.e. project goal, outcomes and outputs, and columns to specify a results statement, a performance indicator with baseline and target, and a means of verification for the indicator. UNEP uses a modified template of the LogFrame as shown in the Table 2 below with the following features: The project outcome(s) and the relevant EA(s) from the MTS under which the project outcome(s) can be categorized; The project outputs and the relevant PoW output under which they can each be classified; Activities are not included as part of the LogFrame (instead, the project activities are described in the “delivery plan” of the project document); and Milestones at the project outcome and output level. Milestones capture progress from project initiation to achievement of outcomes. They can be activities or sub-outputs needed to deliver key outputs (output level milestones), outputs themselves, or activities or events needed to ensure that outputs lead to outcomes (outcome level milestones).14 Donors might have specific requirements concerning the LogFrame design. Yet, for projects to be submitted and approved to PRC, they need to include a Logframe that follows the UNEP template. For GEF projects, please use the template provided in the GEF Monitoring and Evaluation guidance. The GEF template combines features from the UNEP template with GEF requirements. Table 2: UNEP Logical Framework Structure Project Outcome Outcome Indicators (with baseline and targets) Means of Verification MTS Expected Accomplishment Capacity or behavioral changes to which the project is expected to contribute How the outcome will be measured including quantity, quality, time How the information required to measure the indicator will be collected, when, and by whom The Expected Accomplishment under which the project outcome can be fitted Project Outputs Indicators (with baseline and targets) Means of Verification PoW Output Reference Number How the outputs will be measured including quantity quality, time How the information will be collected, when, and by whom Number of the corresponding PoW Output Tangible products or services delivered by the project Project Milestones Expected Milestone Delivery Date A scheduled event or output representing progression towards achievement of project outputs or outcomes Month/Year 14 Milestones are usually identified from the detailed Theory of Change. Together with the baseline and targets, milestones need to be thought through after operational details are clearly shaped. 31 For examples of LogFrames in the UNEP format, please click here. The focus in project design should be on outcomes and contributions to objectives, rather than solely on the production of outputs. Focusing on outcomes pushes Project Managers and teams to examine the many factors influencing a project and make better implementation plans. However, outcomes need to be formulated in such a way that they remain achievable by the project’s intervention. The project might not have full control, but the likelihood that the project outcome will be achieved due to the project’s outputs must be as high as possible. For example, a project may involve supporting a Government in preparing environmental legislation to improve the protection of wildlife in buffer areas surrounding national parks. If one focuses on outputs, then the project is considered successful when training and advice has been provided to the relevant officials drafting the legislation. But if one focuses on outcomes as UNEP has committed itself to, then one needs to examine if the legislation has been approved and gone into effect, and whether it has actually changed the behaviour of stakeholders in buffer areas surrounding national parks, in a way that protects wildlife in those areas better. If the drafted legislation is not approved and acted upon, then the project will be a failure because the intended, immediate outcome was not achieved (‘improved environmental legislation to protect wildlife in buffer areas surrounding national parks’), despite all of the planned outputs having been delivered (‘training and advice has been provided to the relevant officials drafting the legislation’). If Government has drafted the legislation but has no resources to raise awareness about and enforce it, then again the project could be considered a failure because the medium-term outcome could not be achieved (‘stakeholders in buffer areas surrounding national parks behave in a way that protects wildlife in those areas better’), despite the immediate outcome having been achieved. Project outcomes should be set at a level whether the project can realistically influence the behavior of stakeholders, and all the factors (e.g. resources, capacities) related to it. In the example presented above, the project should have set as its objective its immediate outcome (‘new legislation’). This will make the project more realistic. Due attention should be given to the level of ambition of a project, in line with resource and time constraints. However, this doesn’t mean that the project should ignore the need for changes to happen further along the causal pathway. It should also include activities and outputs that contribute to the drivers needed to achieve the medium-term outcome and longer-term impact. For example, the project could still support the Government’s resource mobilization efforts to finance awareness campaigns or equip rangers. This service might fall outside the main intervention logic of the project (‘assisting the government with preparing new legislation’), but would still be included in the project to enhance the likelihood of the project achieving outcomes towards impact. Finally, if the project has the resources and time to cover all immediate outcomes required for the medium-term outcome to be attained, it can set the medium-term outcome as the project outcome. 32 Box 4: Output vs. Outcome Outputs are the products, capital goods and services which result from a development intervention. Outputs relate to the completion of activities and managers have a high degree of influence over them. Examples of outputs include: conferences; workshops; publications; legal or policy advice; public awareness campaigns; training; etc. Outcomes are the uptake or use of project outputs by the project target groups or clients, and cause in general a change of behavior. Before this change in behavior can occur in the medium term, outputs can, in the short term, first lead to a change in capacity of the target groups. These changes in capacity are often called ‘immediate outcomes’ and these are more realistically within reach of the typical UNEP project. Examples of immediate outcomes include changes in policies, regulations, and laws, enhanced knowledge and skills, an improved financial resource base, improved planning etc. Examples of medium-term outcomes include: use of ecosystem management for climate change adaptation in coastal areas; improved wildlife protection practices in National Parks; etc. The detailed Theory of Change for the project intervention should facilitate identification of the underlying assumptions and potential risks. Project details on risk and opportunities are later captured in the Project Document under Risk Analysis. For more details on what the risks are and how to analyze the risks, please see Chapter 8: Risk Management. f. Planning how to measure the results Indicators LogFrames also contain indicators for each specified output and outcome. Successful specification of indicators allows the project to monitor its progress towards results and facilitates later evaluation. Also, project outcome and outputs can be further clarified from the process of defining the indicators. Difficulties in finding an outcome indicator could stem from the lack of clarity or unrealistic scope in articulating the outcome. If this is the case, the project needs to revisit the Theory of Change and the LogFrame to better define the output and outcome. More detailed information and examples of indicators can be found in the UNDP document RBM in UNDP: Selecting Indicators. Definition: An indicator is a quantitative or qualitative factor or variable that provides a simple and reliable means to measure achievement, to reflect the changes connected to an intervention or to help assess the performance of a development actor. Purpose: An indicator is a tool to help determine whether progress is made towards implementing activities and achieving the desired outcomes of an intervention. Indicators can help demonstrate progress when things go right and provide early warning signals when things go wrong; their purpose is to support effective programme planning, management and reporting by: Measuring progress and achievements Clarifying consistency between activities, outputs, and outcomes Ensuring legitimacy and accountability to all stakeholders by demonstrating progress Assessing project and staff performance Limits: Indicators only indicate; they do not explain. Determining that change has occurred does not tell the story of why it has occurred. Indicators constitute only one part of the logical and substantive analysis needed for development efforts to succeed. In addition, success requires common sense, 33 sound managerial judgment, leadership and creativity – none of which can be replaced by the use of indicators. Box 5: Types of indicators (not all mutually exclusive) Input indicators: Measure quantities of physical, human or financial resources provided to a program or project, often expressed in amounts of e.g. dollars or employee time. Output indicators: Track and measure the most immediate results delivered by a project – that is, the goods and services provided by the project (e.g. the number of wells constructed which provide access to clear drinking water). Outcome indicators: Measure the immediate, or short-term, results of program or project implementation for the beneficiaries (clients, customers) such as changes in behavior and or practices. Measures of beneficiaries’ preference and satisfaction with goods/services are also considered as outcome indicators. Quantitative indicators: Objectively or independently verifiable numbers or ratios. Measure quantity, such as the number of people who own sewing machines in a village, the wage rate or education levels. Qualitative indicators: Subjective descriptions or categories which Indicate people's judgments and perceptions about a subject, such as the confidence people have in sewing machines as instruments of financial independence. Process indicators: Measure delivery activities of the resources devoted to a program or project and achievement during implementation. Often indicators are set as completion or milestone events taken from an activity plan, and may measure the time and/or cost required to complete them. The use of indicators can be made into an elaborate science demanding a major workload. Using a large number of different indicators, however, has no merit in itself. The key to good indicators is credibility – not volume of data or precision in measurement. A quantitative observation is no more inherently objective than a qualitative observation. Large volumes of data can confuse rather than bring focus. It is more helpful to have approximate answers to a few important questions than to have exact answers to many unimportant questions. Effective indicators should be “SMART”: Specific (Specific enough to assess the progress and taking into account the target group (for whom) and location (where); Measurable (reliable and clear measurement is possible that can specify quantity (how much) and/or quality (how well)); Attainable (credible link to results) and Attributable, the indicator is measuring UNEP/project partner –related performance (and not something that might have ‘happened anyway’); Relevant (relevance to intended outputs and outcome); and Time-bound (by when) and Trackable (availability of data within reasonable cost and effort). Table 3: Examples of SMART outcomes and outcome indicators Expected outcome Expanded connectivity to information and communication technologies (ICT). Increased capacity of parliament to perform its oversight functions The national policy framework reformed on the subject of universal access to basic services. Outcome indicator Estimated number and proportion of the population with access to the internet, disaggregated by gender. Mechanisms for accountability such as a Public Accounts Committee are in place to ensure legislative oversight. New, adequate policies and legislation in effect on the subject of universal access to basic services. 34 Women’s organizations enabled to advocate and monitor improvement in the status of women. Systematic monitoring of progress in linking national development targets with globally agreed goals. Existence of national legislation and measures to provide an enabling environment for women’s nongovernmental organizations (NGOs). A comprehensive monitoring and evaluation system in operation to track progress in the country’s human development in the context of PRSP. Source: Adapted from the Strategic Results Frameworks of Gabon, Kyrgyzstan, Nepal, Tanzania and Venezuela, 2001. For each indicator, a baseline should be specified. Baseline data are needed to measure changes brought about by the project activities. The baseline defines the current situation (and recent trends), before the implementation of the project/activity. In addition to the baseline, a target should be set for each indicator before the outset of the project/activity. It is important to distinguish whether the target is an absolute value, or an incremental change from the baseline. For example, if your indicator is “number of countries,” and your baseline is “2 countries,” and your target is “5 countries,” you will need to specify whether the target is a total of 7 countries (incremental change of 5) or a total of 5 countries (incremental change of 3). Project Managers should establish the baseline and targets for the project by consulting relevant stakeholders and reviewing existing data and literature. For complex and/or large-scale projects, Project Managers can hire a consultant or institution to carry out a detailed baseline analysis. Defining indicators for UNEP’s normative work (such as policy advice, advocacy, and regional coordination) can be challenging. However, if a detailed Theory of Change has been developed, indicators can more readily be identified. For example, if a project’s desired outcome is an enhanced environmental legal framework, then the actual change can be measured with the adoption of new legislation. Measuring the change from normative activities can strengthen UNEP’s ability to show its achievement of results. Again, many UNEP projects involve activities on capacity-building, which may be difficult to measure. The critical questions in this case are ‘what capacity is to be developed?’, ‘What UNEP assistance is being provided?’ and “Who are the target groups (clients)?” A careful analysis of the relevant details can help determine the actual change to measure through indicators. For example, if the project is to provide capacity building on planning to the local government, it might be measured by monitoring the timeliness and quality of government action on a particular issue (using independent experts), prior to and after capacity building efforts. In this case, we would use the effect of the capacity building effort as a proxy indicator for the quality of the actual capacity building effort. Caution should be taken in using proxy indicators at different results level than the actual result we want to measure. Proxy indicators at a higher results level (as the one in the example above), might be affected by other factors than the project result and therefore not give a fair measure of achievement of the result in question. Proxy indicators at a lower results level do not always guarantee the achievement of higher level results. For example, if the number of days of training and coaching received is used as a proxy indicator for the enhanced knowledge and skills of the trainee, one has to be sure that the quality of the training was good, and not in the least that the training and coaching were appropriate for the trainee’s needs and initial knowledge and skills. Otherwise, this proxy indicator might give a much distorted measure of the intended result. The design of a Theory of Change and LogFrame should be an iterative process involving stakeholders. Project Managers should consult the stakeholders to identify key results and indicators to establish a common understanding of the stakeholders on project intervention, agree on how project progress will be monitored, and how performance will be assessed. More details on stakeholder engagement are in Section D of this Chapter. 35 All the above applies to GEF financed projects. However, in addition, an indicative and quantified baseline and target at mid and end point are required for each indicator at the PIF stage. During project preparation, the baseline has to be measured and indicators and targets adjusted accordingly. In addition, the projects have to identify which of the indicators in the GEF Tracking Tools is relevant to their project; only the key indicators should be selected. Projects that seek financing from multiple windows or focal areas of the GEF, have to choose indicators from all the Tracking Tools. The GEF projects have to report on the Tracking Tools at mid-term and end of a project. Means of Verification Indicators should include an accompanying means of verification, which specifies the quality (how well), time (e.g., at what week of the project, or month of the year), and location (where). It should measure change that is attributable to the UNEP project intervention. Each indicator should be linked to easily obtainable data sources in order to measure and verify progress towards planned results. In developing the means of verification, the Project Manager should consider: accessibility, reliability, relevance, and cost-effectiveness in collecting the data. Means of verification can include partners’ reports, but not the own project progress reports, and any tangible project output (e.g. manual, policy guideline, course material). For example, if the desired outcome of the project is the application of a renewable energy policy, and if it is to be measured by the number of countries incorporating a renewable energy component in national energy plans, government reports and statements on national energy plans can be used for means of verification Milestones towards achieving outputs and outcomes For UNEP projects, a milestone is a scheduled event representing progress towards the achievement of project outputs and outcomes. Milestones are used for project monitoring and management purposes, and should give an honest indication of the implementation status of a project. In UNEP, milestones are the benchmarks against which the progress of the project will be measured. Therefore, Project Managers need to spend adequate time thinking through the milestones during the design phase to be sure they are reasonable, attainable, and specific. The detailed Theory of Change is a useful tool to identify milestones and they should be formally captured as part of the project Logframe. For milestones to be useful to project management and supervision, they need to provide a true picture of progress towards results. If they are chosen in such a way that their attainment is almost guaranteed, so that a false image of progress is given, they don’t tell much about real progress to results, and this defeats their purpose. LogFrames should show clear milestones for each output for each six-month period of the project15, adhering to the following principles: Each Project Output should have only one milestone per six-month reporting period – the most important milestone for that project output in the six-month period; Note the milestone can be leading ‘to’ or stemming ‘from’ the output; Also note that the delivery date of a milestone should be within the six-month period, but not necessarily fall on the last day of the period; Milestones must have only one dimension so their achievement can be qualified as either ‘yes’ or ‘no’; and 15 GEF projects have instead their own reporting system, based on Project Implementation Review (PIR) sheets. 36 Outcome milestones should show that efforts are being made to help the project bring about capacity and behavioral changes in stakeholders so that progress towards achieving the desired project outcome is evident. For example, if the project’s desired output is to develop tools for ecosystem assessment and management for sustainability of water regulation and purification services, the progress can be measured with the following milestones: Three preliminary community meetings with local stakeholders organized by April 2012 Core experts selected to develop management tools and options by December 2013 At least 3 tools and options developed by October 2012 Total 10 tools and options developed by September 2013 Monitoring and Evaluation Plans Planning for monitoring and evaluation should be also considered as part of the project design. Monitoring and evaluation are critical parts of project management and should enable the Project Manager to understand whether the intended results are being achieved, and to identify issues which require corrective actions. Monitoring is a continual process that provides up-to-date information on the project’s performance, whereas evaluation is conducted at a specific point (mid-term and terminal) for an in-depth analysis of whether the project achieved its planned results, what the project performance has been, the identification of corrective actions (usually at mid-term), and formulation of lessons learned. Project Managers should plan in advance the necessary tasks and activities to conduct monitoring and to facilitate an independent evaluation, and should incorporate resources for monitoring (by the Project Manager with his/her team and partners) and evaluation (by the UNEP Evaluation Office) in the project budget. When designing a project, it may be appropriate for the Project Manager to allocate part of the project budget for the purpose of collecting data to establish an empirical baseline for the project and for collecting data on a regular basis to monitor project progress. (See Chapter 9: Financial Management) For detailed processes of planning for evaluation, please see Chapter 10: Evaluation. GEF financed projects are required to identify the expected costs of M&E during the life of a project at the PIF stage, and then to prepare a fully costed M&E Plan and Budget at the project document stage. Cost standards have been developed for all GEF projects. g. Defining the Project Approach When the project intervention and desired results have been defined using the Theory of Change and specified in a LogFrame, the project’s approach needs to be developed to define exactly what methods, tools and procedures will be used. The project approach includes developing a work plan with a clear schedule and responsibilities. The results formulated in the LogFrame can be delivered by a variety of methods. For example, the project may be implemented by UNEP staff, UNEP-hired consultants, project staff hired by UNEP specifically for the project, or external partners. Each of these options has different procurement rules, 37 costs, recruiting time, legal procedures, and time needed to formalize the arrangements. It is important to carefully evaluate the budget and timeline of the project approach before making a decision. (See Chapter 9: Financial Management for more details on how to develop a project budget) As mentioned in the example, a key decision to be made at this stage is on the use of partnerships in project implementation. Based on the stakeholder analysis and consultations, a Project Manager should identify potential partners and evaluate the benefits and risks of working with an external partner against the option of implementing the project within UNEP. Details on partnership analysis and management are available in Chapter 7: Partnership Management. If the project involves activities at the country or regional level, the Project Manager should consult the Division of Regional Cooperation (DRC), including relevant Regional Offices. The geographical focus should be reviewed in detailed project planning to confirm its relevance, avoid duplication, and increase synergy with other UNEP activities in the region or country. The Common Country Assessments (CCA) conducted by UN Country Teams can also provide valuable background information on the country situation and therefore inform the best approach for UNEP at the country level. Planning for sustainability Many projects fail to deliver long-lasting results because their achievements and results are unsustainable (i.e. they will not continue after project completion). Actions to ensure the sustained value of project outputs and long-term sustainability of project outcomes should be embedded in the project design. The Project Manager should consider sustainability during project design when: (a) selecting the most appropriate partners and beneficiaries for project implementation, and (b) developing activities or strategies to provide beneficiaries with the skills, training and tools they would need for the project outcomes to be sustained post-project. A sustainability plan may entail e.g. an initial and sustained training and capacity building effort for project partners, followed by a phased withdrawal of UNEP inputs/funding. All sustainability plans should take into account key issues such as: fostering ownership by the stakeholders, providing policy support, using appropriate technologies, respecting human rights (including indigenous peoples’ rights) and social and cultural norms, values and attitudes, ensuring responsiveness to gender issues, meeting social and environmental safeguards, developing partners’ institutional and management capacity, and considering economic and financial viability as of project design. In the UNEP context, sustainability means the continuation or maintenance of outcomes and benefits such as improved institutional capacities after the completion of a project. Sustainability should be planned along three main lines: 1. Environmental and social sustainability: where the environmental and social benefits of a project are sustained; 2. Institutional sustainability: where the relevant institutions expected to continue to take action have the necessary means and interests to do so; and 3. Economic/Financial sustainability: where the actions that may require financial input are likely to continue. In order to strive towards sustainability, the following key questions should be considered at the project design phase: 38 Policy Support Will new policies (or changes in existing policy priorities) be in place by the project end, to support the project outcomes post-project? Is the required support from relevant political, public and/or business organizations expected to be in place by project end? How can and will this be achieved, and who will the project support this effort? Financial sustainability Can partners afford to sustain the achievements and results of the project independently, postproject? Is there demonstrated government commitment to provide the budget required to sustain the achievements of the project in the longer-term? Is a cost-recovery mechanism being considered and developed during the project, among other measures to sustain project results in the long term? Is the private sector’s involvement being considered among the options for sustaining project achievement results? Capacity Development Are sufficient resources being allocated in project design to ensure the appropriate transfer and utilization of the new knowledge generated? Is institutional and/or technical capacity of partners sufficient to absorb and sustain the results and achievements of the project in the long term? If not, what will the project do to ensure that such capacity can be developed during the life of the project? Environmental & Social Safeguards Are environmental and social safeguards being considered at project design? While all UNEP actions should lead to environmental sustainability, it is important that unintended negative impacts across different environmental sectors are avoided. For example, measures to adapt to climate change should not aggravate ecosystem degradation. See the GEF Environmental and Social Safeguards checklist and the Environment Management Group guidance for an example of how to think through this question. What are the mechanisms envisaged and put in place to ensure compliance with the UNEP E&S safeguards (under development), during project implementation? Did Environmental & Social safeguards prevent and mitigate undue harm to the environment and people at the earliest possible planning stage? Exit Strategy What is the project specific plan for the gradual phase-out (or exit) of the project, including i.e. hand-over of management/technical responsibilities to those partners that are expected to sustain or replicate project results post-project? All GEF projects have to define a sustainability plan. Sustainability in the context of GEF projects depends on the type of project and its location along the continuum of GEF interventions. Furthermore, sustainability may be assured by the government, partners or other Agencies building on the results of a completed project. 39 Planning for replicability “Replicating” or “scaling up” is sometimes used as a cost-effective way of achieving a project or programme outcome. UNEP projects may test certain new environmental tools or methodologies, working closely with one or more partners, and, if successful, these new tools and technologies may be carried forward, expanded upon and replicated by the project’s partners. UNEP’s role is not usually to replicate the use of such tools or methodologies, but rather to select and assist partners that are better placed in taking ownership of the project outputs and new approaches in order to scale them up and replicate them widely. Click here to reach about the “Wings Over Wetlands” (GEF project) which was successfully scaled up to achieve the expected outcome. Some key questions that should be considered during the project design phase to maximize replicability include: Are the appropriate partners being selected to ensure maximum uptake, replication and scaling-up of project results in the long term? Are project partners being adequately involved in all stages of project design and implementation so as to ensure their ownership and support for project results? Are project partners and their respective networks interested and clearly committed to the uptake, replication and up-scaling of the new tools and technologies to be developed by the project? In addition, the inclusion of mechanisms for sharing knowledge across countries and regions can also help promote replication of the project outputs and approaches. In particular, South-South cooperation – meaning the exchange of knowledge, best practices, technical support, human resources, trade and policy advice among developing countries - can be an effective and efficient way to support replication, as experts and institutions in developing countries may share similar political, socio-economic and environmental challenges and can provide support to each other based on their own lessons learned. The Bali Strategic Plan stipulates UNEP’s role in strengthening capacity building and technology support in line with country needs and priorities. It highlights the importance of South‐South cooperation as a key delivery mechanism, and underlines the importance of developing human resources and institutions of the South. Typically, the range of services provided by UNEP’s South‐South Cooperation initiatives include specialized data support, policy advice, technical backstopping support, training and related capacity development, expertise inputs including tools and methodologies, outreach materials and mechanisms for information sharing. See UNEP’s recently revised policy on Integrating South-South Cooperation in the Programme of Work. h. Cross-cutting Issues UNEP has defined several cross-cutting objectives which the organization aims to achieve through the implementation of its work. Thus, when designing a project, managers and teams should consider how the intervention may contribute to these cross-cutting objectives. Project managers will be also required to report progress on the achievement of objectives related to cross-cutting issues during project implementation, in the project’s monitoring section within the Programme Information Management System (PIMS). MDG7 Environmental Sustainability: UNEP projects claiming a contribution to the achievement of MDG7 targets must meet specific indicators pertaining to one or more specific targets. More information can be found here: Goal 7. 40 Box 6: MDG 7 targets and indicators Target 7a: Integrate the principles of sustainable development into country policies and programmes; reverse loss of environmental resources Target 7b: Reduce biodiversity loss, achieving, by 2010, a significant reduction in the rate of loss Target 7a and 7b Indicators: 7.1 Proportion of land area covered by forest 7.2 CO2 emissions, total, per capita and per $1 GDP (PPP) 7.3 Consumption of ozone-depleting substances 7.4 Proportion of fish stocks within safe biological limits 7.5 Proportion of total water resources used 7.6 Proportion of terrestrial and marine areas protected 7.7 Proportion of species threatened with extinction Target 7c: Reduce by half the proportion of people without sustainable access to safe drinking water and basic sanitation 7.8 Proportion of population using an improved drinking water source 7.9 Proportion of population using an improved sanitation facility Target 7d: Achieve significant improvement in lives of at least 100 million slum dwellers, by 2020 7.10 Proportion of urban population living in slums Poverty Alleviation: To fight poverty, promote security and to preserve the ecosystems that poor people rely on for their livelihoods, green economic growth and environmental sustainability must be placed at the heart of economic policies, planning systems and institutions. The Millennium Development Goals (MDGs) have helped to refocus the attention of the world community on these needs by setting ambitious targets for the elimination of poverty. They reaffirm the importance of achieving environmental, social and economic sustainability. Science-Policy Interface: One of UNEP’s over-arching objectives is to strengthen the science-policy interface, meaning that sound science better informs policies, and policy makers have a better understanding of science. UNEP’s work often facilitates science policy dialogue with the goal being that scientists and policy makers reach an understanding over competing interests. Coherence in the UN: As part of the UN system-wide efforts to achieve coherence in Delivering as One, UNEP projects need to consider how the activities can be coordinated with other UN agencies at the global level (United Nations Development Group, Chief Executives Board), regional level (Regional UNDG, Regional Coordination Mechanism) and country level. Catalyzing Change in the UN: As the environment programme of the UN, UNEP provides leadership to strengthen the integration of the environmental agenda and provides technical assistance in environmental activities of the UN system. Integration of Gender Concerns in Project Formulation and Implementation: Gender disparities are deeply entrenched in policies, institutional and legal practices, households and social relations. Gender is therefore a cross-cutting issue that needs to be built into all aspects of policy formulation, programme and project planning, institutional structures and decision making procedures. The process 41 of integrating gender equality concerns across all these areas is known as gender mainstreaming. See the Guidance Note on Gender Analysis at Project Level for more information. Bali Strategic Plan (BSP): As described in Chapter 2, The BSP is one of the key principles in UNEP’s programme which aims to strengthen UNEP’s technology support and capacity building for developing countries. Implementation through South-South Cooperation Approach: South-south cooperation (meaning cooperation between developing countries) can be an effective and efficient way to support replication, as experts and institutions in developing countries may share similar political, socio-economic and environmental challenges and can provide support to each other based on their own lessons learned. See UNEP’s recently revised policy on Integrating South-South Cooperation in the Programme of Work. Participation of Major Groups and stakeholders of Civil Society at all levels of project development and implementation. UNEP’s work is guided by the Principle 10 of the Rio Declaration. Integration of Indigenous Peoples issues, needs and concerns in project planning, development, implementation and evaluation. i. Planning how to operate a project When the project’s desired outcome and methodologies have been chosen and outlined in the project Logical Framework (see Section C), Project Managers need to identify the main activities to be implemented and break them down to manageable tasks. Based on the project Logical Framework and related activities and tasks identified, Project Managers should develop the associated work plan to meet each specific target, along realistic timelines. In this process, the clarity of sequence (order of activities) and dependencies (dependence of an activity on start or completion of another activity) should be considered to develop an effective and realistic work plan. The project Logical Framework and milestones should be used as key benchmarks in developing the work plans. Gantt charts are one type of standard tool used to communicate the details of the work plan. If the project involves complex funding arrangements or a long-term timeline, the Project Manager may wish to consider managing the project in separate phases and include them in the work plan. Work plans should also present clear roles and responsibilities for each task or activity. The Project Manager should assign each task to a member of a project team or a partner, considering the skills, experience and capability required for each. Clear accountability is essential for the successful management of the project and achievement of the intended results. In UNEP’s matrix approach, every project output is assigned to one Division or Regional Office, along with a budget for that project output. Even when responsibility for individual project outputs may be assigned to different Divisions or Regional Offices, only one Division or Regional Office remains accountable for the overall management of the project and the overall project budget. 42 In developing the details of a work plan, Project Managers should also take into account the requirements for project supervision, including monitoring and evaluation. The work plan should include the timing of mid-term and terminal (i.e. end-of-project) evaluations. Realistic estimates of time required should be made for each activity and task related to the project, informing the realistic design of milestones. For more details on these areas, please see Chapter 5: Implementation and Monitoring, and Chapter 10: Evaluation. See also the section “References” for templates of a Project Logframe, Workplan, Monitoring and Evaluation plan, and Supervision Plan. GEF Task Managers are required to submit a Project Supervision Plan at the time of project appraisal (project document), as well as report on implementation of the plan on a yearly basis. j. Procurement Planning The planning phase of a project should, where appropriate, consider the procurement component. Whether the requirements are for goods, services or works, early and accurate planning is essential to avoid last minute, emergency or ill-planned procurement, which is contrary to open, efficient and effective – and consequently transparent – procurement. The ultimate goal of procurement planning is coordinated and integrated action to fulfill a need for goods, services or works in a timely manner and at a reasonable cost. In addition, most potential savings in the procurement process are achieved by improvements in the planning stages. Good procurement planning is essential to optimize the contribution of the procurement function towards achieving the overall goals of the organization. It supports many goals, of particular interest to the project are: • • • • • • • Transparency Early requisition to reduce any delays in procurement and timely delivery to project sites. Early identification of right commodities and quantities to meet programme needs. Effective supply strategy and timely programme and project implementation. Effective and timely solicitation of offers, award of contracts and delivery of the goods, services and works required. Sourcing the right suppliers on time to avoid cutting corners under rush procurement to meet deadlines or budget expenditure. Avoidance of unnecessary exigencies and urgencies, enabling full competition and full compliance with standard rules and procedures. Procurement planning clarifies what is needed and when it is needed to both user and buyer. Effective procurement planning enables the organization and its staff to work smoothly to achieve the project’s goals with the right quality and quantity of inputs in place; ineffective procurement planning may result in failure to achieve those goals, putting in jeopardy the FRR and procurement principles and causing damage to the credibility of the organization. 43 k. Developing the Project Document Once the Project Manager and team decide on a project design, they must enter all the details into a Project Document. Project documents may follow different templates, according to whether they will use GEF funds or not. For GEF-financed projects, the DGEF UNEP Project Document Template should be used, along with its appendices. In the other cases, the UNEP Project Document Format refers. The Project Document specifies the project boundaries in terms of project duration and planned budget, and shows the logical flow of project elements towards a clearly specified result. The Project Document should describe key issues in each of the sections of the template, in particular because these details will be uploaded in PIMS and serve as the basis for monitoring project performance: Project Overview Project Justification: Why UNEP is well-positioned to get involved; Justification for the proposed intervention (business case); How the project will contribute to the achievement of the UNEP PoW; Project Statement & Approach: Full description of methodologies; Relationship with past and on-going projects; Analysis of key stakeholders, their relative roles, responsibilities, and expectations, and the possible impact of the project on certain stakeholder groups; Delivery Plan, Budget, and Organization: Logical relationship among activities, outputs and outcomes based on challenges, strategy and purpose; Clear management and operational structure showing how the organization will implement the project, not just with external partners but also internally, showing the responsibilities and budget allocations of other participating UNEP Divisions and Regional Offices Risk Analysis: Opportunities and challenges that will be encountered during the project lifecycle (See Chapter 8: Risk Management for more details on risk analysis) Reporting & Evaluation: A monitoring plan with a defined budget and assignment of tasks to ensure adequate and continuous monitoring of the progress; Description of any planned evaluations (e.g., mid-term and/or terminal) 44 4. Review and Approval a. Approval of Project Concepts In order to set minimum quality standards, UNEP has one consistent project approval process for all projects, regardless of the managing Division or funding sources, including GEF. All UNEP Project Concepts are reviewed and approved by the SMT as part of a Programme Framework and the PoW. The Subprogramme Coordinator obtains authorization from the Lead Division Director to submit the Programme Frameworks to QAS for final review by the SMT as part of the PoW. The SMT reviews the overall portfolio of project concepts in the Programme Frameworks, and assesses the following, on the basis of the information included in the project concepts: Coherence: Logic and rationale in relation to the Subprogramme strategy and EA; Structure: Clarity in the roles and responsibilities of Divisions and Regional Offices, coordination mechanism and accountability between them; Capacity: How the expertise in divisions and regional offices will be used to deliver the projects and how shortfalls in capacity can be addressed; Partnerships: Use of partnerships in implementing the PoW, in particular to leverage UNEP’s catalytic role; Geographic Balance: Appropriate geographic balance between different levels of engagement at global, regional and national levels, and suitability of geographic locations for activities; Risk: Implications of relevant risk and opportunities; and Resource Mobilization: Potential and ability to attract donor funding. If a project concept is proposed after the approval of the Programme Frameworks, the project concept must demonstrate how it builds upon the existing portfolio of projects in the relevant Programme Framework in delivery of Outputs and EAs in the PoW, using the format provided in the Programme Framework template. This project concept should be reviewed by the relevant Subprogramme Coordinator, who – once (s)he is satisfied with the quality of the project concept - submits it to QAS for quick review by a strategic team of Division Directors (but smaller than the SMT). A new project concept does not trigger revision of the whole Programme Framework or development of a new Programme Framework. Figure 12: From project concepts to project documents Programme Frameworks (by Expected Accomplishment) • Maps how to achieve Expected Accomplishments • Specifies performance indicators • Contains Project Concepts • Facilitates Resource Planning • Fundraising tool Projects • Building blocks to achieve POW Outputs • Aligned with POW Outputs and EAs • Contain Milestones SMT Approval Project Review Committee Approval 45 In the case of GEF concepts that are proposed after approval of the Programme Frameworks, the project concept must undergo a “Concept Review and Clearance” (CRC) process prior to being submitted to the GEF Coordination Office for clearance and submission to GEF. Key features of the CRC, in addition to those mentioned above, are: Evidence of country ownership and endorsement of the project Fit with UNEP’s comparative advantages vis-à-vis other GEF Agencies Capacity of the Executing Agency to deliver Adequacy of indicative budgeting proposed (including co-finance) to deliver; level of ambitiousness and absorptive capacity of the proponent Compliance with all GEF standards, including availability of GEF financial resources Exemptions from CRC are provided only to those projects that are being resubmitted after GEF Sec review, and to Enabling Activities that are sub-projects of a main project or programme already cleared by CRC.16 All GEF projects undergo a second review by the GEF Secretariat, prior to being recommended to the GEF Council for approval as part of the GEF Work Programme. The GEF Council reviews at least two and sometimes four Work Programmes every year. b. Approval of Fully Developed Projects The Subprogramme Coordinator coordinates the steps involved in getting a project from a concept to the PRC, according to the following steps (***): Step 1 - Project design: A project is designed in consultation with Regional Offices and relevant Divisions, using the ProDoc template provided by QAS. Step 2 - Peer Review: This is now considered as a good practice, and it is strongly recommended. Before a project is submitted for any kind of approval, its draft ProDoc should be peer reviewed by UNEP colleagues in the relevant Regional Offices and Divisions, who have the requisite expertise in order to improve the quality of the project document. The project team identifies who is in the peer review panel, and the names of the peer reviewers should be mentioned on the draft ProDoc submitted for review and approval. Step 3 - Submission to the Division Director: The Project Manager submits the project document to the Division Director of the Managing Division, who reviews and signs it. In the case of GEF financed projects, the Lead Divisions signs. Step 4 - Submission to the Subprogramme Coordinator: The Director submits the project document to the relevant Subprogramme Coordinator for review. In the case of GEF projects, the Subprogramme Coordinator reviews first and recommends to the Lead Division Director. Step 5: Submission to QAS / PRC or GEF PRC - Once the Subprogramme Coordinator is satisfied with the quality of the project s/he submits it to QAS for PRC review. As the secretary of the PRC, QAS ensures that the project checklist of standard items to be contained in the project are followed and then organizes PRC meetings from a selected list of members based on the thematic areas of the projects under review. In the case of a GEF financed project, the GEF 16 So called Enabling Activities are not required to go through PRC, unless they are more than $500,000. This is to expedite the process, given the fact that all Enabling Activities (like NIPs, NAPAs, etc.) are blueprints and follow the same mold. In the case of stand-alone enabling activities, the "first" one of its kind is approved, while the remainder is delegated to the Director of GEF-Coordination Office for further quality assurance prior to submission. Once submitted to GEF Secretariat and following approval, enabling Activities directly go to the Division Director who can sign it (if it is within the Delegated Authority). 46 Portfolio Manager is responsible for obtaining all reviews and signatures and submitting to GEFCO for PRC review. QAS will also enter the project Overview and Executive Summary from the submitted project document into the Programme Information Management System (PIMS) and upload the draft project document and other relevant submissions on PIMS and the UNEP Intranet. This is the beginning of the pipeline to project approval and implementation. Project Managers and teams can check PIMS to see the approval status and PRC meeting dates convened by QAS to review the project. The date of the PRC is the first day the project appears in PIMS, and it is therefore in the monitoring system. If a project does not proceed to approval within six months bt remains open, it will be caught in the “projects at risk system”. In the case of GEF projects, the Task Manager is responsible for entering relevant data into ADDIS, a dedicated GEF data base. ADDIS will soon be integrated into PIMS. Box 7: The Project Review Committee The PRC is a quality assurance mechanism of UNEP that reviews project documents against clearly defined criteria. The primary function of the PRC is to ensure the compatibility of projects with the PoW and to assess quality of their design. The PRC is comprised of: The Head of QAS as Chair of the PRC; Secretary of the PRC (QAS); Two staff members with substantive thematic expertise in the Subprogramme, who do not have a conflict of interest vis-à-vis the projects under review; A representative of QAS whose role is to pay particular attention to the logic of the project, examining whether the project approach is properly designed to achieve the identified results in the PoW, and whether the milestones will enable UNEP to monitor progress towards achieving those results; A representative of OfO whose role is to ensure the accuracy, cost-effectiveness and feasibility of the project budget; Gender Advisor, whose role is to review whether the project design reflects an adequately analyzed and integrated gender perspective; and A representative from DRC (and relevant Regional Offices) whose role is to review the delivery arrangement of the project, the coherence with other projects in the region, and the adequacy of the partners selected. A representative of GEF, if the project requires GEF financing The Subprogramme Coordinator and Project Manager attend the meetings of the PRC to discuss the project and liaise with the PRC on questions it may have. c. Project Quality Standards and Review Criteria Projects must meet the following general criteria to be successful: Feasibility: The project must be feasible vis-à-vis specified results, timeframes and resources. The desired outcome can be achieved within the project boundary and capacity of UNEP and/or available partners. Coherence: The project is based on a project concept in an approved Programme Framework, and must support a PoW output and EA. The project complements other UNEP projects including those implemented under the GEF (a well-formulated project should reflect the logical relationship between UNEP’s strategic priorities and the development priorities of the donor or beneficiary). 47 Relevance: The project must respond to the issues and problems of the stakeholders and demonstrate relevance to the needs of country and/or region. Stakeholders: The project must clearly identify stakeholders, including target groups and beneficiaries and articulate the engagement to be undertaken with stakeholders in the planning process (such as through the application of the Free Prior Informed Consent (FPIC) with indigenous and local communities residing in the project area and who are dependent of its natural resources), as well as during project implementation. Geographic Focus: The project’s geographic location and relevant management arrangement must maximize support for UNEP to achieve the POW EAs. Budgeting: The project must demonstrate that its benefits will exceed the costs, and must be planned in a cost-effective manner. Expectations for resource mobilization must be reasonable. Projects must have a secured funding worth 25% of the total budget or a minimum of 200,000 USD (whatever is greater) before they are eligible for review and approved by the PRC17. (See Chapter 9: Financial Management for minimum budget requirement) Coordination: Proposed project implementation arrangements must demonstrate a commitment to cross-divisional cooperation and the optimal use of expertise from UNEP’s divisional and regional offices. Accountability: The project must clearly show the distinct roles and responsibilities of, and budget allocation to, partners, as well as to Divisions and Regional Offices (Internal Cooperation Agreements can be used to show what each division and regional office is responsible for, including the milestones and progress reporting/monitoring roles). Risk Management Strategy: Project risks must have been clearly identified. Feasible and appropriate management plans for addressing the foreseen risks must be presented. Monitoring: The project must include an effective monitoring plan for tracking progress against outputs and outcomes, and tracking delivery by Divisions, Regional Offices, and partners. Evaluation: An evaluation plan must be clearly articulated to support performance management. Cross-cutting Issues: The project must address its potential impact on environmental, economic and social conditions, and responds to gender-related issues. Sustainability and Replicability: The project document must demonstrate that the benefits generated by the project are likely to be sustainable, and that implementation arrangements to increase replicability have been thought through. The PRC for GEF financed projects (including those that may have UNEP co-finance) is conducted in a similar manner as above, but the chair is delegated to the Director of the GEF Coordinator Office. The GEF-CO may also provide the Secretary as required. The PRC is conducted prior to submission of the full document for CEO Endorsement to the GEF Secretariat and Council. Resubmissions of project documents to the GEF Secretariat or Council are not required to undergo a second UNEP PRC. Exemptions from PRC approval are provided for Enabling Activities that are considered as “subprojects” of Programmes already reviewed by the PRC. In addition, GEF projects must adhere to the following criteria: 17 GEF eligibility: The project must be consistent with, and contribute to, the GEF Strategic Framework and the 4-year GEF Programming Framework. The proponent must be eligible for receiving GEF funds. The Country must have ratified the relevant convention (or in exceptional cases, be on the way to ratification), and be eligible for receiving funds through the World Bank or UN system. This applies also to projects subject to revision 48 d. Incremental cost principle: The project must make a convincing case that the GEF resources are being used to generate Global Environmental Benefits (GEB), as defined by the GEF Instrument and Operational Strategy Stakeholders: the project has to show evidence of Free and Prior Informed Consent (FPIC) in cases where there are concrete activities on the ground. Innovation and lessons learnt: The project must justify its innovativeness, in line with UNEP’s comparative advantages. Lessons from previous GEF and non-GEF projects, including from evaluations, should be referenced. An adequate bibliography should be included referencing scientific information. UNEP’s comparative advantage and baseline: The project must identify the linkages to ongoing UNEP activities, and quantify this “project baseline” as part of the UNEP co-finance. Care must be taken not to count the same baseline for two different projects. GEF fiduciary and business standards: The project must adhere to all standards as approved by the GEF Council, or operational standards as directed by the GEF CEO including correct templates, record of country endorsement of a project, etc. Budget: 100% of financing resources must be identified and confirmation letters obtained from all co-financiers. The budget must be adequate to the task, including duration of the project. The duration should also include at least 6 months for inception, and 6 months for financial closure. All budget figures are correct, meet standards, and consistent throughout the document. Implementation Arrangements: All implementation and execution structures must be clearly identified along with a project organogram. If UNEP is to directly execute any or all of the project components, then this has to be clearly explained in the project document. The PRC will validate whether the internal arrangements are correct and meet the policy on establishing a firewall between the IA and EA responsibilities. Previous experience with the Executing Agency is reviewed and adjustments made where necessary. In case of no previous experience, then the team will have to undertake and submit a Harmonized Approach Cash Transfers questionnaire. The Task Manager has submitted a Supervision Plan that is adequate to the task. Inter-Agency coherence: In the case of a multi-agency project, the design should reflect the appropriate accountability and division of responsibility between GEF Agencies, show evidence of efforts to streamline and harmonize as much as possible the procedural requirements of two or more agencies as applied to the project. UNDAF: Projects that have direct impact on the ground, should provide evidence of being in line with the country UNDAF(s) M&E: A fully costed M&E Plan and Budget is included, to meet GEF and UNEP standards. The plan envisages a terminal evaluation at least 6 months prior to project closure. Project Review Process Step 6 - Review by PRC: The PRC reviews projects based on the criteria articulated in Section C, and either: i) recommends approval of the project by the DED; ii) defers any decision pending receipt of an amended project based on PRC comments, or additional information or clarification; or iii) does not recommend approval of the project. Step 7 - Revision by Project Manager (where necessary): After a PRC meeting, QAS (and in the case of GEF projects GEF CO) uploads the minutes and decision of the PRC meeting to PIMS, posts them on the UNEP Intranet, and follows up with the responsible Project Manager. The Project Manager revises the project document based on the comments received, and submits it back to the Subprogramme Coordinators/GEF Portfolio Manager who will then submit the revised project document to QAS. QAS will check the revised document and consults QAS to decide whether an additional PRC review is necessary. 49 Step 8 - Submission to the Deputy Executive Director: If the revised document satisfies all PRC recommendations (including edits required), QAS submits it to the Deputy Executive Director (DED) for approval. Upon signature by the DED, the full details of the project, including the Logframe, are updated by QAS in PIMS, and the signed project document and PRC minutes are uploaded in PIMS and posted on the UNEP intranet. The project record is then available for project managers to provide additional information on their project and subsequently report on its progress. The Project starts officially after DED approval. In the case of GEF financed projects, the GEF-CO submits the PRC-endorsed document to the GEF for approval. Once it is approved, the Task Manager is responsible as above, for shepherding the project through the steps necessary for DED sign-off on the Decision Sheet, and Director sign off according to their delegated authorities. Upon approval of the project, Project Managers should liaise with the responsible FMO to formalize the financial and administrative arrangements of the new project. Project implementation cannot proceed without an action sheet signed by the Chief of OfO. For more details, please see Chapter 9: Financial Management. Figure 13: Flow of work for approval process Exceptions If a project is developed in a different document form, such as one required by a donor or partner (e.g., as required by the European Commission, GEF and UN Development Account), it is not necessary to reformat the document into the UNEP template for submission to the PRC. However, in order to guarantee that all UNEP relevant information are provided, the Project Manager should make sure that the main fields required in the UNEP Project Document Format and the Project Document Supplement are included in the alternative project document, or alternatively that at least the project overview sheet and log-frame are included. The UNEP Guidance Note on Delivering as One explains requirements for UNDAF at the country level. 50 5. Implementation and Monitoring a. Roles and Responsibilities Proper project management requires a team effort governed by project management standards and procedures. Generally the roles in project implementation can be grouped into the three levels of directing, managing, and delivering. Directing The Supervisor is the first reporting officer of the Project Manager and provides guidance for overall direction and management of the project. Critical tools of supervision include: progress reports and milestones (easily monitored through PIMS), mission reports, and the E-Performance Assessment System (e-PAS). Supervisors should include project supervision responsibilities in their own e-PAS, and ensure that Project Managers under their supervision also include project management tasks in their e-PAS. Supervisors should also asses the performance of the responsible FMOs from financial and administrative perspectives, and share feedback with the first reporting officer of the FMOs. The e-PAS appraisal should be based on the performance in project management against project outcome, duration, budget, and output quality. A project steering committee may be established to provide additional management guidance during project implementation. If the project needs a steering committee, the Terms of Reference (ToR) for the steering committee should be prepared before the project implementation starts, including a regular meeting schedule (often once a year). Click here to see an example ToRs for a Project steering committee. The composition of the steering committee may vary depending on the nature of the project; however, it is recommended to keep the size small (less than ten members). Members of the steering committee should be selected in a way that balances and diversifies perspectives and areas of expertise of the committee, and should have sufficient authority and experience to guide the project during implementation. Often these members will come from related partner agencies and stakeholders. A typical project steering committee will include one representative from UNEP, one from an implementing partner, two technical experts on the subject of the project, one donor representative, and relevant government representatives. If a project involves highly technical aspects, the Project Manager may establishing a technical advisory committee, made up of experts willing to provide advisory services for the project on a regular basis. This is particularly useful for quality assurance of projects that focus on science-policy synergies or methodology development. In all cases, roles and responsibilities of these committees should be clarified and established during project planning. Managing The Project Manager is accountable for the day-to-day management of the project within the defined schedule and budget. Project Managers liaise with the responsible supervisor and the project steering committee where necessary, and manage the deliverables from project team members and partners. 51 One of the key responsibilities of the Project Manager is to organize the project team at the beginning of the project implementation. The Project Manager is required to: Clarify the roles and responsibilities of project team members, supervisor, partners and stakeholders (once the project team members are recruited, further details of the roles and responsibilities can be developed); Finalize details of a project steering committee, if required; Organize an inception mission or workshop, where appropriate; Prepare, at least on an annual basis, an HR plan to take stock of what human resources will be required during the year, and initiate the necessary steps for meeting the needs in a timely manner, and Recruit project staff, if necessary. In the case of GEF financed projects, the Project Manager is typically hired by the Executing Agency and supervised by someone in that agency. The Task Manager and the GEF team provide oversight and technical assistance, and key indicators of performance of the projects are entered into their ePAS. While the primary responsibility of project management lies with Project Manager, the Fund Management Officer (FMO) provides technical support in financial and administrative management. Project Managers should closely engage responsible FMOs throughout the project cycle management and seek their advice on financial and administrative matters. More information on financial management is available in Chapter 9. Delivering The project implementation structure also includes project team members who are assigned to deliver particular project outputs. Project team members report to the Project Manager regarding their work on the project, but may have different supervisors located in their respective Divisions or Regional Offices. The Project Manager may assign responsibilities to the team members. External partners may implement projects in whole or in part. More details on managing project delivery through partnerships are included in Chapter 7: Partnership Management. Table 4: Summary of roles and responsibilities in project implementation ROLE RESPONSIBILITIES Project Manager Initiate and lead consultations with stakeholders Draft Project Document and LogFrame Initiate project in PIMS and IMIS via QAS and FMOs Actively manage all project activities and problems and raise issues as required to higher management Manage project team members' roles and responsibilities Maintain records of communications, financial records, and progress Carry out monitoring and reporting in PIMS 52 FMO Project Team Members Plan, monitor and manage specific outputs Take responsibility on monitoring progress and use of resources Identify and advise Project Manager of any issues and risks associated with responsible work area Propose corrective action or revision within project boundaries, if necessary Prepare work plan, report on progress and field missions Carry out oversight of partners’ performance Consolidate inputs for progress reporting Supervisor Guide Project Managers on project feasibility and provide timely and adequate feedback Advise Project Managers on coordination with other relevant UNEP projects Ensure effectiveness and efficiency in project delivery Resolve conflicts and approve any changes within the authorities defined in the Project Revision Guidelines Identify and deal with implementation problems on both administrative and technical/substantive issues, including political judgments Oversee progress through field missions or occasional communications with stakeholders and review project documents and progress reports Raise resources and monitor expenditures Raise any issues to QAS and/or the steering committee where necessary Subprogramme Coordinator Ensure coherence, coordination in monitoring and reporting of projects within Subprogramme, and highlight relevant issues to the responsible supervisor Assess project’s contribution towards overall delivery and achievement of PoW outputs and EAs Project Steering Committee Review of progress against approved work plan and budget and help provide advice to the Project Manager to ensure project achieves desired outputs and outcomes Provide guidance to Project Manager so that project business case remains valid, especially among stakeholders whose behavior must change if project is to achieve its planned results Provide guidance to Project Manager on needed changes or revisions of project Monitor and certify expenditures Advise Project Manager on administrative issues Alert Project Manager of financial risks anticipated or faced Initiate annual budget revision and regular budget revisions to reconcile expenditures and assist any budgetary issues in project revisions Review expenditure reports of implementing partners, and facilitate cash transfers if reports are satisfactory In the case of GEF financed projects, these terms do not apply. The roles and responsibilities are established between the Implementing Agency (represented by the Task Manager) and the Executing Agency (represented by the Project Manager). b. Starting Project Implementation The date of the DED’s signature for approval is the date of project commencement. In the case of GEF projects, the date of Director’s approval of the legal instrument with the Executing Agency is the date of project commencement. This date is entered into UNEP’s Programme Information Management System (PIMS) by QAS. The approved project document is then forwarded to the FMO, who prepares a "pink file" and submits to OfO. OfO creates a project in the Integrated Management Information System (IMIS) and enters the 'IMIS project code' in PIMS to automatically link related financial transactions to PIMS (for details of financial arrangements during this stage, see Chapter 9: 53 Financial Management, Section C: How to access secured funding). At the same time, QAS enters additional information into the PIMS project page, including duration, cost elements, LogFrame, delivery plan, and budget. QAS also updates the Executive Summary and the Overview according to the approved project document. At this point, the project is completely initiated in PIMS and IMIS, and is ready for implementation, disbursement, and reporting. In the case of GEF financed projects, all data entry into ADDIS is the responsibility of the divisional GEF team. The GEF Coordination Office monitors compliance. The Project Manager starts implementation of the project by carrying out the following tasks in cooperation with the project team: Review the work plan and budget for the first year, together with the project team members, partners and supervisor; Review the project approach and verify the baseline, targets and milestones; Confirm the implementation plan with the project team (documented in the Project Document) and formally approve it before project implementation begins; Set up the project filing system, in which all project implementation documents will be recorded; Set up a first Steering Committee Meeting; Finalize contracts for implementation partners (See Chapter 7: Partnership Management); Review and allocate the budget based on the secured funding (See Chapter 9: Financial Management); and Confirm and finalize co-financing arrangements (See Chapter 9: Financial Management). Project Managers should consider holding a Project Inception Meeting to bring the project team members and external partners together, and to reach a common understanding of the project tasks. Project Inception meetings are mandatory for GEF financed projects. The results of a successful inception meeting include: Project partners and staff are familiar with the design of the project and share its vision, approach and methods to achieve the stated results; External partners are familiar with UNEP rules and regulations. The log-frame and work-plan are revisited and updated/fine-tuned if needed; Project linkages with relevant ongoing/planned projects are assessed; There are clear roles and responsibilities within a common accountability framework for, inter alia, the Project Steering Committee (PSC), UNEP, and external partners; Communication lines and methods are agreed upon; Procurement plan is agreed upon; Monitoring plan is agreed upon and its costs known; Project risks are assessed and a risk management plan is developed (or a risk management plan in the project document is validated/updated); A plan for filling any gaps concerning baseline data is agreed upon and its costs determined; Project team members are familiar with the substantive and financial reporting processes, and formats and quality standards are agreed upon; The budget (all sources of funding) is understood by all and the rules for its revision are known. Co-financing for the first year of the project from the project partners is verified and confirmed; 54 c. Human resources management and travel The responsible Division/Regional Director can assign an existing UNEP staff member or employ a new staff member the task to establish a project team. Detailed information on recruitment process of the UN staff is available on the Administrative Instruction on the Staff Selection System (ST/AI/2010/3). It should be noted that recruiting a new staff member will take a minimum of 120 days. If the recruitment is project specific (former 200 series), the process should comply with the UNEP Guidelines for Project Related Recruitment. In case the project requires temporary appointments for less than one year, please refer to the Administrative Instructions on Administration of Temporary Appointments (ST/AI/2010/4) Box 8: Human Resources The following actions may be taken in advance of project approval in order to avoid delays in recruitment during project implementation: Reclassify existing posts to add new duties; Review the list of rostered candidates that may be recruited in an expedited manner; Prepare to begin recruitment process at least 6 months in advance of the intended start date; Properly monitor post incumbency and personnel records (e.g. retirement) to inform planning process; and Start building the vacancy pending the approval of the project and related positions. Human Resources Hotline: [email protected] A central "hotline" email address has been established for follow up on staff requests to HRMS. The objective is to provide a One-Stop-Follow-up Hotline for immediate attention to requests which have been submitted to HRMS but not addressed satisfactorily. Staff is encouraged to use this "Hotline" central email address only on the following situations: If you have not received a response (after 5 working days) to a request you submitted to HRMS; If you think that action on your request is taking too long; If you are not satisfied with the reply/service you received; If you have an issue requiring urgent attention (emergency): For HR related suggestions and complaints; For expression of commendations and appreciation of service well-done. To avoid duplication and confusion, please do not copy messages to the Hotline email address when sending your initial request to HRMS. Process for Special Post Allowance Process for Reclassification of a post Process for creating a new post Recruitment process of a staff member (in inspira only) Recruitment of international staff member on an existing post If consultants are to be recruited for the project, Terms of Reference (ToRs) should be developed to define the technical and logistical conditions required to contract for professional services and deliverables from a consultant. ToRs state what is expected from the consultant, and what kind of support the consultant can expect from the project staff. ToRs do not cover contract matters, such as 55 fee and payment methods, which are addressed in the consultant’s service agreement. The service agreement is the legal contract with the consultant which provides financial and administrative terms. TORs are attached to the service agreement as a component. (Click here to see detailed guidance on ToRs for consultants).{ Process for recruitment of consultant} Box 9: Travel Rules of Travel Shipping and Visa Unit in Nairobi Adherence to the 14 day travel directive: The traveller is to obtain 3 quotes where feasible for the mission, at least 2 weeks in advance, to ensure the lowest advance purchase fares are obtained. In order to provide a quotation, the Travel Agents create bookings. The ticketing time limit (TTL) should be clearly indicated on the quotation. Staff can also submit a quotation from an online source if they intend to purchase the ticket themselves. The traveller must ensure that a Travel Request (TR) is raised and certified based on the agreed quotation. The TR should be queued or submitted to the UNON Travel Shipping and Visa Unit (TSVU) for approval no less than 14 days before actual travel. The traveller must ensure that the TR is received in good time before the TTL expires. Please note the process of verification of fares, checking of DSA and final approval takes a maximum of 3 days in TSVU. Please remember to consult the Regional Office prior to field any mission/travel to a country or a group of countries. Requests for exceptional authorization: If the mission cannot be postponed, the traveler should still obtain quotations as per instructions above. The available options should be discussed with TSVU, and the traveler will be advised whether travel should be facilitated through an official ticket or a self-purchased ticket. This discussion should occur prior to any purchase, to ensure that any money paid will be refunded in full. If visas are required, processing times will need to be considered. A memo to the Division/Regional Director (delegation of authority) providing justification for the request for travel within 14 days is required. Without delay, a TR should be created and certified based on the agreed fare. Group travel (staff members): When a group of 10 or more staff members will travel to the same destination, TSVU should be advised as soon as possible to allow them to request a group discount from suitable airlines. If visas are required, the entire group’s passports/UN Laissez Passer should be submitted together to the Visa sub-unit for processing. Travel of meeting participants to Nairobi: TSVU should be notified of meetings in advance to provide an opportunity for them to request group discounts from partner airlines. Substantive office should communicate with the meeting participants to confirm attendance, obtain IMIS index numbers through HRMS, raise and certify TRs at least 21 days before the travel date. A minimum of 21 days before the travel date, a list of all confirmed participants and DSA should be forwarded to TSVU so they may verify correctness of individual TRs, liaise with participants on suitability of itineraries, ensure tickets are processed with names as per passports, issue tickets, and process visas. 56 d. Stakeholder Engagement during Project Implementation During project implementation, Project Managers and their teams involve stakeholders continuously. One common way of doing so is to run stakeholder workshops/consultations at crucial points in the project, such as the kick-off, mid-term, and at the conclusion, in order to validate the results and findings. Stakeholder workshops are not appropriate for all projects, but when planned carefully, they can significantly support achievement of the desired outcome and intended result. Stakeholder workshops can be particularly beneficial because they allow for an exchange of ideas between several groups that may otherwise be isolated, and thereby increase the likelihood of continued communication and cooperation between the stakeholders beyond the lifetime of the project. The role of communication officers is of utmost importance in this process, in ensuring – among others - that the outcome of the engagement is transmitted to a wider audience through adequate channels. A typical kick-off workshop would bring all the stakeholders together (or one representative from each stakeholder group) for one or two days to review the planned project and to generate ideas and reach consensus on possible problems, benefits, and timelines. A mid-term stakeholder workshop could be held to review the results of a mid-term review/evaluation or the results of the first phase of a project, providing an opportunity for stakeholders to raise issues and concerns and provide advice. A results’ validation workshop is common when the output of a project is a policy paper or a set of recommendations that must be implemented by stakeholders and partners in order for the final result to be achieved. Normally comments solicited during the results validation workshop are included as an Annex, and the workshop participants should formally accept the report/results/recommendations. e. Monitoring and Reporting In RBM, the implementation process is significant only in terms of what it leads to – or what follows from the process of planning, managing and implementing. It is important to get to outcomes and not just outputs. The reporting function translates project monitoring into a useful monitoring tool. Monitoring is “a continuing function that uses a systematic collection of data on specified indicators to provide management and the main stakeholders of an ongoing development intervention with indications of the extent of progress in the achievement of desired outcomes as well as progress in the use of allocated funds.” (OECD/DAC Glossary) As such, monitoring is different from evaluation. Table 5: Complementary roles of monitoring and evaluation Monitoring Links activities and their resources to outputs and outcomes Translates desired outcomes into performance indicators and sets targets Routinely collects data on indicators, and compares actual results with targets Reports progress to management and alerts them to problems Evaluation Analyzes why intended results were or were not achieved Assess specific causal contributions of activities to results Examines the implementation process Explores unintended results Provides lessons, highlights significant accomplishment or program potential, and offers recommendations for improvement 57 Monitoring at the project level serves several important functions, including: Guiding the progress of the project (i.e. monitoring provides Project Managers with the information needed for adaptive management towards desired results); Assuring that funds are properly spent, and projects are carried out according to plan; Revisiting the appropriateness of results and plans in light of experience; Informing future projects; and Providing the information needed to undertake evaluation – and demonstrating accountability. One major aspect of monitoring is risk management. See Chapter 8 for more information on monitoring and managing risks. There are several key questions Project Managers should ask when monitoring project processes: Is the project on schedule? – The concern here is about meeting the requirements of the project specifications. If there are variations to the project’s schedule, then decisions are required on whether, and how, to deal with these variations. Does progress with project implementation correspond to expected financial expenditure? There should be a strong monitoring link made between technical progress and financial expenditure. Is the project working as well as it could work? - This can be unpacked into questions such as: ‘Is the project team functioning effectively and productively, both during meetings and between meetings?’ and ‘Are the project’s processes for reporting, allocating work, communication, budget monitoring and the like, reliable and efficient?’ Such questions should be considered, as a matter of course, at each project team meeting and in project reports. The questions should not simply be asked; they should also be answered, and of course the answers should be acted on. There are three additional questions relevant for monitoring the project outputs: Are the outputs being produced on schedule? - This is a question about the extent to which contractual requirements are being met. In case the answer is ‘Yes with exceptions’, a judgment is required as to what remedial action is required. Are the outputs as good as they could (reasonably) be; and if not, in what respects could they be better? - The aim of this question is not to induce a fit of gloom in the project team, but rather to see what could be learned, for future work within the project or for future projects. Again, if some outputs are produced early in the life of the project, then the learning from early assessment can be applied to improving later products within the project. Do the outputs work? or Are they essential to achieve the planned outcomes? – The question is aimed at assessing the effectiveness of the product or process being developed and disseminated. If several products are being developed, they should if possible be developed on a rolling schedule. This allows lessons about the success or effectiveness of the first materials developed to be applied to the design or revision of later materials. Is the project on track to achieve the outcomes? The project should also review whether the necessary project activities to promote the achievement of the outcome are on track. This will require the Project Manager / partners and stakeholders periodically reviewing the Theory of Change for the project design. Have any new ‘pathways’ that may lead to the desired results emerged? Are the ‘impact drivers’, risks and assumptions still valid? 58 UNEP’s Monitoring Policy 18 describes the key elements of required monitoring and reporting on programme performance, and defines the institutional framework for monitoring and reporting. The policy is complemented by a Monitoring Plan, which outlines a schedule and approach for programme performance monitoring and reporting. The plan also provides further details on processes, work plans, and roles and responsibilities in monitoring and reporting. The result of monitoring should be reflected and documented during the reporting phase. Monitoring and reporting at the project level must be directly linked to the achievement of EAs and delivery of outputs in the PoW. [Project Progress Report] One of the main responsibilities of Project Managers is to monitor the performance and progress of the projects they manage. The project document specifies reporting plans for monitoring activities. The logical framework, delivery plan, and budget in the project document are the reference against which actual progress of a project is tracked and measured. Project Managers are responsible for obtaining all the required reports from implementing partners (see table 6 below) and ensuring they are properly documented. FMOs should be consulted in the review and approval of the financial reports. It is also the Project Manager’s responsibility to routinely update PIMS with interim progress toward outcome and output targets and to report against project milestones (See PIMS tutorials for detailed instructions). Once a Project Manager reports in PIMS, a project progress report can be printed. Progress reports should be used by the Project Manager as a tool for reviewing project progress with the rest of the project team, management, and the project steering committee. Six-monthly progress reporting also allows Project Managers to routinely review a project’s approach and business case. If necessary, the Project Manager can propose changes and get approvals from the appropriate authority (See Section G: Project Revisions). The Project Manager should also use the progress report as a tool for discussing project progress with the Project Manager’s first reporting supervisor. In addition to periodically reporting in PIMS, the Project Manager is responsible for routinely uploading reports prepared by implementing partners into the PIMS document repository. Mission reports, and other relevant monitoring documentation can be uploaded into PIMS at any time. Division Directors are responsible for overseeing what is recorded in PIMS under lessons learned, risk assessments, and management actions. The ED holds regular meetings with Division Directors to discuss Divisional performance and decide on corrective actions to improve the efficacy of Subprogrammes. This process is supported by an electronic project-at-risk system in the Programme Information Management System (PIMS). For more details on the project-at-risk system, see Chapter 8, Section D: Project-at-risk System. [Programme Performance Report] 18 The Monitoring Policy for 2010-2011 is now outdated as several changes have been made. A new Policy is expected soon. 59 The Programme Performance Report (PPR) is produced and presented to the CPR annually, providing an overview of UNEP programme performance based on an aggregation of all the other types of monitoring in a given year in order to inform Senior Management and the Committee of Permanent Representatives (CPR). In addition to the annual Programme Performance Reports, UNEP conducts internal semi-annual programme performance reviews similar to the PPR, but for internal use only. QAS prepares the semi-annual report in consultation with Subprogramme Coordinators, and presents it to the SMT for review and action. Highlights of the semi-annual performance review are presented in an oral briefing to the CPR. Aggregated project data for the PPR – including the delivery of PoW outputs, and any progress towards EAs – are derived from PIMS. The reporting data in PIMS are also linked to UNEP’s Integrated Monitoring and Documentation Information System (IMDIS) to meet the reporting requirements of the UN Secretariat. QAS leads the PPR data collection through PIMS, and in consultation with Subprogramme Coordinators and Lead Divisions provides analyses in addition to what is generated automatically through PIMS. The Subprogramme Coordinators collaborate with QAS to review the aggregated data in PIMS, enter performance remarks, and submit supporting documentation. Click here to see the most recent list of PoW reporting focal points for each Division and Subprogramme. PPRs are reviewed by UNEP’s SMT, CPR and the Governing Council (GC). In the case of GEF projects, an Annual Monitoring Report (AMR) is prepared by Agencies and GEF Secretariat on the basis of the GEF fiscal year (July to June of following year), and submitted to the GEF Council. In addition, an Annual Performance Report is prepared by the GEF Evaluation Office using information generated from the annual Project Implementation Reports. Table 6: Summary of UNEP reporting requirements Type Frequency Format Preparation by Submission to Progress Report Six-monthly (end of June and end of Dec); in addition, GEF requires an annual Project Implementation Report PIMS; and electronic or hard copy Project Manager Supervisor and, for GEF, Task Manager validates Mission Reports Whenever a mission talks place (for supervision, meetings, workshop, etc.). GEF projects also recommend Aide Memoires signed with project partners Electronic Person or team who goes on mission Project team and project manger’s supervisor. Expenditure Report Six-monthly (End of June and end of Dec); Quarterly in the case of GEF projects Electronic or hard copy using UNEP format UN and non-UN implementing partners Project Manager and FMO Inventory of NEE (items over USD 1,500) Annually by 31 Jan and within 60 days of project completion Electronic or hard copy to be attached to progress report UN and non-UN implementing partners Project Manager and FMO Audit Report Yearly submitted before 30 Apr of the following year and at the end of the project within 180 days of the completion of the work Original document Non-UN implementing partners Project Manager and FMO Final Report Within 60 days from project completion Electronic or hard copy UN and non-UN implementing partners Project Manager and FMO 60 Final Audited Statement of Accounts Within 60 days from project completion Electronic or hard copy using UNEP format UN and non-UN implementing partners Mid-Term Review (MTR) / Mid Term Evaluation (MTE) Reports Just before mid-point of project implementation Electronic or hard copy Commissioned by Project Manager (MTR)) or Evaluation Office (MTE) Terminal Evaluation Report19 After project completion and before the project closure Electronic or hard copy Evaluation Office Project Manager and FMO Division Director and Project Manager f. Managing Project Information The maintenance of up-to-date information on all ongoing activities (knowledge management) is of utmost importance, as projects’ information and lessons learned may be relevant to future projects and UNEP work. In UNEP, PIMS is the primary repository for project-specific information and supporting documentation. It is responsibility of the Project Manager to carefully maintain all the records and information related to a project, and regularly (perhaps monthly) update the System. Every 6 months a more detailed progress reporting must be entered in PIMS (See Section D of this chapter for more info on the monitoring and reporting process). GEF financed projects must maintain information in the Advance DGEF Database Information System (ADDIS), which holds data of importance for reporting to the GEF Council. In the near future, databases will be merged and finally only PIMS will remain as the database for all UNEP projects. The Project Manager is responsible for maintaining up to date records, including: Financial and progress reports; Progress reports, including specific dates and evidence for outputs delivered and results achieved; Mission reports; Documentation related to project personnel (e.g., recruitment material for consultants, interns, staff, etc.); Legal instruments and related communications and documents; Records of communications with the project team, other UNEP staff, partners, stakeholders and consultants (e.g., meeting summaries and correspondence); Project risks and relevant management actions; Project revisions (including changes in LogFrame, if any); and Challenges and lessons learned. It is also recommended that the Project Manager maintains an email file (or set of files) to keep all communication organized and easily accessible. In addition, the Project Manager should maintain a system of files on his/her computer, backed up on a UNEP shared drive, containing all the relevant documents, meeting minutes, and other information. All the supporting documentation is necessary in case of an evaluation or audit. 19 Management is required to provide a management response to evaluation recommendations. 61 Many projects require information to be shared with partners and/or the public (e.g., project-specific data, maps, national legal and policy frameworks, results of pilot projects and targeted research, etc.). Information may be collected and stored using different media and software programmes. Challenges project teams may face when making the information accessible to partners and other users include: confidentiality of sensitive information, protection of ownership or copyright, translation into appropriate languages, and communicating the availability of such information to interested parties. Information collected during project implementation will have different levels of sensitivity. It is proposed that information be classified as: Confidential (for project management purposes only): This would include budgets, progress reports, informal management reports and reports to the Project Steering Committee. Distribution of such information should be restricted to the contracted project partners, and released to the Project Advisory Groups with the agreement of the contracted project partners. Restricted Circulations: This would include, for example, distribution of draft research papers, technical reports and plans prior to publication. Distribution of such information should be restricted to relevant parties identified by the partners who produced the document. This should prevent breach of ownership rights and pirating of unpublished data. Public Access: All information not included in categories 1 and 2 above. There would be no restrictions on the use of such information, although the source should be acknowledged and any copyright respected. Under normal circumstances, the organization funding a project and the organization implementing the project would retain the ownership rights to data collected and published as a result of that project. The issue of royalties and copyright for any project outputs should be reviewed and agreed on a caseby-case basis. g. Project Revisions Change is a constant factor in the project management environment. Project managers are responsible for continually assessing the project’s business justification and making adjustments to achieve the intended results. Regularly revising and updating the project documents is important for accountability, transparency and effective communication. Project revisions are often due to changes in the project budget. However, since budget revisions are often associated with changes to activities, durations or implementation modalities, project managers have to take the lead in the revision process, while working closely with FMOs. While some routine revisions should be handled between project managers, supervisors or the Division Directors, revisions beyond the division Directors’ delegated authority should be reviewed and cleared at the corporate level. In the case of UNEP projects, thresholds related to project outcomes, milestones, duration, and budget determine whether review and approval is required from OfO or the PRC. Table 7 provides more details and the actions required by the relevant entities. 1. For all types of project revisions, the Project Managers must prepare the required documents shown in the table 7 in consultation with the responsible FMO; Process for carrying out a project budget revision 2. The Project Managers must secure clearance for Project Revisions from their Supervisors; 62 3. Project Managers should then submit revision documents to the responsible approval authority (see Table 7) with the Project Revision Cover Letters ; 4. When the Revision requires OfO approval, OfO may consult the concerned Subprogramme Coordinator, to seek his/her views and suggestions depending on the type of revisions. OfO will provide comments to the project revision, which the Project Manager needs to take seriously into account. Whenever the latter fails to happen, OfO will suspend the project until action is taken. If this situation persists, OfO will close the project in the financial system IMIS. 5. Upon approval, the Project Managers, with help of the responsible FMOs, should update the relevant information in the Programme Information Management System (PIMS); and upload relevant documents in PIMS (any changes related to duration and logframe in PIMS are managed by QAS). Please note that also projects subject to revision must have secured funding for 25% of the total budget, or a minimum of USD 200,000 (whatever is larger), before the fully detailed project document can be submitted. Project revisions result in a project that maintains its original business case. If a project requires such extensive changes20 that they cannot be properly addressed through a project revision, the Project Manager should terminate the current project and formulate a new project to accommodate the changes. The new project formulation will be subject to all the steps required for the development of any project, including a new stakeholder and problem analysis. h. Project Extensions Projects should aim to deliver their results in line with the originally designed and approved workplans. The Project Officer is responsible for monitoring the delivery of a project against its work-plan, and anticipating and mitigating problems as they arise so as to minimize the need for project extensions. Such extensions increase the transaction costs of UNEP (and partners) and result in poor performance ratings. Project extensions may be requested due to external risks (e.g. force majeur) or delivery problems. Requests for extension can be granted but should be treated as exceptional. Extensions of projects often require adjustment to or addition of milestones up to the end of revised project completion dates. If there is no change to milestones, supervisors can approve the project extension. Otherwise, OfO approves the extension requests. For GEF projects, a decision as to whether to grant an extension is delegated to the Task Manager, as long as the extension does not pass one year (or cumulative requests do not pass one year). An extension request for longer than one year requires approval by the Division Director. The Executing Agency is responsible for providing a full justification for why an extension is requested, and it is preferable that the Project Steering Committee endorses the request. In agreeing to an extension, the Project Officer and FMO should verify that the 20 Examples of significant deviation include changes in: Countries or regions selected; Total resource requirements; Division managing the project; Divisions responsible for project outputs; and Linkages to EAs and PoW outputs. 63 original legal instrument is still valid. The Project Officer and FMO should inform the GEF Coordination Office whenever a project completion date is extended, by providing the new dates. 64 Table 7: Process and requirements for project revisions21 Responsibilities Supervisor Division Director Reason for Project Revision Required Documents1 Office for Operations (Incl. PRC if needed) 1. Year-end re-phase and closure Ap 2. Change to the PRC approved budget within the Delegated authority Rv Ap 2. Extension of project timeline Ap or Rv Rv Ap 3. Amendment to the logframe Rv Rv (for changes in outcomes) Ap 4. Change to the PRC approved budget beyond the Delegated authority Rv Rv Ap Rv: Review Original budget table Latest budget revision table Original approved project document Latest project revision document Latest project progress report Latest evaluation report Action sheet2 Ap: Approval 1 Most of the required documents should be available in PIMS. Entities responsible for review, consultation and approval of the revision requests should look at these required supplementary documents for sound decision-making. 2 Signed by Chief of OFO. Delegated authority threshold for the Division Director is usually a cumulative amount of US$500,000 per project. Approval should be by the Division Directors or those who receive delegated authority from the Directors. Supervisors can approve revisions if a project does not require any additional milestones for the extended period. Extensions of projects often require adjustment to or addition of milestones up to the end of revised project completion dates. If there is no change to milestones, supervisors can approve the project extension. Otherwise, OfO approves the extension requests. 21 These processes apply to GEF projects too. Terms may differ in some instances (see other sections of the Manual) 65 6. Resource Mobilization Following the approval of a project concept as part of the Programme Framework, or in exceptional cases as a separate project concept presented after the approval of the Framework, the project manager will need to address the challenging question on how to mobilize the financial resources needed for the development and implementation of the project. For GEF financed projects, once the GEF Council approves/endorses the project, then the GEF grant is considered as completely leveraged. However, the challenge still remains to actually commit the co-financing, whether this is in cash, or in kind. Although the Project Manager has the primary responsibility to fund-raise at the project level, resources mobilization from a corporate perspective is a shared responsibility across the organization, coordinated by Donor Partnerships and Contributions Section (DPC). In order to guide the project managers in how resource mobilization works at UNEP, this chapter presents: A) B) C) D) E) F) a. Roles and responsibilities across the organization; General principles for resource mobilization; Sources of funding: Processes to mobilize resources; Investing in donor relations Resource mobilization with the European Commission Roles and Responsibilities across the Organization Key actors in mobilizing resources at UNEP are: Executive Director/Deputy Executive Director • • Lead resource mobilization negotiations with major donors at corporate level; Provide information and guidance on resource mobilization to DPC, Division Directors and Subprogramme Coordinators, based on intelligence gathered during his/her missions, highlevel meetings, etc. Donor Partnerships and Contributions Section (DPC) • • • • • • Leads and supports a federated UNEP-wide resource mobilization effort and serves as the UNEP intelligence bank on resource mobilization issues; Takes the lead in mobilizing contributions to the EF, working closely with the Regional Offices and the Executive Office; Serves as the UNEP focal point for consultations with the leading donor countries on policy, programme and financial issues; Facilitates UNEP’s interface with donors, in close collaboration with Divisions, Subprogramme Coordinators and Regional Offices, to ensure a coherent and strategic outreach by UNEP to donors; Reviews funding opportunities, circulates information on calls for proposals from potential donors and funding opportunities; Facilitates an inclusive process for the identification and preparation of concept proposals and project documents for submission to potential donors including business, foundations and 66 • individuals, in close cooperation with the Divisions, Subprogramme Coordinators and Regional Offices; Coordinates adequate and timely reporting to donors, in close collaboration with OfO, QAS, Subprogramme Coordinators and the relevant Divisions; GEF Coordination Office • • • • Negotiate GEF co-financing policy with GEF Secretariat and Council; Provide regular updates to Divisions on GEF resources, Least Developed Countries Fund (LDCF), and Special Climate Change Fund (SPCCF) availability; Identify at the strategic level, sources of co-financing, including strategic partnerships or agreements with potential co-financiers, and communicate the same to divisions; Facilitate use of templates and databases for reporting and recording co-financing; maintain a central data base of co-financing sources and amounts for the entire portfolio. Subprogramme Coordinators and GEF Portfolio Managers • • • • Identify priorities for fund-raising within the Subprogramme, taking into consideration inputs provided by project managers, Divisions and Regional Offices; Develop a resource mobilization strategy at the Subprogramme level working closely with DPC, Regional Offices and Divisions; Guide project managers in the development of resource mobilization strategies at project level within their respective Subprogramme. Review and approve these strategies in line with the Subprogramme strategy; Coordinate substantive inputs by project managers into UNEP responses to calls for proposals and other ad hoc funding opportunities, in close cooperation with DPC, Regional Offices and Divisions. Division Directors • • • • • Support development of major cooperation agreements and advise DPC on resource needs and opportunities; Guide the Subprogramme coordinators under the Division in the development and execution of the Subprogramme resource mobilisation strategy Guide project supervisors and project managers on resources mobilization activities in collaboration with the Subprogramme coordinators; Identify and authorize allocations from source of funding within their delegation of authority; Monitor use of resources and takes management actions to ensure that resources available are used in the most efficient way across projects and Subprogrammes. Regional Offices • • • • Provide DPC and Subprogramme coordinators regular information on funding opportunities and donor priorities. The UNEP office in Brussels provides strategic advice and support for partnership building with the European Commission, and on related funding instruments related to (see section E); Coordinate resource mobilization and engagement on specific regional funding opportunities, which Subprogrammes cannot access because the scope is regional and not global; Provide information and guidance on country-level priorities to help shape Subprogramme priorities and fundraising strategies, as well as access to country-level ODA funds. Help coordinate fundraising efforts at national level with relevant partners; Facilitate outreach to governments, as well as to civil society and the private sector in their respective regions in connections with DPC, Subprogramme coordinators and project managers’ efforts; 67 • Help to shape a response to funding opportunity from donors in the region, and assist in responding to them by providing a more precise understanding of what kind of work a donor is looking to fund, what kind of partners the donor would welcome, etc. This understanding allows all colleagues involved to determine whether responding to a given proposal is likely to be worth the time and effort involved. Project Managers The Project Manager has the primary responsibility for fundraising at the project level and are expected to actively raise funds for their projects as they normally know the potentially interested donors for their specific project requirements. However, as shown above, Project Managers can count on the guidance, support and collaboration of a wide network of colleagues at different levels to design and implement their own resources mobilization strategy at project level and secure funds for their projects. As mentioned in chapter 4, UNEP projects must have secured funding for 25% of the total budget, or a minimum of USD 200,000 (whatever is larger), before a fully detailed project document can be submitted for review and approval to the UNEP PRC for review and approval. The project manager is therefore encouraged to identify sources of funding as soon as possible following the approval of a project concept. S/he should work with his/her supervisor, relevant Subprogramme Coordinator, relevant Regional Office Director, and DPC to develop a fundraising strategy for the project. It is his/her responsibility to make the best use of the UNEP internal network and to keep the network informed on resource mobilisation actions taken. Prior to developing a resource mobilisation strategy, Project Managers will want to take the following preliminary steps: Step 1: Produce and resource project preparation budget - Moving from the project concept stage to the development of a full project proposal may require resources. If a project preparation budget is needed (this is not compulsory), the Project Manager should submit a request for funding to his/her Division Director for approval. The Director may authorize an allocation from an internal source of funding, if available, and/or the project manager may contact one or more donors willing to support the development of the project. Step 2: Identify co-financing needs - In developing the fully detailed proposal and defining the project approach (see Chapter 3, Section G: Defining the Project Approach), the Project Manager should try to quantify the amount of resources, whether cash or in-kind, that can be certainly or likely mobilized through the partners in them of co-financing, if any. Step 3: Prepare project budget - Having in mind the overall financial needs of the project and the amount covered through co-financing, the Project Manager shall be able to prepare a realistic project budget, quantify the amount of resources which need to be mobilized by UNEP and identify possible sources of funding. This may include resources already available within the Organization (such as the EF, Cooperation Agreements, etc.; more details are provided in the following section) or additional resources which need to be solicited from potential donors. The resource mobilization efforts will often continue throughout the cycle of the project, if funds secured during the design phase and the early stage of implementation are not sufficient to fully cover the project budget. A GEF project must have evidence of commitment of 100% of GEF financing and co-financing, and the likelihood and strategic value of expected co-finance is one of the review criteria at the IPI stage. GEF Grants are set aside by the Trustee as soon as the project is endorsed / approved, and therefore are 100% guaranteed for the life of the project. Similarly, if some or all of the cofinance is agreed to be channelled through UNEP accounts by the donor, then this is subject to the 68 UNEP donor agreements (as with other UNEP projects) and considered 100% secured. Other cofinance (in cash and in kind) needs to be monitored and tracked on a regular basis. This is done by the project manager and Task Manager who report on an annual basis on achievement of the cofinance targets. In the event that some of the co-financing does not materialize, then the Task Manager is responsible for: i) seeking other sources of financing to replace the lost financing, ii) reporting the lack of delivery of co-financing in the annual Project Implementation Reports, and; iii) working with the Project Steering Committee to adjust outputs and outcomes as relevant. b. General Principles for Resource Mobilization In the context of the federated UNEP-wide resource mobilization efforts, there are both general principles that project managers and all the key players above identified should observe when engaging with donors, as well as specific requirements associated with the different categories of funding sources. Generally: All staff members should remember at all times when interacting with donors, that the priority for UNEP is to increase contributions to the Environment Fund; All efforts to mobilize extra-budgetary resources must involve, at a minimum, one Subprogramme Coordinator, one Regional Office, and DPC. Any staff engaging in resource mobilization efforts should inform, and on a regular basis update, DPC to ensure adequate support and coordination of resource mobilization approaches. Staff members must ensure that any project submitted to a donor for funding has been PRC-approved and that the responsible FMO and the OfO Legal Team have reviewed the funding agreements as early in the process as possible. Staff members should initiate outreach to a donor only after having discussed their strategy with the relevant Subprogramme Coordinator, Regional Office and DPC, to confirm that the project is a UNEP priority for outreach to that specific donor. Each Subprogramme should produce a coordinated set of fundraising strategies for each biennium that identifies, for every staff member managing a programme, which extra-budgetary resources must be raised and which donor(s) to approach for which activities during a given biennium. Where a previously unidentified possibility for fundraising surfaces, staff may pursue it if a new proposal does not jeopardize agreed plans on resource mobilization. This should be determined in consultation with the Subprogramme coordinator, relevant regional offices and DPC. Staff members must also liaise with the Regional Office corresponding to the donor’s geographic area (i.e. the Regional Office for Europe if the donor is a European country or the European Commission) to ensure that there is coherence in UNEP’s outreach to that donor, and this is consistent with any relevant development cooperation strategy. In addition, the staff members shall liaise first with the Regional Offices where an effort is made to mobilize resources at country level, to ensure that outreach is conducted after consideration of how ODA in that country is negotiated and agreed upon at the country level, as this can vary from country to country. It is important that all UNEP’s engagements at the country level harmonize with existing UN efforts in the country. When approaching a non-governmental entity, it is imperative that staff members read and follow the rules identified and set forth in UNEP’s Partnership Policy and Procedures. DPC can provide guidance, as needed. 69 c. Sources of Funding As UNEP is an inter-governmental organization, its primary funding, exceeding 90% of its available financial resources, comes from the governmental sector. Additional extra-budgetary resources may be mobilized through various governmental and non-governmental channels. The funding sources can be grouped within the two main categories of Core Funding and Extrabudgetary Funding: CORE FUNDING UN Regular Budget (RB): The Regular Budget is the core budget of the UN system funded by assessed contributions from Member States. It provides limited funding support to UNEP. The UN Secretariat informs the Executive Office and Office of Operations of funds allocated to UNEP for the biennium. Environment Fund (EF)22: The Environment Fund is the principal funding mechanism for UNEP’s programme of work. All UN Member States are invited to contribute to the Environment Fund on a voluntary basis. The seventh special session of UNEP Governing Council in Cartagena (2002) approved the use of a Voluntary Indicative Scale of Contributions to the Environment Fund (VISC), which set the basis of contribution for each UN Member State. All UN Member States are encouraged to make regular contributions to the Environment Fund using VISC or another basis identified by a UN Member State. DPC, working closely with the Regional Offices and the Executive Office, takes the lead in mobilizing contributions to the EF. {Contributions to the environment fund and extra budgetary resources} EXTRA-BUDGETARY FUNDING (XB) Additional contributions are secured by UNEP in the form of earmarked funding for specific UNEP projects or Subprogramme activities, which are commonly referred to as extra-budgetary resources. They are mobilized through: i. ii. iii. iv. Cooperation agreements with donor countries and inter-governmental organizations in support of specific Subprogrammes or the whole UNEP Programme of Work. These are usually negotiated by DPC, in close collaboration with the Executive Director, Regional Offices and Divisions (e.g. Programme Cooperation Agreement with Norway and Sweden). Earmarked Contributions to support specific projects, which are usually negotiated by project managers in close collaboration with the relevant Subprogramme coordinator and Division Directors. Earmarked contributions include the Strategic Cooperation Agreement with the European Commission under the Environment & Natural Resources Thematic Programme (ENRTP), as well as contributions under other European Commission funding instruments. Calls for proposals by UNEP strategic partners, including the EC, UN Development Account (UNDA), the private sector, foundations and other potential donors. Access to Country-level Official Development Assistance (ODA) provided by the national Development Agencies of donor countries and relevant national recipient Governments. Access is usually facilitated, in coordination with DRC and regional 22 Please note that the UN Secretariat in New York does not consider the Environment Fund as core funding. 70 v. vi. vii. offices, through the One UN process and direct dialogue with national Development Agencies of the main donors and the Governments of the relevant recipient countries. Fund Raising Initiatives, such as events and campaigns in support of major UNEP initiatives and non-governmental sources of funding, such as partnerships with potential private sector donors or partners (e.g. the UNEP Finance Initiative). GEF contributions; In-kind contributions, such as Junior Professional Officers and UN Volunteers The allocation of UNEP’s financial resources is guided by biennial programme of work (PoW) and support budgets in the PoW approved by the Governing Council. These budgets provide overall resource planning for UNEP over the biennium, including: EF allocation by Subprogramme and estimates for XB contributions by Subprogramme. GEF funding is currently not included in the biennial budgets of the PoW, as it is not subject to approval of the UNEP Governing Council. Starting in 2014-15, however, PoW budget will include GEF funding in an indicative manner, to allow for greater synergies between portfolios and more opportunities for “blending”23 projects. GEF funding will still not be subject to approval of the UNEP GC. d. Processes to mobilize resources Environment Fund As previously mentioned, DPC, working closely with the Regional Offices and the Executive Office, takes the lead in mobilizing contributions to the EF. All staff members should, at all times when interacting with donors , remember that the priority for UNEP is to increase contributions to the Environment Fund to support the approved Programme of Work. {Management of donor funds under a strategic cooperation agreement} UNEP allocates the resources from the EF in line with the appropriations approved by the Governing Council for the biennium. Not all of the EF funds are available at the beginning of the year; therefore the Executive Office issues the funds to Divisions in instalments throughout the biennium. Division Directors, in collaboration with Subprogramme Coordinators, are called to allocate the EF funds at the divisional level to deliver specific EAs across the Subprogrammes. Each Subprogramme Coordinator then informs the relevant project managers of the EF allocation available for their project to cover costs related to staff and activities. It is in the best interest of the project managers to keep the relevant Subprogramme Coordinator and his/her Division Director fully and continuously informed about the project’s needs, so they will be able to clearly assess priorities for the allocations of funds. It is also important to show 23 These are defined as projects that contain a packaging of GEF, UNEP-administered and other financing. They must: a) Ensure that the GEF project is directly linked to at least one UNEP PoW Output; ii) UNEP co-financing is clearly indicated and includes both cash and in-kind, and: iii) the same Project Officer is overseeing the GEF and UNEP financed components. 71 that a project is delivering as scheduled, and shows a satisfactory expenditure rate in order to be able to receive additional funds during the biennium. The UN regular budget The UN Regular Budget is not distributed at the project level. It covers only executive and management functions. Extra-budgetary funding Extra-budgetary funding can be mobilized from both governmental {Approval for donor agreements with government entities} and non-governmental donors, including businesses, notfor-profit organizations, foundations and individuals. Some governments provide the bulk of their extra-budgetary resources through cooperation agreements which are negotiated at the corporate level. Alternatively, a project manager or any other staff member might identify a potential donor that is interested in financing specific projects. It is also possible for UNEP to launch a special fundraising initiative to finance high profile initiatives. Fundraising efforts are generally encouraged at all levels, but, as already stated, it is important that all staff members mobilizing resources at the project level work in cooperation with the relevant Subprogramme Coordinator, Divisions and Regional Offices, and inform DPC of the funding opportunity, so that UNEP’s efforts overall are well coordinated and focus on strategic priorities. {Process for resource mobilization commencing from the project manager} The processes to secure and allocate extra-budgetary resources are detailed below based on the mechanisms through which the funds are mobilized: (i) Cooperation agreements DPC, in cooperation with the Regional Office for the donor country, leads the negotiations to develop multi-year cooperation agreements at corporate level (i.e. Programme Cooperation Agreement with Norway and Sweden). During these negotiations, the Executive Office determines UNEP’s preference for the distribution of resources across Subprogrammes, based on an internal consultation. This distribution is then negotiated with the donor, in order to reflect the priorities of the Government in line with their aid development strategy. Each agreement is funded through a trust fund and specifies the level of financing for particular Subprogramme areas, and/or specific project/activities, and sets forth other rules and policies that must be followed when using resources. Donors, such as Norway and Sweden, simply provide resources to each Subprogramme and allow UNEP to determine which projects will be funded. Following the signature of the agreement and the receipt of funds, usually through annual or biannual instalments, DPC requests the Subprogramme coordinators to consult with project managers and Division Directors, and provide the breakdown of allocations at project level. The allocations are authorized by DPC, and reflected in IMIS only if in compliance with the criteria agreed in the donor agreement and with any additional requirements established by the OfO to ensure optimum use of resources. 72 DPC Project managers who are interested in accessing these types of resources are welcome to contact DPC and/or their Subprogramme Coordinator to receive information on on-going corporate agreements, disbursement schedules for the next months, as well as criteria and processes for allocations. (ii) Earmarked contributions at project level Earmarked contributions in support of special initiatives and activities are usually negotiated with governmental and non-governmental donors directly by the project manager or relevant Divisions, although often donor countries engage in discussion on the funding of specific projects directly with the Executive Office or DPC. As noted earlier, project manager are encouraged to work with their Subprogramme Coordinator, the relevant Regional Offices and DPC to identify key potential donors from an early stage of the project design process. Potential donors may be identified through various means, such as the Internet, media, partnerships and other working contacts. When developing a fundraising strategy, project managers should analyse the development strategies of donor countries and their priorities, including thematic and regional country focus. This basic information will be set out in country profiles updated by DPC and the Regional Offices on a regular basis which will be made available online. Additional information can also be obtained from the supervisor, the Division Director, the relevant Subprogramme Coordinator, Regional Offices and DPC. It is important to keep in mind that the contact with the donor should be initiated only after having discussed the strategy with the above-mentioned colleagues to confirm that the project is a UNEP priority for outreach to that specific donor and to facilitate a more informed and strategic contacts with potential donors. The initial contact may be formal (through for example submission of an official letter) or informal (through calls, emails, informal discussions during official event, etc). Once the donors have expressed an interest in financing the initiative through extra-budgetary contributions, the donor may submit an official pledge letter where it is stated its decision to support the project. This is possible only if the donor has no specific requirement or condition. Following receipt of the pledge letter, the project manager has to inform the relevant FMO, who will then request the OfO Contribution unit to issue an invoice to the donor. It is however preferred to formalize the cooperation with donors through a donor agreement, in order to specify and agree on terms and condition concerning the funding, the programmes areas or projects/activities to be funded, use of interest funds, reporting, audits, the use of the UNEP logo, etc.. It is strongly recommended to use the UNEP standard template for donor agreements. Any deviation from the standard template will require clearance and approval from the OfO Legal Unit, prior to finalizing the document. For more information on the donor agreement template, see Chapter 7: Partnership management. For collaboration with the European Commission, please refer to section F. (iii) Calls for Proposals24 24 European Commission related funding mechanisms (incl. call for proposals) are tackled in section F. 73 Governmental and non-governmental donors often provide funding through calls for proposals (i.e. call for proposals by the Director General for Research of the European Commission, KOICA, the German Climate Initiative, etc.). {Calls for Proposals under UNDA (or any other source of funding)} a) Calls specific to a UNEP activity or project Where the call is very specific to a UNEP activity or project (for example intervention following a natural disaster, etc.), the relevant Subprogramme Coordinator, or a designated UNEP staff member under the direction of the relevant Subprogramme Coordinator, will coordinate the response and inform DPC. Usually the response will require the preparation of a concept proposal of 2-3 pages in a format specified by a donor. The response shall be drafted in consultation with the Lead Division Director and the relevant Regional Offices. It is important to underline that the concept proposal prepared for submission to the call has to be based on an already approved PRC-project, or refer to a project concept approved within the Framework Agreement. In this case, the Subprogramme coordinator may clear the submission, following consultation with the responsible Division Director. In the exceptional case where the proposal prepared for the submission does not refer to any approved projects or concepts, the project manager must submit the proposal both to the Subprogramme coordinator for his/her review, and to QAS for PRC approval. For more details, please refer to Chapter 4: Review and Approval. The rationale behind this is that all funding opportunities shall be used to mobilize resources for PRC-approved projects, or at least for projects which clearly show their contribution to the PoW EAs. Resources shall not be dispersed to support stand-alone activities which are not a priority for UNEP and do not contribute to the delivery of the EAs against which UNEP performance is assessed. It is also strongly recommended to consult DPC and the OfO legal team before starting the preparation of a response to make sure that the conditions applying to the call are acceptable to UNEP. DPC will be ready to provide guidance and support in the negotiations with a donor, following the submission, as requested. However, it will be primarily the responsibility of the concerned project manager and/or Subprogramme coordinator to follow-up with the donor until the project is approved and the donor agreement is signed. b) Calls on broader topics When the call for proposal has a broader scope of intervention, it is important that UNEP is able to respond to such potential funding opportunities from a corporate perspective that reflects agreed priorities and inputs from all relevant parts of the organization, while remaining fully consistent with UN rules and regulations. To do so, UNEP needs a corporate process that will maximize its ability to secure resources to engage in priority activities. In specific: 1) Once such a funding opportunity has been identified, DPC will undertake an initial review of the funding opportunity, to ensure that, at a minimum, it fits within the UNEP Programme of Work and to identify the relevant Subprogrammes and regions potentially concerned. 74 2) DPC will next send by email the information on the call for the proposal(s) to the relevant Subprogramme coordinator(s) with a cc to all the Divisions and the relevant Regional Office(s). DPC will request recipients to identify themselves, or a member of their team, if they are interested in participating in further exploration of this funding opportunity. 3) Upon receipt of this email, the relevant Regional Office(s) would be expected to put together any information they can gather on what, more specifically, is being looked for by the potential donor(s) and how likely it is that UNEP might be favourably considered under the call for proposal or other funding opportunity, including if they believe there is a good reason not to pursue the opportunity in question. 4) The relevant staff member of each UNEP Division/Section/Office which would like to pursue the funding opportunity will prepare a brief concept note that sets forth the basic outline of a potential project. The concept note must explain a rationale for submitting the proposal based on its relevance to the UNEP PoW and Strategic Framework, the requirements and priorities of the donor(s) in question and the priorities of the relevant UNEP Subprogramme(s). 5) DPC will next set up a conference call to bring together the Subprogramme coordinator, Regional Office(s) and other colleagues identified through responses to the initial email. The purpose of the conference call will be to: Determine if this funding opportunity is worth responding to, taking into account the workload and costs involved for preparation of the proposal, the relevance to UNEP’s priorities and on-going or planned work and the likelihood of success; and if consensus is there to respond to the funding opportunity; Identify general concepts for proposals – or already approved proposals – and determine whether the project approval process must be engaged; Consider potential partners to be involved; Determine if there may be special legal, financial, and audit requirements; Agree on any further role for DPC or the Regional Office(s) in additional intelligence gathering to get a more specific sense of the interests and priorities of the donor(s); Agree on a process for securing project approval, if necessary; Agree on which individual(s) and Division(s) will be responsible to prepare the proposal; Agree on a timeline for providing the drafts to QAS and/or the UNEP Legal Officer, if applicable, as well as to DPC for review and editing; Agree on the deadline and modality for final submission to the potential donor(s). 6) Where the project(s) under preparation will require QAS project approval, QAS will arrange for a meeting of the PRC to coincide with the timeline set during the call. Similarly, the legal team will liaise with the individual(s) preparing the proposal(s) to ensure that all aspects are covered simultaneously. 7) When the call for proposal requests that UNEP presents only a limited number of project proposals, DPC will request the Subprogramme Coordinator(s) to prioritize the proposals prepared. DPC will submit only the top priority project(s) that best match with the donor’s criteria. The Executive Office may step in to select the top priority proposals from across the whole of UNEP, or to determine broadly the relative percentages to be allotted to each Subprogramme. DPC will follow up with a donor up to the last stage when a project is closed. A call for proposal by the United Nations Development Account (UNDA) may serve as an example of a centralized fundraising activity. UNDA informs DPC of the call for proposals, and DPC invites the Subprogramme Coordinators to coordinate the preparation of concepts/ project proposals for two-year tranches, corresponding with the UNEP PoW biennium. Subprogramme 75 Coordinators prioritize these proposals within their area, and the Executive Office prioritizes the final menu of proposals. DPC then submits the final list of prioritized proposals from UNEP to the UNDA, and follows up with them on the approval/revision/submission of the full scale proposals. DPC also manages the progress reporting by the relevant programme units, in close collaboration with OfO and the relevant project teams. (iv) Country-level Official Development Assistance (ODA) Country-level ODA is another major potential source of funding. Tapping into it is not easy, as UNEP often does not have country level presence. UNEP has, nevertheless, succeeded in several countries, which have agreed to make payments to the EF or to projects/activities in support of the UNEP PoW from ODA country-level funds. These include major donors such as Sweden, Belgium, Norway and Australia. Country level ODA can also play an important role in generating funding for other entities to implement the environmental priorities that UNEP has worked to integrate into country strategies. Getting access to regional and country level ODA funds requires close collaboration between UNEP and National Governments, as well as the regional/country representatives of the Development Agencies from major donors, usually based in the national embassies. The UNEP Regional Offices of both the donor and recipient countries will be the primary UNEP focal point for identifying and pursuing country level ODA funding opportunities, although DPC may learn of such opportunities through contacts at the Embassies in Nairobi or at the Ministries in the capitals. Following consultations with the government authorities, the Regional Office and substantive UNEP staff (project managers, Subprogramme coordinators and/or Division Directors) will, in coordination with DPC, contact the ODA focal points of the major donors based in the relevant country/region and negotiate allocations of ODA funding towards a particular activity carried out by the government. Please note that the original request for ODA must come first from a government authority and only then may UNEP officially step in as a partner facilitating access to the ODA funding. Another way of getting access to ODA funding at the national and regional levels is to collaborate closer with other UN agencies through the One UN process and within the UN Development Assistance Framework (UNDAF). Project managers who are interested in learning more about ODA funding opportunities are encouraged to contact DRC for information on the UNDAF projects, and the respective Regional Offices for further details on ODA funds. DRC, Regional Offices and DPC will work together to provide periodic update on ODA funding. Fundraising Initiatives Fundraising initiatives and campaigns may be organized by DPC, DCPI, relevant Divisions and project managers. These may include on-line contributions, although past experience shows that resources mobilized through this channel has been limited. A special fund/account may be established for such contributions and managed by OfO. The accumulated funds could be then forwarded to a relevant project account These initiatives or events may also involve the participation of one or more donor, usually a nongovernmental entity (i.e. private sector, foundation, NGO, etc.). Given that negotiation with non76 governmental donors and especially private sector may be time-consuming, it is required to enter in a partnership with a donor only if the expected contribution exceeds US$10,000. In other cases any donor is free to make a donation, including personal contributions, directly to UNEP. The staff member reaching out to the private donor must inform DPC and may seek its assistance and advice. DPC may also assist in identifying colleagues within the organization who have additional experience with private sectors’ partnerships and can provide further suggestions based on lessons learned. It is once again recommended to prepare a donor agreement using the UNEP standard template in order to clarify the terms and conditions of the partnership. It is also important to note that, before a partnership with a governmental or non-governmental donor is concluded, the potential partner(s) must undergo a review process in compliance with the UNEP Partnership Policy and Procedures, and when the partnership involves the private sector with the Guidelines on Cooperation between the United Nations and the Business Sector (2009). For more details on partner selection and review process, see Chapter 7: Partnership Management. (vi) GEF financing The rules and procedures for accessing GEF financing are spelled out in various documents available on the GEF and UNEP/GEF websites. GEF financing is available for six thematic areas (called Focal Areas): Biodiversity (implementation of the Convention of Biological Diversity) Climate Change Mitigation (implementation of the United Nations Framework Convention on Climate Change ) Adaptation to climate change, through the LDCF/SCCF (implementation of the United Nations Framework Convention on Climate Change) Land Degradation (or Sustainable Land Management; implementation of the United Nations Convention to Combat Desertification) Chemicals (implementation of Stockholm Convention and Montreal Protocol; as well as support to the Strategic Approach to International Chemicals Management and Mercury Partnerships) International Waters (implementation of regional treaties and protocols) Cross-cutting capacity development (supporting synergies) These funds are managed through a “System for Transparent Allocation of Resources” (STAR) that is approved by the GEF Council and Assembly once every 4 years. The STAR nominally allocates about 70% of GEF funds in the Biodiversity, Land Degradation, and Climate Change Mitigation focal areas to recipient countries, based on a formula derived from combining parameters on governance, with environmental stress. The GEF also has additional windows of financing that are not subject to the STAR system (30%): Global Set Asides in Biodiversity, Land Degradation and Climate Change Mitigation, that are used primarily for financing Enabling Activities (helping countries meet their obligations to the MEAs), global normative projects, and “top up” incentives for regional projects. This includes a small window for Sustainable Forest Management. Nagoya Protocol Implementation Fund, which is a separate fund, set up as a pilot in GEF5 – and it is administered by the GEF in the same manner as the GEF Trust Fund. Earth Fund, which is a separate window within the GEF Trust Fund that aims to motivate the private sector to engage in environmental projects. 77 e. Investing in donor relations The relationship with the donor does not end once an agreement is signed and funds are received. Close collaboration with donors at various stages of implementation, evaluation, completion and closure of the project are important elements in building trust and partnership with them. Success in fundraising also depends on the donor’s previous experience with UNEP. Regular information sharing, involvement of the donor in various outreach activities and continuous interaction can improve the resource mobilization climate and the image of UNEP. It goes without saying, that timely and adequate reporting is extremely important. The project manager has the primary responsibility to ensure that the reporting is provided within the agreed deadline; that the information provided is accurate, comprehensive and exhaustive, and; that results and impact achieved are clearly described. The financial reporting is prepared by the relevant FMO. Reporting may be done in different formats. The donor agreement may specify the use of an adhoc format, or may refer to the UNEP standard reporting template. It is recommended to clearly negotiate the reporting requirements and try to minimize them, as reporting represents a cost for the Organization. Under the corporate agreements with Norway and Sweden, UNEP has, for example, negotiated to use for reporting purposes the annual Programme Performance Report prepared for the Governing Council, in line with the Paris Declaration which calls for streamlining and harmonising reporting to donors and reducing aid transaction cost. DPC and OfO coordinate the reporting where a consolidated submission is requested by the donor, in preparation, for example, of a donor consultation. Official reporting, although critical, may not be sufficient. As previously mentioned, regular information sharing, involvement of a donor in various outreach activities and continuous interaction are recommended. In general, it is also always best to alert the donor of possible changes and/or delays in project implementation, including the redeployment of funds among the budget lines, rather than provide this information at the reporting or evaluation stages. Many donors, in addition, would appreciate being invited to the sites of projects and/or to take part in launching ceremonies or meetings with stakeholders. This is usually a positive experience contributing to further strengthening of collaboration, unless a donor (especially private sector) would like to use such an opportunity for advertising its services and self-promotion. Such intentions should be immediately discouraged, as UNEP cooperation with business should not provide exclusivity in its collaboration, or imply endorsement or preference of a particular business sector entity or its products or services. It is also a good practice to invite to this type of events the Permanent Representative to UNEP of the donor country, as well as of the beneficiary country and to regularly copy him/her on major correspondence on the project. The project manager is also requested to inform the responsible Regional Directors for the donor and the beneficiaries’ countries, and copy them to any major correspondence concerning the project. Showing coordination across the different office in UNEP will improve the image of UNEP in the eye of the Member States. 78 In the case of the GEF, the GEF Coordination Office is responsible for coordinating donor relations at the level of the GEF Council. Task managers seeking donor co-financing for GEF projects should identify possible donors as early as the IPI stage. f. European Commission The European Commission (EC) is a strategic partner of UNEP both on policy and resource mobilization. The EC contribution to UNEP extra-budgetary and earmarked funding has increased significantly over the last ten years. These contributions are extra-budgetary, given that the EU is not a UN Member State and can thus not contribute to the EF. The UNEP Liaison Office in Brussels is the internal focal point for securing and expanding funding possibilities with the EU institutions, in collaboration/supervision with the Regional Office for Europe and DPC. The UNEP Liaison Office in Brussels provides strategic advice and support to facilitate partnership building for resource mobilization with the European Commission under the different funding instruments. The programming cycle of the European Commission is as follows. For each multi-financial framework (7 year period), a set of thematic and geographic funding instruments is established (See Box 10). For each funding instrument, a seven year strategy - a Thematic Strategy Paper or Regional/Country Strategy Paper25 - is being defined by the European Commission, together with the European External Action Service and the EU Delegations, in close collaboration with partner countries. On the basis of these strategies, the European Commission produces MultiAnnual Indicative Programmes (3 years). On the basis of the Multi-Annual Indicative Programmes, the European Commission is preparing Annual Action Plans which include budgetary commitments.26 As such, for each funding instrument, the EC programming process offers three windows of opportunities for partnership building for resources mobilization. Box 10 - European Commission funding instruments for the period 2014-2020 Geographic instruments: European Development Fund – Africa, Caribbean, Pacific ; Development Cooperation Instrument - Asia; Central Asia; Latin America; Middle East; European Neighbourhood Instrument– Eastern Europe & Southern Caucasus and Southern & Eastern Mediterranean countries; Instrument for Pre-Accession – Western Balkans and Turkey; Partnership Instrument – Industrialized and emerging countries; EU Cohesion and Structural funds – EU countries; Thematic instruments: Development Cooperation Instrument , in particular : Environment and Natural Resources Thematic Programme (ENRTP); Investing in People; Migration & Asylum ; Food Security; Non-state Actors and Local Authorities; 25 strategies subject to a mid-term evaluation and refined for the second half of the 7 year period. These Instrument forare Stability; 26 The programing phase of an Annual Action Plan – from identification to implementation - usually takes approximately Humanitarian Aid Instrument; one year. It starts with an identification phase (incl. for example, dialogue/exchanges with partner dialogue with main stakeholders, meetings, commissioning of a scoping study performed by countries, European Instrument for Human Rightspartner and Democracy; consultants, etc.) that leads to a “project identification fiche” (also called “concept note”) that is then further discussed with Horizon 2020 - Framework Programme for Research and Innovation ; partners, before producing the “Action Fiche” (which is the programming document). Competitiveness and Innovation Programmes (EU and close neighbours); Life – Environment & Climate Change (EU and close neighbours). 79 The European Commission is working under 3 main funding mechanisms: a) Direct Grants - As international organizations are becoming important partners for the European Commission, channelling a significant part of external aid funding, a specific management mode under “Joint Management”, after direct negotiations and in the frame of long-term partnership. Under this type of financial mechanism, the European Commission and UNEP are collaborating on: Direct grants regrouped under an umbrella agreement (e.g. Environment and Natural Resources Thematic Programme Strategic Cooperation Agreement with DG Environment and DG DevCo); Direct grants for individual projects. b) Call for proposals (CfP) - CfP are competitive bids that invite candidates to present, within a given deadline, a proposal for action according to the objectives pursued by the EU in the framework of identified development priorities, which are specified in the “CfP Guidelines”. They are used under all European Commission funding instruments. Related “Funding Alerts” are disseminated by the UNEP Liaison Office in Brussels, in close coordination with DPC. There are 2 types of call for proposals, one-step calls and two-step calls: In the case of “one-step calls for proposals”, participants are requested to submit a fullfledged proposal (incl. project description, logical framework, budget and partnership statements) for evaluation by the European Commission; In the case of “two-step call for proposals”, in a first phase, only concept notes are required. On the basis of the screening of concept notes, selected organizations are invited by the European Commission to submit a full-fledged proposal. UNEP is eligible as main applicant for the call for proposal, only if there is a specific reference to “international organizations”, UN organizations” or “Financial and Administrative Framework Agreement (FAFA)” (See Box 11) in the specific guidelines of the call. However, UNEP should in principle not participate as “partner” if the main applicant is not a UN organization, because in this case the FAFA would not apply to the contract. On exceptional basis, UNEP may be considered as a partner, under the condition as defined by OfO. Box 11: Financial and Administrative Framework Agreement The Financial and Administrative Framework Agreement (FAFA) between the UN and the European Commission is the contractual framework of legally binding rules and procedures applying to European Commission funding allocated for implementation by UN organizations. However, not all the European Commission funding instruments are covered by the FAFA (e.g. Research, Life+ and EU internal funds), neither are all calls for proposals. The programme officer has thus to systematically check FAFA compliance beforehand engaging in dialogue with the EC for a direct grant or applying to a call for proposal. Special cases: In the case of DG Research, FAFA is not applying but specific clauses have been agreed between the UN and DG Research to facilitate UN participation. Clauses are addressing: Arbitration; Certificates on the financial statements and/or on the methodology; Controls and audits; Governing Law; Privileges and immunities. Regarding liability issues related to “consortium” or “partnership agreements”, specific clauses might be foreseen in the SSFAs or other partnership agreements between UNEP and its partners. In any case, FAFA compliance has to be checked by the programme officer, with the support of OfO (DPC and Legal Office), Administrative Services Centre and the Liaison Office in Brussels if needed, before submitting a proposal to the EC. 80 c) Call for tenders - Call for tenders are a competitive bidding process for private organizations. The FAFA do not apply to call for tenders. As such, UNEP should never apply to call for tenders. Process to mobilize resources with the European Commission There are two main avenues to mobilize resources with the European Commission: 1. Programmatic partnership building for direct grants This resource mobilization process requires a long-term investment in partnership building at policy and technical level, both with the EU institutions in Brussels (European Commission and European External Action Service) and with the EU Country Delegations. 1A) The ENRTP Strategic Cooperation Agreements Main priorities for collaboration have been defined through a strong policy dialogue and are summarized in the Strategic Cooperation Agreements which address all 6 UNEP Subprogrammes. Specific projects are then selected at a subsequent stage by a joint steering committee. Each Subprogramme coordinator, following consultations with Project Managers and Division Directors, submits to the OfO a prioritized list of project/concept proposals, already approved by PRC, for onward discussions with the European Commission. The OfO is in charge of the overall management and coordination of the ENRTP, supported by a Programme Management Unit, which is a joint UNEP – European Commission unit based in Brussels tasked with the development and implementation of these cooperation agreements. If a programme officer is interested in this avenue of collaboration, he/she should coordinate with the relevant Subprogramme coordinator and contact the Programme Management Unit in Brussels for further information. 1B) Individual projects, under other funding instruments then the ENRTP (see Box 9) Direct grants are a consequence of a strong policy dialogue and consistent partnership building, so as to be involved in the programming process of the European Commission. Continuous policy dialogue and information sharing is meant to enhancing awareness on UNEP policy and programmatic work, and advocating for supporting funds. The objective is to take part to the European Commission internal programming process, and thus progressively position UNEP as a potential partner, based on institutional comparative-advantage. If a programme officer is interested in these avenues of collaboration, he/she should coordinate with the Subprogramme coordinator, Head of Branch and/or Director of Regional Office. The UNEP Liaison Office in Brussels, in close coordination with DPC can provide support and advice on which funding instrument to target and on how to build partnership for resource mobilization. 2. Ad hoc resource mobilization though call for proposals Calls for proposals are competitive bids launched by the European Commission. For external aid, they are managed either directly from Brussels or by EU country Delegations and they are published on DG DevCo’s website and EU country Delegation web site: Given the tight deadlines for call for proposals (usually less than three months), the procedure is the following: 81 1) Call for proposals of relevance for UNEP are identified and analysed by the Liaison Office in Brussels, so as to ensure that they fit within the UNEP Subprogrammes. In case of legal issues, DPC and QAS are contacted for legal advice and clearance. 2) The Brussels office sends the “funding alert” and the related CfP documents for dissemination to relevant Subprogramme coordinators and regional offices, with a cc to all Divisions and in close collaboration with DPC; 3) Interested Subprogramme coordinators (and related programme officers) and regional offices contact UNEP Office in Brussels, cc DPC to express interest. In case different UNEP parties are interested in the call for proposal, DPC will define the proposal to be given priority; 4) The UNEP Office in Brussels is available to provide advice and quality support anytime in the course of the project development, and can perform (at request) a first quality check on logical framework and project description, minimum 4 weeks before the deadline and an overall check, minimum 1 week before the deadline; 5) After submission to the European Commission, internal submission to PRC through QAS is organized. If the proposal is rejected by the PRC, the programme officer will not submit the full-fledged proposal (in case of two-step call for proposal) / renounce to the funding opportunity (in case of on-step call for proposal). 82 7. Partnership Management The term “partnership” is used to describe the relationship between UNEP and external entities with whom UNEP has a formal alliance, collaboration or association (such as governments; major groups and stakeholders including business and industry, academia and research institutions, NGOs, local authorities; and intergovernmental organizations including UN entities). More specifically in UNEP’s programme delivery, partnership refers to the programmatic relationship between UNEP and the entities that UNEP collaborates with in delivering its PoW. Partnerships may involve two or more parties. The value of partnerships in UNEP is recognized in the MTS, which refers to the critical importance of engaging with various partners in delivering on UNEP’s broad environmental mandate. The modes of partnerships in UNEP’s programme may range from implementation agreements on specific issues (e.g. delivering a specific output or activities of a project) to longerterm collaboration for specific purposes (e.g. an institutional engagement with a scientific research institution). Acquisition of goods and/or services do not fall within the purview of partnership, in which case the UN procurement process must be applied. The “UNEP Partnership Policy and Procedures” elaborates how to determine suitable types of partnerships, work flow and responsibilities in developing partnerships, and details of due diligence and screening processes. Please note that that the Partnerships Policy does not apply to: Partnerships with Governments or Governmental Bodies Partnerships with United Nations Organizations UNEP’s cooperation with National Committees Partners for GEF funded projects As regards partnerships with Governments or Governmental bodies, UNEP is bound by the UN rules and regulations, and adheres to the sanction list adopted by the UN Security Council (including for terrorist groups). In case of partnerships with for-profit entities, Project Managers should ensure compliance with the Guidelines on Cooperation between the United Nations and the Business Sector in addition to the UNEP Partnership Policy and Procedure and the Revised Guidelines to Use UNEP’s Standard Legal Instruments. Also GEF financed projects are subject to UNEP’s Partnership Policy and Procedures. The Policy states that GEF projects are exempt from going through the Partnership Committee because they already go through a separate due diligence process within the GEF. However, Task Managers are encouraged to use the tools developed by UNEP to strengthen their assessment of capacities of project partners, including the Harmonized Approach to Cash Transfer (HACT) questionnaire approach. GEF projects are typically undertaken through partnerships with external parties. GEF recognizes two sets of partners: the GEF Agency, who is accountable to the GEF Council for the effective delivery of projects and the “Implementing Agency” functions, and the Executing Agency, who is normally different from the GEF Agency and who carries out the day to day execution of a project. The GEF requires an adequate fiduciary and accountability segregation between these two types of partners. Executing Partners could include governments where UNEP engages 83 directly with by disbursing funds directly to relevant national entities, or they may be a collection of national and regional or global institutions. Other UN and multi-lateral agencies may also be executing partners for GEF projects. In the case of UN entities that are also GEF Agencies (e.g. FAO, UNIDO), the GEF Coordination Office has developed harmonized templates between the agencies for: project documents, PIR, and evaluations. These should be used and adapted to each project. Only some of the MEA Convention Secretariats may be executing partners for GEF projects. Those MEAs for which the GEF is a financing mechanism cannot be executing agencies. Decision to accept MEA Secretariats as executing partners should be cleared with GEF Coordination Office because the GEF policy evolves frequently. In exceptional cases, a project may be directly executed by a UNEP division, in which case the UNEP Policy on Accountability for Internally Executed Projects will apply. a. Partnership Analysis Project outcome and output often require collective efforts of several partners to be achieved. In planning and design of a project, the Project Manager needs to consider whether a partnership is required for execution of the project. Project Managers are encouraged to seek out and utilize partnerships to maximize synergies, leverage additional resources, and increase efficiency. Successful partnership with local institutions can also greatly enhance capacity building activities and increase the sustainability of outcomes. As an organization with limited presence at countrylevel, utilization of partnership is essential for UNEP’s programme delivery. (See UNEP Partnership Policy and Procedures for detailed guidance on partner scoping). Evaluation of potential partnerships should take into consideration the following: To what extent in-house capacity of UNEP versus external resources can be utilized; Efficiency gains of implementing the project by partner(s); What type of external resources are required; and Potential value of partnership in long-term impact of the desired results. A thorough analysis of stakeholders (e.g. the interests of stakeholders, their roles in project delivery, and how best to work with them) can provide a basis for this assessment and identification of potential partners (See Chapter 3, Section D for more details on stakeholder analysis). Selection of partners should also consider evaluation of other organizations already working on similar programmes and projects in the targeted geographical or thematic areas. Relevant Regional Office(s) and Subprogramme coordinators should be consulted for their input on partners at the regional and country level. Priority should be given to organizations that have been reviewed by Harmonized Approach to Cash Transfers (HACT). The HACT micro assessment questionnaire can also be used to screen qualified partners. 84 b. Due Diligence Any partnership that UNEP enters into should be formalized in an agreement, and UNEP recommends the use of the standard legal instruments for this purpose. Once a few partners are identified, the Project Manager should carry out due diligence process. The process provides an opportunity to review the proposed partnership, and manage potential risks and opportunities. It also helps to address audit issues by examining the credentials of the partners and review potential conflicts of interest. UNEP has two-track approach for due diligence depending on the type of partners: for-profit and not-for-profit. The details of due diligence process also depend on whether UNEP is giving or receiving funds (See UNEP Partnership Policy and Procedures for detailed checklist). UNEP may partner with a private-sector entity (for-profit partner) with some exclusionary criteria if UNEP’s role is to help improve their processes. If so, the partnership must be bona fide, and risks must be carefully managed. Criteria used in the process to check for-profit partners are consistent with the Guidelines on Cooperation between the United Nations and the Business Sector and the UN Global Compact principles. The process for not-for-profit entities does not apply to government entities, including line ministries and its subsidiary bodies. While each category involves different set of criteria, both follows the sequence of: A) Exclusion Screening, B) Caution (decision by Partnership Committee), and C) Positive Screening (eligibility criteria). If the partner does not qualify to pass the Exclusion Screening, the partnership cannot be considered. When the partner satisfies the Exclusion Screening, the Project Manager needs to examine the issues under the Special Caution. Due diligence of the proposed partner is further confirmed by the Positive Screening. To perform the due diligence check, the Project Managers need to collect relevant information on the proposed partner including: c. Legal status of the partner institution; The potential partner’s performance during previous experience with UNEP; Evaluation by other organizations; and Audit reports or financial statements from previous years (required of external partners implementing subsets or whole projects with UNEP funds). Legal Instruments Operational details and relevant terms of a partnership should be agreed with the partner in a legal instrument. {Approval process for PCA/SSFA/LOA with funds transfer obligations} {Approval process for partnership agreements (SSFA/PCAs) with non-governmental, not for profit organisations} {Approval process for concluding donor agreement with all parties} Legal instrument is a legally binding and enforceable agreement that helps project management in the following areas: Transparency: specifies rights and obligations of both parties; 85 Accountability: states reporting requirements and due dates, provides templates, and places responsibility on the partner to report on (and be accountable for) how project funds have been utilized; Deliverables: project outputs are clearly defined; Minimum fiduciary standards: may require a partner to be audited by an independent audit authority (a recognized firm of public accountants or, for governments, a government auditor); Exit strategy: provide exit clauses (cancellation, suspension, termination) for nonperformance. The first step is to choose the correct legal instrument for the collaboration, based on the results of a partnership analysis. UNEP has a set of standard legal instruments to facilitate different types of partnerships. The table below summarizes UNEP standard legal instruments. More details on how to use these legal instruments can be found in the Guidance for the use of UNEP’s Standard Legal Agreements. Project Managers should consult their FMO as early as possible to select the most appropriate legal instrument for a proposed partnership. OfO may be consulted for further guidance if required. Table 8: Summary of UNEP standard legal instruments Type When to use Partner(s) Letter of Intent (LOI) To express UNEP’s intention to act upon or to have relationship with partner when detailed commitments cannot by articulated yet (no financial, legal or other commitments can be made). LOI does not require a response from recipient Any Exchange of Letters (EOL) Declaration of interest to use as point of entry for cooperation which will lead to formal/legal instrument. EOL itself does not incur financial, legal or other commitments. EOL requires reply. Any Letter of Agreement (LOA) a) used for partnerships with other UN organizations without project document where no resources are to be transferred (political/programmatic collaboration or common enterprise) b) used with project document where resources are to be transferred between the parties (cooperation for project/programme implementation and sharing responsibilities in joint programming) UN Organizations Memorandum of Understanding (MOU) Used when UNEP does not intend to transfer funds to, or receive funds from, its partner (If resources are to be transferred, MOU requires relevant implementation agreements to detail financial and programmatic/administrative arrangements). MOUs are well suited to define strategic alliance between UNEP and its partner, declaring agreement on areas of common interest, spheres of cooperation and mutual operational engagements. Non-UN implementing partners Small-Scale Funding Agreement (SSFA) Used when UNEP assigns project implementation activities to partner, and transfers less than USD 200,000 (or its equivalent). SSFA must indicate the Not-for-profit non-UN implementing partners 86 Subprogramme to which it is contributing. SSFA should not be used as substitute for Conference Agreements27 Project Cooperation Agreement (PCA) Used when UNEP assigns implementation of set of activities to partner and transfers more than USD 200,000 (or its equivalent). This may require a procurement process. An approved project document or implementation plan must be attached. PCA should not be used as substitute for Conference Agreements Not-for-profit non-UN implementing partners Donation Agreement Used when resources are provided to UNEP. Donors may require use of their own agreement templates. Donors, including private sector and international financial institutions Amendment All of above agreements maybe modified by invoking clause on amendment stipulated therein. Partners with which original agreement concluded While legal agreements facilitate disbursement of funds to partner organizations, legal instruments are not a substitute for procurement of goods and services from consultants and contractors. If the proposed partnership involves the acquisition of goods and services, the Project Manager should follow procurement processes to initiate or enter into commercial contracts. Under no circumstances should UNEP’s standard legal instruments be used to circumvent the UN’s procurement or recruitment processes. The Table 9 provides guidance to determine when it is appropriate to use standard legal instruments and when to initiate commercial contracts for procurement. However, it is to be noted that Table 9 is not an exhaustive list of instances to determine when standard legal instruments are concluded or when commercial contracts may be initiated. Table 9: Standard legal instruments versus commercial contracts Use standard legal instruments when Initiate commercial contracts when Implementation plan developed in collaboration with Implementing Partner UNEP alone develops Terms of Reference for services to be provided Both parties jointly responsible for achieving results of the project Service provider’s obligation usually limited to satisfactory delivery of outputs Purpose of collaboration to establish “partnership” between parties Purpose of collaboration to establish “arm’s length” relationship Based on the standard template of the selected type of legal instrument, a Project Manager should draft legal instruments in consultation with the partner. The standard templates are available on UNEP intranet. Project Managers should use standard legal instruments in order to minimize risk and expedite the approval process; any deviation to the standard templates must be cleared by a 27 Conference Agreement refers to the agreement between UNEP and a host government when UNEP organizes inter- governmental meetings away from its headquarters.It should follow the UN Secretariat’s Guidelines for the Preparation of Host Government Agreements falling under General Assembly Resolution 40/243 (ST/AI/342). 87 legal officer in the OfO. The OfO requires a minimum of fifteen working days to review and clear such changes. All requests for review of legal instruments should be submitted to OfO: Electronically in Word format; If there are any financial implications, from or through the Divisional FMO/Administrative Officer or, in their absence, their alternate, with a copy to the responsible Project Manager. Should the Project Manager wish to submit the legal instrument directly, s/he must copy in any event the FMO, Administrative Officer or their alternate; Copying the relevant Subprogramme Coordinator and the concerned Regional Office(s) or the DRC FMO; Providing the relevant context of the document, including whether there are any relevant governing documents (e.g. umbrella MOUs), and clearly indicating the substantial changes to the documents in tracked changes as well as the reasons therefor as comments in the Word document itself. Project documents should be attached in annex. For GEF-funded projects, UNEP/GEF standard legal instrument templates can be found on the share drive under Legal Instruments or obtained via this link: www.unep.org/dgef/Portals/43/publications/Guidelines_%20DGEF%20templates.pdf. Primary responsibility for preparing and negotiating the legal instrument and its accompanying annexes in this case rests with the FMO, in consultation with the Task Manager. The appropriate UNEP/GEF standard legal instrument (PDF versions only) should be forwarded to new project partners early in the project preparation process by the FMO to inform (and obtain agreement from) partners on their rights and obligations. For further details, please consult the GEF related staff in your Division. A request for review of legal instruments, and exceptional amendment of the same, should first be sent to the GEF Coordination Office, who will use precedence to advice. Should a new case be submitted, then GEF Coordination Office will bring the matter to the attention of OfO. --The legal instruments should provide appropriate means to UNEP and partners to effectively manage and control the relationship towards the achievement of results. Regardless of the format, length and/or complexity of the partnership, the legal instrument must clearly articulate the outputs and/or outcomes to be achieved by the partnership; state roles and responsibilities of each party; and provide adequate measures to reasonably assure achievement of results in accordance with the schedule and other specifications (e.g., specific terms for review and acceptance of services and deliverables). The legal instrument should also clearly set out the budget details and implementation plan for financial management and oversight of the partnership. It should contain sufficient details to justify resource requirements, demonstrate cost-effectiveness, and provide a breakdown of the resource requirements corresponding to the periods for which cash transfers will be made to the partners. (See Chapter 9, Section A and Annex 5 of UNEP Partnership Policy and Procedures for detailed guidance on budget formulation) 88 The administrative costs (e.g. managing, monitoring, preparing substantive and financial reports etc.) associated with the partnerships agreement should normally be borne by the partner. However, in instances where the partner’s capacity is limited, such costs may be included in the budget. When administrative costs are included in the budget, every effort should be made to keep them to a minimum and they should never exceed 13% of the overall budget (PSC, see box 13 in Chapter 9). A key consideration for the effective financial management of the partnership is the level of funding installments and advances. Unless the nature of the activities requires significant exception (purchase or rental of equipment, workshop or large-scale conference, etc.), lower levels of operational advances are preferred: this allows the organization to minimize financial loss by withholding subsequent installments in cases of non-performance. Higher initial installments may be warranted by factors such as the partner’s satisfactory prior performance, low overall cost of the agreement, nature of activities etc. In general, it is recommended to keep the amount of each installment close to the total financial obligation divided by the number of installments. The number of funding installments should be linked to the frequency of expenditure reports required to the partner. For example, if a contract covers 24 months and requires six-monthly expenditure reports from the partner, appropriate number of installment will be four or five. The amount of installments should also correspond with the resources required to achieve the agreement’s major milestones. To minimize UNEP’s exposure to potential risks, terms and conditions of financial, legal and any other commitment should be carefully reviewed by the Project Manager and responsible FMO or Administrative Officer. Finalized legal instruments must be certified by the responsible FMO or Administrative Officer. When a legal instrument is submitted to the FMO for certification, the FMO checks whether: d. there is budget available for budget line quoted; correct bank details are included; financing, reporting and audit requirements are clearly defined and do not contravene the Financial Regulations and Rules of the United Nations; duration of agreement is consistent with specifics of contribution; and project budget tallies with financial implication of the legal instrument. Review and Approval of Partnership Authority for review and approval of a partnership varies depending on the type of partner, modality of partnership, and financial implications of legal instruments. (See UNEP Partnership Policy and Procedures) Main categories can be summarized as follows: 1. When UNEP intends to grant funds that are less than or equal to USD 200,000 to an implementing partner in support of a collaborative partnership for shared results, review and approval process for the partnership can be carried out within the responsible Division, with operational responsibility taken by the relevant Project Manager. 2. When UNEP intends to grant funds that are more than USD 200,000 to its implementing partner in support of a collaborative partnership for shared results, the partnership requires 89 review and approval by an interdivisional Partnership Committee, supported by the concerned Division. 3. When UNEP intends to receive funds from for-profit entities, the review and approval process varies depending on the result of due diligence check. Project Managers should follow detailed steps of work flow and responsibilities within these categories based on the result of due diligence processes. The Project Manager should refer to the UNEP Partnership Policy and Procedures to check detailed requirements. Once the partnership and corresponding legal instrument is approved in UNEP, the Project Manager can proceed to the signing of the legal instrument by all concerned parties. Project Managers should keep record of signed copy of the legal instrument, results of due diligence, and other related documents. All Divisions must maintain an electronic file on each partnership with the following: e. signed copy of legal instruments; results of the due diligence procedure (checklist with score results); memo from Division or Regional Director to the Partnership Committee with recommendation(s); relevant supporting documents such as PRC-approved project document and partnerspecific information (e.g. annual report of the partner showing its status and mission statement); related audit and evaluation documents Execution of a Partnership Agreement Partnerships are defined by common goals and objectives. Project Managers should keep in mind that achievement of desired project outcome is dependent on the implementation of the partnership and delivery of an individual output or activity does not guarantee achievement of the outcome. Therefore, Project Managers are encouraged to have the project outcome reviewed and agreed by selected partner. The Project Manager is responsible for ensuring that the scope, budget and duration of the partnership are clearly defined and aligned with the project parameters. The rationale for the final selection of partners should be carefully described in the project document, along with clearly defined expected deliverables for each partner. The Project Manager is also responsible for communicating to partners the details of reporting requirements and administrative procedures. During project delivery, Project Manager needs to closely monitor the partner’s performance in order to identify any deviations from the planned budget, timeline, of quality of deliverables (See Chapter 9, Section E for more details on monitoring partners’ financial performance). The Project Manager should evaluate and provide regular feedback on the partner’s performance. In general, the implementing partners are responsible for the following: Delivery of the activities or outputs within the agreed conditions in the legal agreement (budget, time and modality of implementation), and in a consultative and collaborative manner; Regular reporting on progress according to the agreed timing and template; 90 Management of financial resources under the relevant legal agreement to achieve the expected results specified in the project document; Maintaining up-to-date accounting information to enable accurate financial reporting; and Producing regular expenditure reports at intervals specified in the project document (minimum every 6 months). It is recommended for partners to retain the following documents: Project Document; Approved budget with all revisions; Annual work plans; File containing all emails or memos from UNEP project team members providing guidance or clarification regarding technical or operational issues; Documents of procurement, especially with high-range value (see Chapter 9, Section C: How to process procurements); Expenditure reports; Cash Advance Statements; Copies of bank statements and reconciliation reports; Inventory of Non-Expendable Equipment purchased against UNEP projects; and Copies of all deliverables (e.g., reports, surveys, studies, training materials, etc.) When there is a major issue with the partner’s performance, the Project Manager should seek advice from, and discuss options with, his/her supervisor and preferably also with project steering committee. In case the intended progress can no longer be achieved through the partnership, suspension or termination of that partnership can be considered. The Standard Legal Instrument Templates web-page (on UNEP intranet) includes specific clauses on suspension and termination in this regard. Closure of a legal instrument is an integral part of the contractual life cycle. Once the Project Manager is convinced that all contractual requirements have been fulfilled by the partner, request for final payment can be sent to responsible FMO (See Chapter 11: Project Completion and Closure for details of related tasks during project completion and closure). f. Audit of Partners The objective of an audit is to provide UNEP with assurance that its resources are being managed in compliance with three criteria: Expenditures have been incurred in accordance with the objectives outlined in the project document; All project expenditures are supported by voucher and adequate documentation; and Proper books of account have been maintained; Although certified financial statements provide some assurance of authenticity, ideally, financial statements should also be independently verified by an external auditor. The agreements exceeding a value of USD 200,000 are required to be audited at the end of their implementation. The audit may be performed as part of the partner’s external audit process when the agreement explicitly says that UNEP’s funding is included in the audit. If this is not applicable, the cost of 91 the audit may be covered in the budget of the implementation agreement. While the audit responsibility would be left with the partner, it should not preclude the audit of the partnership by the Office of Internal Oversight System (OIOS) according to UNEP policies. The audit provision in the revised Project Cooperation Agreement (PCA) template clearly stipulates the obligation of the partner to submit either a consolidated audited financial statement (where UNEP funding is clearly mentioned) or a project specific audit report by an independent reputable audit firm. Generally the partner is responsible to submit the audit reports within 6 months after the end of the partner’s fiscal year. Notwithstanding the above, the implementation agreement provides UNEP with the right to review and audit the records of the partner. Where the amount is less than USD 50,000, or the implementing partner cannot easily or cost effectively provide an audit certificate, the FMO must first confirm that the project manager is satisfied with the implementation of the agreed activities and then review the financial report. In reviewing the financial report, the FMO should, on a sample basis, request proof of payment (payment receipts) from the implementing partner to verify that the partner incurred the expenditures as per the financial report. Standard audit report may consist of the following sections: Introduction: This section presents the contractual basis leading up to the engagement of the auditor. It identifies the project document and any other binding documents such as approved budget, and work plans that establish compliance requirements. It also describes the partner’s participation in the project and the nature of its relationship with UNEP. Scope and Process of Audit: This section provides a listing of all categories of documentation examined and activities (such as interviews with staff) required to form an opinion on the audit criteria. It also describes the process employed to implement the audit. Overall Opinion: The auditor expresses its overall opinion with regard to the partner’s compliance in meeting the audit criteria. Executive Summary: This is a brief summary of the main findings and recommendations. Observations, Findings and Recommendations: This is a detailed description of the main findings and recommendations presented in terms of standards, condition, and recommendations. Findings focus on situations where there is a variance between the standards and conditions, thus the need for a recommendation to close the variance. In the case of GEF financed projects, the costs for audits should be contained in the project budget. Furthermore, an assessment should be made during project preparation as to the capacity of the executing partner to prepare and submit audits on the timely basis required by GEF standards. Should it be necessary, and agreement should be reached with the executing agency, the audits will be conducted by an independent firm. 92 8. Risk Management A risk is an uncertain event or condition that might occur, and which - if it did - would have an adverse effect on results. Risks bring negative impact when they take place. In rare instances some risks can have positive impacts, in which case UNEP regards to them as “opportunities”. The potential impacts of the risks can be anticipated, monitored and managed. Risk management is an integral part of Results-Based Management, as risks are closely linked to project results. For example in implementing a capacity building project for local governments, a major turnover of local government after an election can result in a withdrawal of political support, and have negative impact on the achievement of a project outcome. Therefore, effective management of risks is a precondition for achievement of results, and a well-planned risk management strategy is crucial. Risks differ from drivers, which are still external factors on which the project can exert an influence. The detailed Theory of Change prepared in the design phase of a project is a useful tool to identify risks in the first instance. While identification and assessment of risks should be addressed at an early stage of project design, overall risk management should be considered an iterative process given that potential impact of anticipated risks may change, and new risks can emerge throughout the project lifecycle. Project Managers can prepare and implement risk management strategies at the project level based on the following steps: IDENTIFY Specify the context and nature of risks. ▼ ASSESS Estimate risk values based on the likelihood and severity of the impact ▼ PLAN Plan specific management responses to risks identified ▼ MONITOR Monitor project risks and assess if management response is required ▼ RESPOND Execute the prescribed management responses to the risk GEF projects are subject to a detailed Project At Risk system, that assesses and mitigates risk in four areas: financial, performance, impact, and milestones. a. Identification and Assessment of Risks Project risks can involve both external and internal factors. External risks are those that may occur outside the control of the programme or project, and they represent factors of the project environment including political, economic, environmental, and social conditions. Internal risks are those that may arise from the management of the projects, such as inadequate human resources, lack of clarity in accountability, and corruption in a partner organization. The UNEP Risk Analysis Table can be used as a reference to illustrate different types of risks. 93 As a first step of planning for risk management, a Project Manager needs to identify potential risks in a project. This requires the Project Manager to obtain comprehensive information on the project environment and to understand factors which may affect the project. To acquire a thorough understanding of potential risk sources and characteristics, Project Managers should involve stakeholders, project team members and implementing partners in a risk analysis process. (See Chapter 3, Section C on Planning Project Interventions and Section D on stakeholder engagement during planning and design) A number of techniques can be used for risk identification, such as interviews, brainstorming, and a review of lessons learned from similar projects. For each identified risk, the project manager needs to assess the likelihood (possibility of an event to occur) and the potential impact severity (how the event would affect the achievement of outputs). (See Figure 14 below for a matrix of likelihood and impact severity) This assessment will guide prioritization in risk management and provide basis for selecting suitable management responses. Project Managers are encouraged to use quantitative analyses wherever possible for objective evaluation of risk values. Using the expected monetary value of risks is one of the standard techniques in risk analysis. Figure 14: Likelihood and impact matrix of risk analysis Impact Severity High Low The risk has low likelihood but severe impact when it happens (Need to be monitored) High likelihood and severe impact expected (Require extensive monitoring and management) Low likelihood and mild impact expected (Considered low priority in risk management) High likelihood but low severity of impact expected (Need to be monitored) Likelihood Low High Project Managers should document all identified risks and associated information in the Risk Assessment Table, which is an integral part of the UNEP Project Document. Table 10: Project risk assessment table in UNEP project document Risk Description Category 1 Description Economic 2 Political 3 Organization 4 Financial Impact Severity Likelihood Risk Management Strategy & Safeguards High/Med/Low High/Med/Low Brief text By When/ Whom? Date/Person 94 5 Environmental 6 Social The Risk Assessment Table requires the following information: Risk Description: What is the nature of the risk? (Describe the characteristics) Category: What is the type of the risk? (Economic, political, organization, financial, environmental, or social) Impact Severity: If it happens, how severely would the risk affect the project? (High/Medium/Low) Likelihood: What is the possibility of the risk to occur? (High/Medium/Low) Risk Management Strategy and Safeguards: What are the means to mitigate the risk? (Refer to the management responses described above - avoid, reduce, fallback, transfer, or accept) By when and whom: when or how frequently the risk will be monitored, and who is responsible? (Clear roles and responsibilities in management of the risks should be determined. Stakeholders cannot be given such responsibilities.) Based on the risk analysis and management responses identified, the Project Manager can create a Risk Log keep track of the identified risks. b. Planning Management Responses to Risks Once the potential risks are identified and assessed, the Project Manager needs to take proactive decisions and develop plans for management responses to minimize the likelihood and impact of the identified risks. Management responses to risks can be characterized as follows: Avoid: Change some aspects of project so that the threat can no longer occur or have an impact (E.g., when holding a workshop that can be threatened by political unrest in the host country, the video conference can be used or the workshop can be re-scheduled to avoid disruption) Reduce: Decrease the probability of the event occurring or reduce the impact of the event should it occur (E.g. to reduce the likelihood of adverse effect from fluctuations of exchange rate between different currencies, funding can be installed in separate installments) Fallback: Prepare contingency plan to reduce the impact of the threat should it occur (E.g. if a technical expert is only available for limited period, alternative experts can be identified to reduce the impact) Transfer: A third party takes on responsibility from some of the impact (E.g., in case the project can have significant financial impact from any delays by a contractor, relevant clauses can be included in the legal instrument so the contractor bears the cost) Accept: A conscious and deliberate decision to accept the risk (E.g., when other options for management response to the risk are not feasible due to budget increase or quality issues, the project can make a choice to do nothing and accept the risk. It is strongly encouraged to develop a contingency plan if this type of management response needs to be adopted.) In planning management responses for each risk, the costs of the management responses should be examined against the cost of not managing (accepting) the risk. The Project Manager may want 95 to set aside part of the project budget for a risk management response. Project Managers can refer to the UNEP Risk Analysis Table for different types of risks and relevant assessment and mitigation measures. FMOs can be consulted to identify suitable management responses to financial risks. c. Monitoring Risks Project Managers need to monitor and analyze project risks on a regular basis and implement the management responses as the risks emerge during project implementation. The Risk Log provides a basis for monitoring the risks and associated management responses. Project Managers should maintain and update Risk Logs throughout the project cycle. In monitoring risks, the Project Manager needs to review: If the identified risks have changed or become outdated; If the planned management responses need to be modified; and If new risks have emerged or become known. When the risks are re-assessed or additional risks are identified in the risk monitoring, the Project Manager needs to capture the information in the Risk Log and prepare relevant management responses. Frequent communication with partners implementing a project can be useful to better inform the risk monitoring process. Whenever a risk occurs during project implementation, the project team should refer to the risk management strategy developed during the planning stage and execute the prescribed management responses. If a high-impact risk occurs, the Project Manager is responsible for bringing the issue to the attention of the responsible Director and project steering committee for a decision on a response. When risk management action is taken, the Project Manager should update the risk log. d. Project-at-risk System UNEP maintains an electronic Project-at-Risk system in PIMS to enhance performance management and risk monitoring at the project, Subprogramme and corporate level. Within the Programme Information Management System (PIMS), projects that exceed any of six specific thresholds are considered to be “at risk” until the project is managed to go back to within the thresholds. The system helps identify systematic issues that require corrective actions by project and senior management. The risk thresholds are: Budget Overspending: Projects with accumulative expenditure 5% over the current year’s accumulative allotment (exclude first six months as project is starting up) Underspending: Projects with accumulative expenditure less than 50% of the current year’s accumulative allotment (exclude first six months as project is starting up) Insufficient Funds: Projects with secured funds being less than 30% of the approved budget 96 Performance Off track: Projects with a red (off-track) project performance rating (less than 60% of milestones met in the last 6 month reporting period) Project Cycle Management Slow Maturing Projects: More than 6 months have passed from the PRC review meeting and the projects have not been approved yet (fully signed ProDoc) (this measures corporate efficiency, not projects) Ageing Projects: Projects are ongoing more than 6 months past approved project completion date Unclosed Projects: Completed projects pending administrative closure Based on the automated data generated by PIMS, the ED holds monthly meetings with Division Directors to review the projects at risk, and relevant management actions. It is the responsibility of the Project Manager to ensure that data in PIMS reflects the latest information on the project performance. e. Procurement Risks There are risks in each phase of the procurement process, and there are organizational and commercial measures that can be taken to mitigate those risks. Risks to successful procurement can come from several types of sources, namely: external factors project complexity project planning procurement process fraud, corruption and unprofessional conduct. External factors can include political, economic, and even nature. Among the more frequent external factors are the UN organization and partner government decision making processes that are used to approve activities and their budgets. While political and budgetary factors are generally outside the control of the procurement officer, to reduce the risk of late supply, it is appropriate to begin the procurement process with sufficient lead time, and include appropriate caveats to potential suppliers when a solicitation is issued in advance of authorization, ensuring that it will not lead to binding commitments until and if such authorization is received. Project complexity may lead to objective difficulty in specifying requirements, either because conditions are not fully known or the requirement is subject to change for political or other reasons. Risks can be reduced by early involvement of procurement officers in the project team, and by regularly reviewing the requirement. Where project planning not properly carried out, this can contribute to each of the negative outcomes referred above, as well as to friction in relations among colleagues. The risks can be best reduced through early involvement of procurement officers in planning respective activities to ensure that requirements for and of procurement are properly integrated. 97 The procurement process contains in each of its stages, multiple specific risks and consequences. Managing these risks is part of the professional responsibility of each procurement officer. Fraud, corruption and unprofessional conduct can enter into any stage of the procurement process, producing the risk of loss of organizational resources and budget for inappropriate supply, with corresponding great damage to the image of the organization. For a detailed list of common procurement of typical risks, possible consequences and what to do at each stage the reader is invited to consult the UN Procurement Practitioner’s Handbook at section 4.1 Risk Management. Further indications can be found in the UN Procurement Manual at section 11.27 (Risk Evaluation) and 9.9.16 (Quality assurance). 98 9. Financial Management Financial resources are essential to the delivery of programme and projects and should be properly managed throughout the programme and project cycle. At the corporate level, the OfO leads UNEP’s management of financial resources. In the management of each project, financial management forms a functional area which falls within the overall responsibility of the Project Manager. Therefore, a Project Manager holds the primary responsibility to ensure that the desired results are achieved within the project’s budget. The FMO in the Division managing the project is responsible for providing support to the Project Manager in this area. GEF projects are subject to the same rules and procedures as UNEP ones, as well as the GEF Fiduciary Standards. Moreover, the FMO - in consultation with Task Managers, and subject to review by the PRC and GEF Coordination Office - has to ensure that the fees obtained for GEF Agency functions are not mixed with the project management costs allowed in the project budgets. Finally, the budget set aside for independent evaluations (mid-term and terminal) is not disbursed to the executing agency, but held back and allocated directly to the UNEP Evaluation Office who undertakes such evaluations. The PCA of GEF projects will also stipulate the disbursement schedules and pathways. At each stage of the project cycle, the Project Manager needs to perform related tasks on financial management, as summarized below: PLANNING and DESIGN Understand UNEP’s funding structure and how the project can be funded. Estimate cost for project delivery and develop a budget breakdown based on results hierarchy of the project and the projection of available funding. ▼ REVIEW and APPROVAL Ensure the project has at least 25% of total budget, or USD 200,000 (whatever is larger), secured for PRC review28. Once the project is approved, initiate a project accounting process in IMIS with the responsible FMO. ▼ IMPLEMENTING and MONITORING Facilitate payments for expenses and procurement for necessary goods and services to deliver activities in accordance with project delivery plan. Monitor project’s financial performance and take necessary management actions (e.g., budget revision or adjustment). ▼ COMPLETION and CLOSING Make sure the project is operationally completed within budget, and finalize administrative processes for formal completion and closure. For detailed tasks, see Chapter 11: Project Completion and Closure. 28 This applies also to projects subject to revision 99 a. How to develop a project budget In RBM, the desired results of project design drives budget formulation process, which is described in the figure below, and the financial performance can be later measured against the results. Budgeting at output level should be aligned with budgetary analysis and human resource requirements of total project budget, and linked to expenditure items. Once the budget has been decomposed to the unit cost level, it can be re-packaged through the logic of project intervention. Based on the detailed breakdown of budget, the Project Manager can aggregate the budget by project outputs and activities. Figure 15: Budget Planning for Results Outcome to achieve To achieve this outcome what outputs need to be delivered? To deliver these outputs what activities need to be carried out? To carry out these activities what type of resources do we need? How many unit of each type of resources do we need? What is the unit cost of each type of resources? The Project Manager is responsible for developing detailed project budget based on cost estimates for delivering output and activities planned in project. In this process, the Project Manager should actively engage with the responsible FMO to ensure compliance with Financial Regulations and Rules of the United Nations. The Project Manager should also consult the relevant Subprogramme Coordinator who provides guidance on consistency with the Subprogramme budget. The UNEP project budget format guides the process with classification of costs by nature (what UNEP is paying for). In case a partner organization uses different budgeting approach, a crossreference table should be developed still in UNEP project budget format. FMOs can provide guidance for budget estimates based on standard unit costs. 100 UNEP uses the Integrated Management Information System (IMIS) for processing and accounting project budget, and the expenditure items in project budget should be recorded in accordance with IMIS budget code (See Table 11). FMOs hold main rights to access and manage information on IMIS. If necessary, a Project Manager can request viewing rights for IMIS. Table 11: UNEP Project Budget Format and IMIS Budget Code IMI S Cod e10 Budget by Project Output UNEP Budget Categories 1 2 3 4 1100 Project personnel - 1199 Subtotal 1200 Consultants - - - - - 1300 Administrative Support - - - - - - - - - - - - - - - - - - - 1399 Subtotal 1600 Travel on official business 1699 Subtotal 1999 Component total SUBCONTRACT COMPONENT 2100 Subcontracts (UN organizations) 2199 Subtotal 2200 Subcontracts (Non-UN organizations) 30 TRAINING COMPONENT - - - - - - - - - - - - - - - MISCELLANEOUS COMPONENT - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 5199 Subtotal - - - - - - - - - - - - - - - - - - - - - 5299 Subtotal 5300 Sundry - - 5100 Operation and maintenance of equipment 5200 Reporting costs - - 4299 Subtotal 50 - - 4199 Subtotal 4999 Component total - - 3399 Subtotal 4200 Non-expendable equipment - - 3299 Subtotal 3999 Component total EQUIPMENT AND PREMISES 40 COMPONENT 4100 Expendable equipment - - 3200 Group training 3300 Meetings/Conferences - - 2399 Subtotal 2999 Component total - - 2299 Subtotal 2300 Subcontracts (for commercial purposes) - - 1299 Subtotal 20 Total PERSONNEL COMPONENT Budget by calendar year YYY Total YYY YYY Y Y Y - - - - - - - - - - - 101 5399 Subtotal 5400 Hospitality and entertainment - - - - - - - - - - - - - - - - - - 5499 Subtotal 5500 Evaluation 5599 Subtotal 5999 Component total 99 GRAND TOTAL - - - - - - - - - - - - - - - - - - - - - - - Project Personnel (1100): Each post should be identified by- a post number and recorded on a separate budget sub-line. Full job descriptions should be attached. (The title of the post and grade should be indicated). Budgetary provision should be expressed in USD equivalent, and in work months for each year of the budget; the minimum unit for posts is a half-month. Actual salary costs should be used where known, with the addition of an estimate for travel on recruitment, separation, home leave, and education grant – common staff costs. Where these are not known, standard costs by grade should be used, as amended from time to time. Standard salary costs include provision for travel on recruitment, home leave and repatriation, as well as education and separation grants. Travel on official business should not be budgeted under 1100. Staff training costs can be budgeted under 1100. (Note: The approval of the ED is required for all new posts.) Consultants (1200): Consultants' services (covered by Special Service Agreements (SSA)) should be budgeted on a separate budget sub-line (one consultant per line). Terms of reference for each consultant should be attached. Standard costs, as revised from time to time, should be used to calculate costs. These include provision for fees, travel and per-diem. Where actual costs are known, these should be used instead of standard costs. For projects executed by a cooperating agency or a supporting organization, this subdivision excludes consultants hired directly by UNEP (they should be budgeted under line 1281). Only individuals can be offered SSA; firms are offered contracts (see sub-component 20 for subcontracts) Administrative Support (1300): Administrative support personnel include: a) Administrative assistants (as distinct from professional administrative officers), secretaries, typists, clerks, drivers, and; b) Translators, revisers, interpreters and conference typists (recruited for meetings). Full job descriptions for each of the above should be attached, including the title of the post and grade. Items such as temporary assistance and overtime should also be budgeted under this subdivision. The above rules for budgeting for 1100 also apply (Note: For internally implemented projects and costed work plans, approval of the Executive Director is required before a new post is included). Travel on official business (1600): All mission costs (travel costs and per-diem) relating to the travels of project personnel on official business (other than travel for recruitment, home leave and repatriation which are budgeted under 1100 and 1300) must be included under this budget subline. For internally implemented projects - other than those implemented by a UNEP regional office or units outside Nairobi which are budgeted under 1681 - travel undertaken by UNEP personnel, including travel to meetings, should also be budgeted under 1600. Travel of UNEP staff under 1600 should be project activity oriented and reflected in the project work plan. Subcontracts (20): Where external organization(s) have been subcontracted, the project budget should include each organization’s name, indicative budget, specific activities and outputs, and timelines for delivery. The following contracts should not be included under this budget sub-line: 102 Personnel contracts – lines 1100; Consultancy contracts – lines 1200; Repair and maintenance of equipment – lines 5100; Equipment purchases – lines 4100 or 4200; Printing and publishing contracts - Lines 5200. Group Training (3200): This item should be used for budgeting participation in training courses, seminars, workshops, study tours, and so on. The cost of travel and per-diem should be separately estimated for each training course or workshop. Meetings or conferences (3300): Budgetary provision should be made for the total estimated costs of participation in meetings, conferences, and so on. The approximate number of participants should be indicated together with tentative dates and venue. UNEP staff participation (travel and per-diem) in meetings and study tours should not be included under any of the above lines, but under lines 1600 as appropriate. Equipment and Premises Component (40): See section C: How to process procurements for more details. Operational and maintenance of equipment (5100): Operation and maintenance of office and computer equipment; repair, maintenance and insurance of vehicles; purchase of petrol, and rental of meeting room and equipment can be budgeted under this line. Reporting Costs (5200): Estimated or standard costs should be budgeted for editing, translation, printing, and distribution of reports and publications, and shown under separate budget sub-lines. Sundry (5300): This item covers expenditures such as: freight and port clearance charges, postage and communications costs. Hospitality and Entertainment (5400): This item covers the hospitality expenses incurred in connection with receptions given in honor of participants in conferences, seminars, and so on, held under the project. Where hospitality or entertainment costs are involved, the reason for, the type of hospitality, and the numbers invited should be indicated precisely. Expenditures should be incurred in accordance with the official hospitality guidelines (see ST/AI/192/Rev.2 dated March 1993). Evaluation (5500): Project budgets should include a separate budget line for mid-term evaluations (if the project extends over the duration of the MTS)29 and terminal evaluations (all projects) to be assigned to the Evaluation Office to conduct independent evaluations. 29 Mid-term evaluations are conducted by the Evaluation Office only if: a project is of key strategic importance to UNEP and at risk. Mid-term evaluations are otherwise only mandatory for projects that extend for the duration of the Medium-Term Strategy or longer. For projects of a shorter duration, the mid-term examination of a project’s performance is viewed as an internal project management tool and is referred to as a mid-term review. For those projects, the responsibility for mid-term reviews rests with project/programme managers. 103 The currency of reference for UNEP is the United States dollar (USD). Budgeting with partners should be also established in USD. Where necessary, the value of budget items in other currencies can be determined by applying the UN operational rate of exchange in effect. Project Managers should also keep in mind the following issues when developing project budgets: Project Preparation: Project Managers can use a portion of available EF resources or XB resources (not exceeding 10 percent of the total project budget) to strengthen project quality (e.g. stakeholder consultations). If the Project Manager wishes to use funding for project preparation, it should be approved separately using UNEP Project Preparation Proposal Template. Environment Fund: Any EF contribution to the project should be deducted from the total resource requirement. However, EF resources (both cash and in-kind contributions) should not be included in the budget table. Communication: All projects should include provisions (generally 5% of the total budget) for communication and outreach activities. DCPI should be consulted in identifying their specific roles and responsibilities for the communication of the project. Monitoring: Project budgets should include provisions for data collection and monitoring, determined by the Project Manager in consultation with his/her supervisor and the project steering committee. Evaluation: Projects with total budget more than USD 500,000 should have a separate budget line assigned to the Evaluation Office for project evaluation, and this evaluation budget cannot be adjusted or moved to a different budget line without consulting the Evaluation Office. If a project has a total budget less than USD 500,000 then 1) the evaluation budget lines might be lumped with other smaller related projects to undertake an ‘umbrella’ evaluation; or 2) the project itself might undertake a review as the Evaluation Office does not conduct individual project evaluations for projects with a total budget lower than the threshold of USD 500,000. The following rule of thumb can be used to estimate an appropriate evaluation budget: all project evaluations require a minimum budget of USD 25,000, while evaluations’ budgets will exceed USD 100,000 only in very exceptional circumstances. The budget can be constructed by estimating the number of consultants required to carry out the evaluation, and the number of sites or countries to be visited for evaluation. In general, a good estimate is USD 20,000 per consultant and USD 5,000 per country in the evaluation. Where key partners and stakeholders do not read/speak English, and additional $5,000 should be budgeted for translation. After receiving the request for conducting the evaluation, the Evaluation Office will verify whether an adequate evaluation budget is available, and might request the managing Division to mobilize additional funding to increase the evaluation budget to an adequate level. Budgeting for evaluation can therefore best be done in consultation with the Evaluation Office. Auditing: For project externally executed and PCAs, the executing partner needs to provide UNEP with yearly financial audit reports, including at the time of the project’s closure considering the project’s entire duration and its corresponding transactions. The costs of these audit requirements are to be borne by the project budget. Retention: UNEP retains 10% of the project value given to implementing partners until such time when it is in receipt of 90% of the financial expenditure reports (Audited expense reports from non-UN entitles) from the implementing partners. Once the condition is met, the remaining balance required to complete the project will be issued. 104 Box 12: Co-Financing in UNEP For non-GEF projects in UNEP, co-financing refers to cash and/or in-kind contributions committed by governments, other multilateral or bilateral sources, the private sector, NGOs, and project beneficiaries, who are partially contributing to the delivery of project activities or outputs. However, these resources are not channeled through UNEP, which means UNEP does not manage or monitor the resources. Co-financing is not a mandatory requirement for non-GEF UNEP projects, but strongly encouraged to strengthen commitment of partners, increase long-term sustainability of the project, leverage additional resources from other donors, and improve economic effectiveness of the project. Co-financing information is important in understanding the overall resources available for the project delivery. However, funding administered directly by the partners, and not channelled through UNEP, should not be part of the total project budget calculation. Although co-financing is not included in the total planned budget in UNEP, Project Managers are encouraged to provide relevant information in budget table (as footnote), project document and progress reporting. If possible, the project steering committee can be used to review commitment, compliance, and expenditure of co-finance. For 'GEF projects', co-financing means project resources (cash or in-kind) committed from non-GEF resources to meet the 'GEF-project' objectives. It is mandatory for UNEP and executing agencies to provide or generate co-financing, and the sources of co-financing can include, but are not limited to, the following: UNEP’s own financing; government financing as counterpart commitments (e.g. for baseline or foundational activities in the project countries upon which the project would build, or without which the project could not be implemented); contributions mobilized for the project from other multilateral agencies, bilateral development cooperation agencies, NGOs, the private sector and beneficiaries, etc. GEF is not a donor organization and it only tops-up existing initiatives to achieve 'a global environmental benefit'. As such, the ratio GEF funding and funding from other sources for a project is at least 1:1, sometimes reaching 1:4 in UNEP projects (and higher in projects led by the multilateral banks). This however, strongly depends on the country and the type of intervention which is proposed. For detailed guidance, see GEF Council Document on Co-Financing (GEF/C.20/6/Rev.1) b. How to access secured funding Project Managers should submit projects to QAS for review by the PRC when the proposed project has secured funding of at least 25% of total budget with a minimum of USD 200,000.30 This includes EF contributions and staff costs. It should be noted that funding secured by Trust Funds or Earmarked Contributions include Programme Support Cost (PSC - for more details please see the box below). When only a partial amount of project budget is secured, Project Managers should develop a budget table for the particular amount of secured funding. For example, if the total project budget is USD 3 million and only USD 1 million has been secured, the Project Manager should develop a budget table for the USD 1 million in addition to the budget table for total USD 3 million. Project Managers are encouraged to design a phased approach to roll out the project when challenges are expected in securing project funding in full. Project Managers should at all times share up-to-date information on secured funding with the responsible FMO. 30 This applies also to projects subject to revision 105 In the case of GEF projects, the GEF Trustee issues, on a monthly basis, a Letter of Commitment (LoC) for the projects approved/endorsed by the GEF Chief Executing Office in the preceding month. The LoC is a confirmation that funds are available for spending by UNEP/GEF. Funds for projects are then drawn down from the GEF Trustee, through a request submitted by the GEF Coordination Office on a regular basis. The request for funds is triggered by the fund balance in IMIS, reducing below threshold agreed with the GEF Trustee. Note that the request is against cumulative GEF project budgets approved/endorsed, and not on a project-by-project basis. As such, the total project grant is not available upfront for disbursement. Project funding is accessible only after the legal agreement (PCA/SSFA) is signed off between UNEP and executing partners, and the project account created in IMIS. For UNEP executed projects, funds can be accessed once the project is approved (i.e Decision Sheet signed off) and project account created in IMIS {Process for project creation in IMIS}. The interest income earned on the project finance is reported and returned to the GEF Trustee on a six month basis. Box 13: Programme Support Costs and GEF Fees Programme Support Cost (PSC) is a term used in the UN for the charge expressed as a percentage of direct costs that UN collects on extra-budgetary expenditures. PSC rate for XB funds should be 13%, unless otherwise formally agreed to, and approved by, the ED. The rate of 13% was decided in the General Assembly resolution A/RES/35/217 and applies to UNEP as a programme of the UN. The PSC revenue is used to ensure proper funding of corporate services in operational management, and that the indirect costs of supporting activities for XB contributions (project appraisal, administration, recruitment, etc.) is not borne by the core resources of UNEP. Administration and management of PSC is subject to UN policy set out in administrative instruction ST/AI/286. For all secured funding, the PSC rate and amount should be listed in UNEP project document (duration and cost table). The rate should be indicated separately per funding source unless they all have the same rate. The PSC rates should be calculated only from the direct costs for the project implementation (the costs that can be clearly attributed to the operation of the project). GEF Implementing Agencies also receive fees (10%) to cover costs related to: a) the fulfilment of corporate responsibilities related to institutional relations, policy and program development/management/coordination, outreach/knowledge management/external relations, management and finance and M&E, and; b) the provision of project cycle management services, including: due diligence management, quality assurance and oversight of a project through the entire project cycle (development, preparation, supervision, and evaluation. GEF projects are allowed to budget Project Management costs up to a maximum of 9 % as part of the project budget. Specific rules apply to what can be included in Project Management costs and what not. Please refer to the “Proposal for a Fee-Based System for Funding GEF Project Implementation, April 7, 1999 – GEF/C.13/11.) Main and sub-projects Once the project document is approved by the PRC, the FMO (of the Division managing the project) requests for the creation of a Counterpart project number in IMIS, which will serve as umbrella. The main project is an empty shell under which a tree of sub-projects and sub-account will be anchored. Once the main project is created, the FMO will initiate the "pink file" process in the UNEP information system, on the basis of the elements approved by the PRC and mentioning the financial contributions already secured for the project. Depending on the installment of secured funding and on the project’s legal instruments, FMOs can create subprojects and subaccounts in IMIS under the main project, and link them to the project account. FMOs can create sub-projects for specific funding sources, initiate sub106 allotments when a different Division needs to deliver some outputs under the same funding source, or create a sub-account when a significant share of the funding source (over and above 200,000 USD) is to be sub-contracted to a third party. It should be noted that “subaccounts” for legal instruments or “subprojects” for partial activities within a main project cannot be considered a “project.” Any project involving operations at the regional or country level should include a budget line for the relevant Regional Office(s). Whenever an additional contribution is being secured within the limits of the PRC approved project, the contribution is reflected in the next budget revision. In case secured contributions are over and above the budget of the initial PRC approved project, the increase is approved by either the Division Director or the PRC (over 500,000 USD), depending on the respective Delegation of Authority. However, QAS needs to be consulted at all times, to make sure that the project will be registered in PIMS. Allotments are approved to the maximum level of funds actually received. FMOs should ensure that the EF allotment in IMIS is aligned with the EF allocation for the Division within the Subprogamme, and that XB allotments in IMIS are based on funding already received by UNEP. If secured funding is to be received in separate installments, project should incorporate this in a project delivery plan with a phased-approach. To make sure that the financial data are accurately reflected in project reporting via PIMS, FMOs should apply the following principles: Only link accounts in IMIS that are relevant to the main PRC-approved projects once agreed by the Project Manager of the main project (not the manager of individual subprojects or accounts). In those exceptional cases where a portion of subaccounts from projects from the previous biennium needs to be linked to a new project account, the FMO should get the consent of the Project Manager of the previous project account before creating any linkage. However, FMOs are strongly encouraged to only link new secured funding for that IMIS account of projects, and financially close the accounts of the older projects. Box 14: Roles and Responsibilities of Certifying, Approving, and Authorizing Officers 107 In accordance with the Financial Regulations and Rules of the United Nations, to ensure checks and balances, financial management processes involve different functions performed by: Certifying Officer: Certifying function means the authority to determine that funds are available in line with their programmatic purpose for a specific commitment, obligation or expenditure within the duly defined process. Typically the FMOs are nominated as certifying officers in UNEP. For more details on the roles and responsibilities of certifying officers, see Rule 105.5 of Financial Regulations and Rules of the United Nations Approving Officer: Approving function means the authority to establish obligations and the recording of expenditures, after having verified that they are in order and have been certified by a duly designated certifying officer. Approving authority and responsibility is assigned on a personal basis and cannot be delegated. An approving officer cannot exercise the certifying functions or the bank signatory functions. In general, approving function rests with UNON. For more details on the roles and responsibilities of approving officers, see Rule 105.6 of Financial Regulations and Rules of the United Nations Authorizing Officer: Authorizing function refers to the mandate to initiate a transaction for the purpose of achieving an output in line with an approved project. Usually Division Directors hold the authorizing responsibility, but it may differ depending on the delegation of authority. As an authorizing officer, a manager can authorize procurement requests for goods, services and facilities in line with the UNEP Procurement Manual. c. How to process procurements The procurement of goods and services for UNEP projects is subject to Financial Regulations and Rules of the United Nations, and should follow the policies and procedures outlined in the UNEP Procurement Manual (2012). Within the terms and conditions of applicable legal instruments, the implementing partners may procure goods and services according to their own procurement policies and procedures, but should ensure that the external procurement process meets international standards. When there is a need for procurement, Project Managers should engage FMOs to develop generic specifications to fulfill such needs. FMOs are responsible for verifying availability of funds for the required procurement and making a formal request to a Procurement Officer in UNON or an alternate organization depending on the arrangements of the field missions. All UN organizations have agreed on the following four principles in procurement: • • • • Promotion of UN objectives; which includes maintaining the highest image and reputation of UNEP, promoting public good and the specific objectives of the Organization. Fairness, integrity and transparency through competition; this requires guarding against collusion and ensuring competitive processes are conducted on the basis of clear and appropriate regulations, rules and procedures that are applied consistently to all potential suppliers. Economy and effectiveness; this means providing an appropriate solution to the Organization’s need with regards to quantity, quality and timeliness at the right price and conducting the procurement action efficiently. Best value for money; does not necessarily mean the lowest initial price option, but rather represents the best return on the investment. The UN R&R define the following types of methods of solicitation: 108 1. Low Value Procurement; for UNEP the threshold is USD 4,000 2. Informal method: a. A Request for Quotation (RFQ) shall be used for the procurement of simple, uncomplicated goods of standard and firm Specifications (very clearly defined and continuously used deliverables) of total estimated value not exceeding US $40,000 3. Formal methods: a. An Invitation to Bid (ITB) shall be used for the procurement of goods and services of standard and firm Specifications (very clearly defined or continuously used deliverables) of the total estimated value in excess of US $40,000 b. Request for Proposal (RFP) shall be used for procurement of deliverables that cannot be quantitatively or qualitatively expressed in sufficient detail to allow use of an ITB at the time the Solicitation Document is issued, such as for professional services or similar services. Each of the methods defined above has a unique set of standard operating procedures, roles and responsibilities and standard documents that are required in order to successfully carry out the procurement exercise. In general the procurement process follows steps that are: Prepare the requisition: requirement definition involves defining and describing what is needed and will be procured, collecting information, specifying appropriate solutions in specifications for goods and equipment, terms of reference (TOR) for services, or statement of works (SOW) for works. Specifications, TOR and SOW constitute the technical basis for the solicitation and the evaluation of offers to determine if they satisfy the requirements as stipulated in the solicitation documents. They become the “heart” around which the eventual contract is written and later administered. They have an effect on the procurement that lasts its entire lifetime - from planning, through bid evaluation, award and contract performance up to completion and post-contract evaluations. A clear and appropriate definition and description of the need is of utmost importance. The requirement definition is formally the responsibility of the requisitioner. It requires Project Manager’s professional assessment in consultation with FMOs. Generic specifications should be developed to define the minimum requirement. Prepare Source Selection Plan (SSP): the SSP is an internal and collective document, under the leadership of the procurement officer, which describes critical components of the acquisition process and provides justification for sourcing and procurement decisions in order to achieve the Best Value for Money principle. Depending on the complexity of the procurement, the SSP may be summarized in a few lines, or consist of long and precise descriptions of the steps necessary for the evaluation. The Procurement Officer and the Requisitioner are jointly responsible for preparing the SSP before the solicitation documents are issued. Sourcing / Solicitation and Evaluation: There are three different solicitation documents: Low Value Procurement (less than USD 4,000): Offices Away from Headquarters have delegated authority for purchases of amounts less than USD 4,000. Please refer to the UNEP Procurement Manual Section [insert] for the detailed procedure Informal method of solicitation ($4,000 to $40,000): preliminary examination and evaluation of the quotes received and considered to be valid, to assess their responsiveness to specifications and requirements as defined in the solicitation documents, 109 analysis of their costs and benefits, and determination of their price and value. (UN Financial Rules and Regulations 105.16 (a)(x)) Please refer to the UNEP Procurement Manual Section [insert] for the detailed procedure Formal method of solicitation (in excess of $ 40,000): An Expression of Interest (EOI) needs to be posted on the UN Global Market Place for all procurement actions in excess of $40,000. A Source Selection Plan (SSP) needs to be signed by both the requisitioner and Procurement prior to issuance of the solicitation documents. The technical evaluation criteria need to be put in the SSP and cannot later be changed. A Public Bid Opening is required. An Invitation to Bid (ITB) is used for the procurement of goods where the specifications are clear and concise. Procurement evaluates the bids and award the contract is granted awarded to “the qualified bidder whose bid substantially conforms to the requirements set forth in the Solicitation Documents and is evaluated to be the one with the lowest cost to the United Nations” (, UN Financial Rules and Regulations 105.15 (a)) A Request for Proposal (RFP) is used for the procurement of goods, services and works when the specifications are functional that cannot be quantitatively or qualitatively expressed in sufficient detail to allow use of an ITB at the time the solicitation documents are issued. An RFP shall also be used in the case of outsourcing non-core activities and services, or for purchase of complex goods using a functional specification when proposals from the invitees are preferred. Steps in the process include: preparation of a short-list; preparation of RFP solicitation documents; sending out the RFP; receipt of bids; bid opening, technical evaluation, and; submission for approval. A two-envelope system is used where the technical and financial proposals are submitted separately. A technical evaluation committee evaluates the technical proposals, while Procurement evaluates the financial proposals. Only the financial proposals of the technically compliant proposals are opened. Normally the technical evaluation represents 60% of the final combined score and the financial represents 40%. The award is granted to “the qualified propose whose proposal, all factors considered, is the most responsive to the requirements” (UN Financial Rules and Regulations 105.15 (b)). Please refer to the UNEP Procurement Manual for the detailed procedure. Contracting The basis of award for every purchase order or contract is indicated in the Statement of Award. The vendor needs to countersign the purchase order or the contract, and the General Conditions of Contract need to be attached to all contracts. The contract manager needs to monitor the expenditure of the contract to ensure that it does not exceed the Not-To-Exceed (NTE) amount stated in the contract. It is also the responsibility of the contract manager to ensure that the vendor performs in accordance with the contract. The Procurement Section should get involved when there are performance issues which cannot be settled by the contract manager. d. How to make advance payments If the project has component(s) implemented by a partner, payments are made to the partner in accordance with the relevant legal instruments. Cash advance refers to an advanced payment made electronically for activities to be carried out by partner. To process a cash advance, the 110 partner must prepare “cash advance statement” with the information on opening balance, date and amount of previous cash advances, total cash advances to date, cumulative expenditures incurred, and cash requirements forecast. How interest income earned by executing agencies is treated will be determined in the project document. To facilitate a payment to partner, the following steps apply: Except for the first installment which is bound to the signature of the contract, all subsequent installments are based on the receipt and acceptance of a financial report and forecast submitted by the Partner. To request payment or cash advance, partner organization prepares a cash advance statement and submits it to the Project Manager as the basis of the request. Cash advances and reporting should be recorded in USD even if the payment is made in another currency. No disbursement of budget should exceed the approved budget of the project in USD; Project Manager review the cash advance statement in line with the performance and obligations of the partner. If the Project Manager concludes that the cash advance statement is acceptable, (s)he authorizes the payment and sends a request to the responsible FMO to process the next cash advance or payment; FMO reviews the cash advance statement against project expenditures to date, expenditure forecast, and liquidation of previous advances (disbursement of cash advance is subject to liquidation of at least of 70 percent of the previous cash advances); If the cash advance statement is acceptable, the FMO requests UNON to process the payment or cash advance; Accounts Service Unit (ASU) of UNON approves the FMO’s request, instructs bank transfer, and records payment in the IMIS against matching third-party ID and project ID. If the project is executed by UNEP, Project Manager may need to pay for expense (such as consultants, meetings, etc.) directly from UNEP’s account. This is called direct payment in UNEP’s financial management, and Project Managers should ask for guidance from responsible FMO to process direct payment. Small-scale funding agreements (SSFAs) e. The FMO reviews the total global receivables outstanding from the partner (executing/implementing agency/organization) to determine if the partner has other overdue accounts not reported to UNEP. The FMO may consult the relevant Divisional FMOs regarding the identified unexpended receivables to determine if the partner is problematic in the submission of periodical financial reports; SSFAs with a contractual period exceeding 12 calendar months should be disbursed as cash advances, as opposed to outright expenditures of each installment payment against obligation. The value of the initial/first payment to the partner should not exceed 50% unless the SSFA relates to the organization of a workshop, training, seminar or meeting where the initial payment should not exceed 75%. The balance or final payment of the SSFA in this case should only be payable upon submission of the deliverables stated in the SSFA (final technical report, final financial report (and final audit report – for all PCAs). How to monitor financial performance Based on the planned budget and the installment schedule of secured funding, Project Manager can measure and monitor financial performance of the project. Figure 16 below shows conceptual illustration of how to use the planned budget as baseline, and measure the actual expenditure against it. While budgets should be as accurate as possible, it should be recognized that a budget 111 is essentially a plan and that variances will occur during implementation. Depending on the project’s progress, actual expenditure can be either higher or lower than planned at given time. It is the responsibility of Project Manager to analyze the gap between the actual expenditure and planned budget on regular basis, and review the financial analysis against programmatic performance of the project (i.e. output delivery, attainment to milestone, etc.) Based on this review and analysis, Project Manager should direct the project to be delivered within the threshold of total budget. For example, if the financial data shows over-expenditure of budget when output is not delivered on schedule, the Project Manager needs to carefully review the relevant factors and take corrective action. Figure 16: Project expenditure and financial performance Cumulative Value Total Approved Budget Funding installment Funding installment Planned budget Variance of actual expenditure against planned budget Actual Expenditure Time Managing and recording relevant expenditure information is critical for monitoring financial performance, especially when the project involves implementation by partners. The expenditure report is the main tool to monitor the project expenditures. It should be reviewed in tandem with progress reports. The frequency of requirements for expenditure reports should be defined in planning stage in consultation with FMOs. The minimum requirement is the submission of expenditure reports every six months, one of which should be issued 31 January of each year (as cut off for previous year reporting). Quarterly expenditure reports can be requested if necessary. FMOs also initiate regular budget revisions when there is a need to reconcile project expenditure. FMOs are responsible for initiating budget revisions when appropriate, but at least once a year. All expenditure reports should be certified by an authorized official from the partner institution attesting the accuracy of expenditures reported, that resources have been used in accordance with 112 budget provisions and the implementation agreement’s terms and conditions, and that all expenditures are supported by relevant documents. The partners should also maintain record of all expenditures supported by receipt and/or a document that includes the amount, description of the cost, the date of payment, and the name and address of the person or vendor receiving the money. UNEP will only accept expenditures that are in line with the approved budget. In general, a 10% variation in actual expenditure on budget lines by implementing partners can be considered acceptable, provided the expenditure does not exceed the overall allocation to the implementing partner. Variations in budget lines exceeding 10% should be reflected in an amendment to the relevant legal instrument. Detailed tasks and responsibilities in monitoring expenditure by partners with the expenditure reports are distributed as follows: Partner organization prepares and submits expenditure reports to the Project Manager using UNEP template; Project Manager reviews expenditures for programmatic consistency with planned activities, and checks the consistency between the plan, the deliveries and how it translates into financial terms. Once the Project Manager is confident that the report reflects the truthful picture of the reality of the project and it is in line with the obligations of the partner, (s)he issues a written authorization to FMO who records expenditures in IMIS; If the expenditure report is considered acceptable, FMO provides UNON with financial information and expenditure reports, and request approval by UNON through IMIS; UNON ASU liquidates the OBMO to record expenditures and offset any outstanding cash advance balance against third-party ID and project ID. In the review of expenditures, the Project Manager and FMOs should make sure that the cost is in accordance with the approved budget and that it incurred for an approved activity as per annual work plan. Expenditures should not exceed the approved budget and should be within a reasonable cost, which means: The cost is ordinary, in that it is required in the normal course of project activities (e.g., office supplies) or it is necessary for a project activity (e.g., special software or bus rental); The cost is processed with sound business practices; The cost is free of either a real or perceived conflict of interest with respect to any project team member or partner organizations; The cost does not present a significant deviation from the UNEP’s established practices or procedures; and The cost is in compliance with local legal and regulatory requirements. PIMS provides automated data from IMIS in finance section. Project managers can thus use the system to access up-to-date data on project’s financial performance and variance of project expenditure against planned budget. For more details on how to access the data and generate reports, see PIMS tutorial. A summary of UNEP’s reporting requirement is available in Chapter 5, Section E: Monitoring and Reporting. 113 f. Financial Management of Equipment In the management and inventory control of property, UN divides equipment into two types: NonExpendable Equipment (NEE) and Expendable Equipment. Detailed definitions of NonExpendable and Expendable Equipment are available in Administrative instruction on Property management and inventory control at UN Headquarters [ST/AI /2003/5]. NEE: Property or equipment valued at USD 1,500 or more per unit at the time of purchase and having a shelf life of one year or longer (e.g. generators, kitchen equipment, major equipment and vehicles); Special items, which are property items considered to be of an attractive nature and easily removable from the premises because of their size, costing USD 500 or more per unit at the time of purchase and with a serviceable life of three years or more (e.g. computers, cameras, televisions, facsimile machines and tape recorders); Group inventory items (e.g. furniture and modular workstations) with a serviceable life of five years or more, irrespective of value.31 In order for assets to be recorded as assets in the UN accounting records they must be controlled by the Organization. This is particularly relevant to project assets. Professional judgment should be exercised to determine if the entity has control over an asset. The following checklist assists in determining the existence of control: The act of purchasing the asset was carried out (or resulted from instructions given) by the UN; Legal title is in the name of the UN; The asset is physically located on premises or locations used by the UN; The asset is physically used by staff employed by the UN or staff working under the UN instructions; The UN can decide on alternative uses for the asset; The UN can decide to sell or dispose of the asset; The UN can decide to replace an asset, if it had to be removed or destroyed; A UN representative regularly inspects the asset to determine its current condition; The asset is used in achieving the objectives of the UN; The asset will be retained by the UN at the end of the project. Expendable equipment: 31 With the introduction of IPSAS in 2014 the following criteria/rules will be in place: a) Total cost consists of the asset purchase price, generally the invoice price (less discounts), import duties and nonrefundable purchase taxes, and any directly attributable costs (such as the cost of site preparation, initial delivery and handling costs or installation costs) of bringing the asset to working condition for its intended use. Total cost does not include any refundable taxes or other similar refundable costs. b) Where an asset is acquired at no cost (gifted, contributed or donated) or for a nominal cost, then the fair value of the asset as at the date of acquisition is used. In addition to the above, all of the following conditions must be met to capitalize a UN asset: i) The asset has a useful life of more than one year; ii) the asset meets the minimum established cost threshold of USD 5,000 or more per unit for all reporting entities other than Volumes I & II. For example, purchasing ten chairs at a cost of $500 each will not qualify. Control over assets arises when an entity can: use or otherwise benefit from the asset in pursuit of its objectives, and exclude or otherwise regulate the access of others to that benefit 114 Equipment valued at USD 1,500 or less per unit at the time of purchase (e.g. toner cartridges and consumables). Depending on the type of equipment, Project Manager should follow different procedures for procurement, management, and/or disposal of the equipment. Issues and procedures may vary depending on whether the project is internally executed or externally executed. Management of NEE Project Managers should obtain guidance from FMO on whether UNEP or its partners are responsible for the procurement of NEE, and they should ensure that an explicit provision on procurement is included in the legal instrument and project document. For more details on procurements, see Section C of this chapter on how to process procurements. All NEE with a unit value of USD 1,500 or more should be listed in the Inventory of NEE. The inventory is an ongoing register for recording data on newly purchased Non-Expendable Equipment, and also serves as a permanent record of all NEE purchased with project budget. The inventory may also include a list of “items of attraction”, which means the items with purchase value in excess of USD 100 that Project Manager or partner wants to keep track of (e.g., desks, office chairs, file cabinets, printers, etc). For projects implemented by UNEP: The Procurement Section of UNON is responsible for procurement of NEE using project funds. These items are considered property of UNEP. The inventory focal point of the managing Division is responsible for maintaining the Inventory of NEE. For projects implemented by partners: The partners can procure goods and services according to their own procurement policies and procedures. The partner is accountable to maintain the Inventory of NEE purchased against the UNEP projects. At the end of a project, the ownership of NEE should either be transferred to a partner or recipient, or disposed. Disposal of NEE includes the repair, transfer, destruction, re-use of parts, discard, sale or trade-in of NEE. For projects implemented by UNEP: Proposals for the disposal of NEE purchased with project funds should be reviewed by the Local Property Survey Board (LPSB) in accordance with its terms of reference; The minutes of the LPSB should be appended to the final Inventory of NEE during project closure. If the recommendation of the LPSB is to transfer the NEE to an external partner, the duly signed letter of agreement or transfer should also be attached; In case of transfer from the project to a follow-up project, the case does not have to be presented to the LPSB. However, the final Inventory of NEE will still be required for the closing revision, and the follow-up project should be revised to include the list of NEE that has been transferred. 115 For projects implemented by partners: In the case of disposal of NEE, transferring ownership of the NEE should be reviewed at the end of the project. A letter of agreement or transfer signed by the Chief of OfO and the representative of the partner should acknowledge the formal transfer of the equipment to the executing agency, with the final Inventory of NEE attached. Management of Expendable Equipment Procurement of expendable equipment can be undertaken only during project implementation (not before) and should be carried out in accordance with the approved budget. Procurement needs to be cleared by OfO, if the item is not specifically listed in the approved budget and the item costs more than USD 1,500. For more details on procurement, see Section C of this chapter. 116 10. Evaluation Evaluation is an integral part of the programme and project management, which enables UNEP to improve programme management and performance, and provides substantive accountability to UNEP’s Governing Council, donors and the general public. The main benefits of conducting evaluations are to: Enable senior management to demonstrate and measure performance; Identify where improvements can be made to design or delivery methods; Identify good practices and lessons for the future; Provide feedback for adaptive management and positive learning; Assess how UNEP’s activities have impacted environmental policy-making and management at the national, regional and global levels; and Provide a means, through disclosure, for transparency in the way the organization implements its programme activities and uses its resources. Evaluations within the UN system are designed “to determine as systematically and objectively as possible the relevance, efficiency, effectiveness and impact of the organization’s activities in relation to their objectives32”. They provide the basis for assessing the relevance, sustainability, quality and usefulness of outcomes of programme and project activities undertaken by the organization. Evaluations in the UN system are guided by a number of principles and standards outlined in the Norms and Standards for Evaluation in the UN System. For more information see: Secretary General’s bulletin on Programme Planning, the Programme Aspects of the Budget, the Monitoring of Implementation and the Methods of Evaluation (ST/SGB/2000/8) GEF projects are subject to the GEF M&E Policy and an Agency’s own policies and procedures. a. UNEP’s Approach to Evaluation UNEP conducts evaluations of programmes and projects implemented by UNEP and financed by the Environment Fund (EF), related extra-budgetary funding, and the GEF. UNEP does not conduct evaluations of the MEAs Secretariats. The evaluations enable UNEP’s senior management and Member States to systematically review project and programme performance and implement changes to increase effectiveness. In addition to evaluating results and impacts emanating from projects and programmes, evaluations also examine the validity of programme orientation, and determine whether there is need to change their direction. Within UNEP, the Evaluation Office is responsible for conducting evaluations of the Subprogrammes and projects, as well as other thematic evaluations and management studies. 32 ST/SGB/2000/8, “Regulations and Rules Governing Programme Planning, the Programme Aspects of the Budget, the Monitoring of Implementation and the Methods of Evaluation 117 UNEP’s Evaluations focus on the planned and actual achievements towards EAs defined in the PoW. Project-level evaluations inform EA evaluations, which in turn inform performance evaluations of the Subprogrammes, and finally overall evaluation of the MTS. In addition, evaluations undertaken jointly with QAS may asses the quality of UNEP project management and supervision. Evaluation reports are “evidence-based” and all findings and recommendations should be supported by verifiable sources of information. As stated in the UNEP Evaluation Policy, the Evaluation Office works independently of UNEP’s operational Divisions and reports directly to the Executive Director, an arrangement that ensures “organizational independence.” The Evaluation Office ensures that UN system and international evaluation standards are maintained, and - where appropriate - conducts joint evaluations together with UNEP partners and donors. The UNEP Evaluation Policy states that the Evaluation Office shall be free to conduct evaluations and prepare clear, accurate, objective, uncompromising and uncensored reports without undue interference from any part of the organization. An evaluation plan and adequate evaluation budget are mandatory elements of UNEP projects. For more details, please see Chapter 9: Financial Management, Section B: How to develop Project Budget. b. Types of Evaluation in UNEP Project Level Project level Mid Term Evaluations: Mid-Term Evaluations are undertaken approximately halfway through project implementation and analyze whether a project is on track, what problems and challenges the project is encountering, and which corrective actions are required. Mid-Term Evaluations are usually conducted by the Evaluation Office only when a project is: 1) of key strategic importance to UNEP; and 2) the project is “at risk.” (See Chapter 8, Section D for Project-at-Risk System) Project Mid-Term Evaluations should ideally be undertaken before the mid-point of project implementation. For projects that will not undergo Mid-Term Evaluations, the Project Manager is encouraged to conduct a mid-term review. The products of a mid-term evaluation are: a mid-term evaluation report, and an implementation plan for evaluation recommendations. The agreed evaluation implementation plan specifies whether a recommendation has been accepted/partially accepted/not accepted, how the recommendation will be implemented, who is responsible for its implementation, the date by which the implementation of the recommendation is expected to be completed, and actions already taken. The Evaluation Office subsequently monitors compliance regarding implementation of recommendations. Levels of compliance are reported, by Division, to the Executive Director. Project level Terminal evaluations: Terminal Evaluations are undertaken by independent evaluators contracted by the Evaluation Office to review a project, ideally within six months after its completion. Terminal evaluations assess overall project performance and determine the actual and potential results, their sustainability, and the operational efficiency of implementation. Terminal evaluations also identify lessons of operational relevance for future project design and implementation. The evaluation reports are publically disclosed on the UNEP website. 118 Programme Level EA Evaluations: EA Evaluations determine and verify UNEP’s performance in achieving higherlevel results defined in a specific EA. They aim to measure the change that can be attributed to UNEP’s activities. EA Evaluations utilize monitoring data from Subprogramme Coordinators and QAS. Findings from EA Evaluations inform the design of subsequent Programmes of Work. Subprogramme Evaluations: Every Subprogramme undergoes an evaluation in each MTS (every four years). Subprogramme Evaluations examine results achieved, as well as the sustainability, efficiency and efficacy of the Subprogramme’s activities. Because the thematic Subprogrammes transect UNEP’s Divisional structure, coordination and cooperation among Divisions and Regional Offices, as well as the complementarily of GEF financing, is also examined and evaluated, along with partnership arrangements with other UN bodies, intergovernmental organizations, international, regional and national non-governmental organizations, scientific and environmental centers, private sector organizations, networks and groups. Impact Evaluations: Impact evaluations are a particularly useful assessment of the overall performance of a project or programme which measures the impacts and sustainability against stated objectives. Impact evaluations determine the entire range of effects including on people or environments beyond the scope of the project or programme. Impact evaluations are often expensive and are conducted on a selective basis typically two or more years after project’s (or portfolio of projects’) completion, to evaluate UNEP’s success in sustaining benefits in line with UNEP’s strategic objectives. Management Studies: Management studies examine cross-cutting issues of special relevance to the entire organization. They focus on management processes result in recommendations for improving management practices, processes and tools. Specific areas for study may include operational policies, strategies, collaborative and partnership arrangements, funding modalities and networks. Quality of project management and supervision reviews: Quality of Project Management and Supervision Reviews are carried out jointly by the Evaluation Office and QAS to examine and evaluate the quality of project management and supervision throughout UNEP. The reviews assess: the adequacy of project management and supervision plans, inputs and processes; outcome monitoring (results-based project management); the quality and validity of project reporting, risk assessments and progress reviews; the quality of documentation of project management and supervision activities; and the adequacy of financial, administrative and other fiduciary aspects of project implementation and supervision. Meta-Evaluations and special studies: At the end of each biennium, the Evaluation Office prepares a Biennial Evaluation Report which evaluates overall organization performance through the syntheses of results from all types of evaluations conducted over the biennia. The report presents recommendations and lessons for consideration by UNEP Senior Management. The report is disseminated to the GC, CPR, Member States and UNEP staff. 119 c. Processes of Evaluation Detailed tasks in conducting an evaluation are described below as a ten-step process. The roles and responsibilities of different members of the project team and the Evaluation Office are summarized in Table 13 at the end of this section. Step 1: Determine the focus of the evaluation - The Evaluation Office decides, with input from the Project Manager, details such as: the objective and scope of the evaluation; the evaluation questions and areas of investigations; the evaluation approach and methodology (e.g. desk study, interviews with key stakeholders, field visits, full participatory evaluation involving meetings and interviews with direct beneficiaries at a number of different sites); the evaluation’s team and its qualifications; timing of the evaluation; budget, and; and target audience. Step 2: Draft the Terms of Reference - The Evaluation Office drafts the Terms of Reference (ToR) for the evaluation, in consultation with the Project Manager and others, as appropriate. The ToR sets out expectations and requirements and serves as the basis for any contracts with evaluators. Evaluation criteria and standards are clearly documented in the ToR. In addition, the ToR should be limited to what is realistic and feasible within the given time frame and budget in order to avoid overly ambitious evaluations. While evaluations can point to problems and make certain recommendations, it is unrealistic to expect that they can solve all issues related to a project. Click to view an example of ToR for a terminal review of a UNEP project. Step 3: Draft the budget - Project budgets normally include a provision for a Terminal Evaluation. Projects with a planned duration of more than three years should also have a budget for a Mid-Term Evaluation or review. The initial evaluation cost estimate is calculated and compared with available financial resources. Where available funds fall short, the Project Manager should attempt to secure additional financial resources, or the scope of the evaluation/field visits conducted/consultancy fees offered may be reconsidered to bring the cost estimates in line with available resources. If sufficient resources for the evaluation are not available, the Evaluation Office will not undertake the evaluation. Such decisions will be communicated to UNEP’s Senior Management. The following elements are considered when developing an evaluation budget: Consultant evaluators’ fees: An estimate is made based of the number of consulting days required and the daily consultant evaluator’s remuneration rate. In case of certain complex evaluations, or in joint evaluations, the services of one consultant/evaluator may not be adequate, and a team of two/three consultants will need to be hired. See Chapter 9: Financial Management for more details on budgeting for consultants. Travel: Mode of transport and DSA should be factored in. For an initial budget estimate, the point of origin for travel by the consultant evaluator(s) is assumed and airfares estimated. Communication and dissemination: Editing, translation (where stakeholders and partners do not speak / read English), printing, postage, telephone calls, interpreters for field missions and translation services are included in the estimate. 120 Step 4: Select the evaluation team - When the ToR and budget are agreed, at least three suitable consultant evaluators are identified. The Evaluation Office screens and makes the final decision on the consultant evaluator(s). However, it is general practice for the evaluation staff to ask the Project Manager and other UNEP colleagues and institutions for suggestions regarding possible candidates. When selecting evaluation consultants, it is important to ensure that: They have not been involved with the project/programme design or its implementation; They have the technical and language skills required; They have the necessary country/regional and evaluation experience. In the case of complex evaluations for which more than one evaluator is needed, a team leader will normally be recruited to assume primary responsibility for the evaluation. The duties of the team leader require a combination of technical skills in the area of evaluation and good interpersonal, management, writing and presentational skills. The team leader’s responsibilities include: Work closely with the Evaluation Office and the Project Manager throughout the process to ensure expectations are met; Manage the team to ensure that all conditions of the ToRs are fulfilled; Oversee preparation of the evaluation work plan; Oversee data collection, in compliance with the UN Evaluation Group (UNEG) norms and standards; Facilitate agreement among the team on findings, conclusions and recommendations; Prepare and present the draft report, and facilitate feedback; Produce the final report, amended in response to comments received. Step 5: Prepare final detailed evaluation cost estimate - Once the evaluation team has been selected, the agreed consulting fee rates and travel costs are finalized, DSA costs calculated, and the final evaluation cost estimate prepared by the Evaluation Office. The final cost estimate is reflected in the terms and conditions specified in the Special Services Agreement (SSA) prepared by UNON, which forms the contract between UNEP and the evaluation consultant. Step 6: Organize logistics - The Evaluation Office facilitates logistics, in collaboration with the Project Manager and any other relevant organizations. It is important to bear in mind that organizing logistics, including UNON’s preparation of contracts for consultant evaluator(s), can be very time consuming. Normally, two to three months are required to prepare the evaluation from the development of ToRs to the inception of the evaluation. The Project Manager and the FMO are responsible for the following: Inform project staff and key stakeholders / partners about the evaluation scope, focus and schedule; Assemble key documents for the consultants to review, e.g. progress reports, financial reports and technical outputs, etc.; Provide evaluators with contact details for key project staff and stakeholders; 121 Coordinate with the implementing partner(s) to make logistical arrangements for any evaluation field visits, e.g. local transportation to access any field sites, and/or set up meetings with key project stakeholders; Prepare any letters of invitation that may be required for the consultant evaluator(s) to obtain a visa/required travel authorization. Step 7: Brief the evaluation team - The Evaluation Office holds an initial briefing session with the evaluator(s) and the Project Manager. At the briefing session, the Evaluation Office clarifies expectations and points out areas requiring special attention. A list of contacts for key issues is presented to the evaluation team. Throughout the evaluation fieldwork and write-up period, the Evaluation Office and Project Manager remain in contact with the evaluators at regular intervals. Table 12: Contact points for communication on key issues during an evaluation Issues Contact points Project finances Project staff, FMO Technical /substantive Project staff, Project Manager Logistical issues Project staff, Project Manager, UNEP Evaluation Office Evaluation ToRs, issues and methods UNEP Evaluation Office Preparation / submission of evaluation reports UNEP Evaluation Office Contractual issues UNEP Evaluation Office Step 8: Receive and review the draft report - Before starting the actual implementation of the evaluation process, the consultant will submit to the Evaluation Office an Inception Report for review. The inception report lays the foundations for the main evaluation. Its purpose is to develop an evaluation framework that includes: i) a review of the quality of project design to help identify how project design impacts on project implementation and performance; ii) an analysis of the project’s theory of change, creating a baseline which can be used to assess the actual project outcomes and impacts (expected and unexpected) during field visits and interviews, and; iii) a detailed plan for the evaluation process. For larger and more complex evaluations, the consultant evaluator(s) may also prepare interim reports, for example at the end of each phase or activity. Interim reports may be presented at stakeholder workshops to feedback and verification of findings. Interim reporting is particularly useful to prepare stakeholders for potentially unwelcome findings, and for encouraging interest in the final reports and acceptance of the recommendations. Consultant evaluator(s) report primarily to the Evaluation Office, and draft reports are sent to the Evaluation Office for initial review. The Evaluation Office assesses the usefulness of the lessons learned and recommendations presented, and it provides feedback on the methodology, soundness of findings and ratings, and the overall logic of the report. For Terminal and Mid-term Evaluations, the Evaluation Office rates the reports against specific criteria to ensure that the conditions of the ToR have been fulfilled, and that the performance ratings are substantiated. If the draft report meets the Evaluation Office’s minimum quality standards, the draft report is then shared with the Project Manager and key project stakeholders, 122 who provide comments focussing, in particular, on any factual errors and (if applicable) verify that implementation of the recommendations would be feasible. The Evaluation Office collates all comments on the draft report and provides consolidated feedback to guide the consultant evaluator(s), and distributes consolidated comments to stakeholders. Where feasible, the Evaluation Office meets in person with the evaluation team and key stakeholders to discuss the draft report and its findings. Step 9: Receive and Approve the Final Report - Once the Evaluation Office is satisfied that the report conforms to the ToR and all comments have been adequately considered, the final payment is authorised. A good evaluation report communicates findings, lessons learned and recommendations clearly, accurately and appropriately, and while being an objective presentation of the project, ensures that the concerns and comments of the involved parties are correctly reflected. The report elements presented below are standard and applicable to all evaluation reports: 1. Executive summary: The executive summary should be short, easily digestible, and provide a summary of the report, including the purpose, context and scope of the evaluation, methodology used, main findings, lessons and recommendations. 2. Introduction or background: Provides a brief overview of the evaluated project for example, project logic and assumptions, status of activities, objective of the evaluation, and questions to be addressed. 3. Methodology: This section describes the methods used to collect and analyze information and data, (use of questionnaires, official data, interviews, focus groups and workshops) and discusses the limitations and problems encountered during the evaluation such as key people not available for interview or documents not available. 4. Findings: This section describes what actual results were achieved in relation to those intended, positive and negative impacts (intentional and unintentional), and problems and issues encountered by the project/programme. Root causes of successes and failures should be documented, and all findings should be supported by evidence. 5. Conclusions: This section provides as assessment and ratings based on the analyses, using evaluation criteria and standards defined in the terms of reference. The conclusion provides answers to questions about whether the project is considered successful or not. 6. Lessons: This section presents general conclusions that have the potential for wider application and use in other projects/programmes. The context in which the lessons may be applied should be clearly specified, and lessons should always state or imply some prescriptive action. 7. Recommendations: This section presents actionable proposals for stakeholders to rectify poor existing situations. Each recommendation should be preceded by a clear description of the issue(s) or problem(s) to be addressed. Recommendations should be feasible to implement within the timeframe and resources available, commensurate with the available capacities of project team and partners; specify who should to what and when; and include a measurable performance target. A trade-off analysis should be included when implementation would require utilizing significant resources that would otherwise be used for competing purposes. 8. Annexes: Annexes may include ToR, lists of interviewees, documents reviewed etc. Dissident views or management responses to the evaluation findings may later be appended in an annex. Step 10: Dissemination and Disclosure of the Final Report - To ensure transparency, full disclosure will be a key guiding principle in UNEP evaluations. To that end, all evaluation 123 reports prepared by the Evaluation Office are made public on the UNEP Website. Immediately after completion of the evaluation process, key evaluation stakeholders are provided with copies of the Evaluation Reports and ‘Evaluation Commentaries,’ usually via electronic means. Table 13: Summary of Roles and Responsibilities in Evaluation Focal point Responsibilities Evaluation Office Determines the focus of the evaluation – consults with Project Manager and Implementation Partners Responsible for development of Terms of Reference, consults with Project Manager and Implementation Partners Delivers Terms of Reference (ToR) Prepares a Cost Estimate for the evaluation Screens potential evaluators from suggestions received and from the Evaluation Consultant Roster. Makes the final decision on evaluation consultant(s) Contracts the evaluation consultant(s) Facilitates the completion of the evaluation with the Project Manager, including but varying by evaluation type: Appropriate logistics, Evaluation team initial briefing, and Regular contact with evaluator on progress status Reviews draft report for quality and accuracy Disseminates draft report to key stakeholders for comment and, where possible, convenes a meeting to discuss the draft evaluation report with key stakeholders Receives and reviews all comments from key stakeholders on the draft evaluation report Provides consolidated feedback from key stakeholders on the draft report to the consultant evaluator(s) Reviews final report for quality and accuracy Authorizes final payment once satisfied with Final Report. Determines final ratings for the project Prepares draft implementation plan for recommendations (if applicable) Disseminates the final report Discloses the report on the Evaluation Office web site Tracks implementation of evaluation recommendations Project Manager Thinks about the focus of the evaluation in close collaboration with Evaluation Office and the Implementing Partner Provides input to Evaluation Office on the draft Evaluation Terms of Reference Verifies the budget allocation is correct and available for the type of evaluation required – liaises with FMO on this matter Provides input to Evaluation Office for their development of an initial cost estimate Suggests a possible consultant evaluators for the Evaluation Office selection Provides comments on the draft evaluation report focusing on errors of fact or conclusions / findings based on such errors Assists Evaluation Office in identifying the recipients list for the final report Completes the draft implementation plan if recommendations are made for the project to implement – within two weeks of receipt Provides progress updates on compliance with the evaluation implementation plan. (Three six-monthly follow-up reviews) Implementati on Partner Ensures that information is made available upon request to: Project Manager, Contracted evaluation consultant(s), and Evaluation Office via Project Manager Assists with evaluation logistics if receiving an evaluation mission Comments on the draft Evaluation ToRs to ensure the focus Comments on the Draft Evaluation report and sends comments to the Evaluation Office 124 Focal point Responsibilities FMO Evaluation Consultant d. Checks compliance with corporate standards Clears that budget is available for the appropriate evaluation Clears that budget is available for selected consultant(s) Checks the financial information presented in the evaluation report at draft and final stages Carries out the evaluation in accordance with the ToR Liaises with Evaluation Office and Project Manager on progress Delivers draft Report in accordance with contract and ToRs Revises draft evaluation report after consideration of consolidated comments from all parties (provided by Evaluation Office) Delivers Final Report in accordance with contract and ToRs. Management Responses and Recommendations Following the completion of a formal project or programme evaluation, management considers the recommendations contained therein, and the responsible officer (e.g., a Project Manager) prepares a management response and an implementation plan for accepted recommendations. Findings from EA and Subprogramme evaluations are discussed and approved by Senior Management, who is also responsible for the management response. Any discordant views are appended to the evaluation report and fully disclosed to the public. For each recommendation, an implementation plan should be specified: whether it has been accepted; how the recommendation will be implemented; who is responsible for its implementation; the expected completion date; and what actions have already been taken (if any). Where a recommendation is rejected, an explanation must be provided as to why the recommendation cannot be implemented, and where appropriate an alternative course of action should be specified. The Evaluation Office uses a compliance procedure to track the progress of recommendation implementation compliance. Project Managers are required to report the status of recommendation implementation to the Evaluation Office at six month intervals (September and March). The Evaluation Office makes regular compliance status reports to the Executive Director and these are routinely discussed with Division Directors. The Evaluation Office uses the following classifications when assessing the progress of recommendation implementation compliance: Fully implemented = Compliant Partially implemented = Partially Compliant Not implemented = Not Compliant No further action required Recommendations are kept ‘open’ until they are deemed to be ‘Compliant’ or until three assessment points have been completed (whichever the sooner) at which point they are formally ‘closed.’ 125 Table 14: Types of compliance status in implementation of evaluation recommendations Recommendation Compliance Status Open & Not Compliant Open & Partially Compliant Closed & Compliant Closed & Partially Compliant Closed & Not Compliant Closed & No further action required Description The project has made no substantive progress in implementing the recommendation and less than three ‘compliance reviews’ for the recommendation have been completed by the Evaluation Office The project has made some progress in implementing the recommendation but it is not yet complete. Less than three ‘compliance reviews’ for the recommendation have been completed by the Evaluation Office The project have fully implemented the actions required by the recommendation. The project has made some progress in implementing the recommendation but it is not yet complete. Three ‘compliance reviews’ for the recommendation have been completed by the Evaluation Office. The project has made no substantive progress in implementing the recommendation and three ‘compliance reviews’ for the recommendation have been completed by the Evaluation Office The Evaluation Office has closed the recommendation. The need to implement the recommendation has been overtaken by events or changed project circumstances. It is important to note that when a recommendation reaches the third assessment point (i.e. after a maximum of 18 months) it will be automatically “closed”, and the recommendation implementation status (‘compliant’, ‘partially compliant’ or ‘not compliant’) will be permanently recorded with no further changes to the status allowed. If the Evaluation Office does not receive an updated implementation plan prior to the compliance assessment process, any remaining recommendations are ‘closed’ with the level of compliance unchanged from the previous assessment point. 126 11. Project Completion and Closure All projects have a definite end and must be formally closed. It is the responsibility of Project Manager to complete the project according to the schedule. A project may be brought to premature closure (See Chapter 5, Section G: Project Revisions) if the project is no longer viable, or the business case of the project is no longer valid. Regardless of the reason for closure, the Project Manager is accountable for finalizing all administrative procedures for project completion and closure, and should work with the FMO to complete the necessary project revisions and to ensure compliance with the Financial Regulations and Rules of the United Nations. During this stage of project cycle, the Project Manager needs to first confirm completion of the project activities and outputs; to provide the FMO with the necessary information and documentation to finalize the process for administrative completion of the project using Project Completion Revision; and then, as a final step, finalize the financial and administrative closure of the project with a Project Closing Revision. It should be noted that project completion is a prerequisite for project closure. FMOs are responsible for preparing Project Completion Revision and Project Closing Revision, while Project Managers are accountable for submission of necessary documentation and recovery of any unspent cash advances. Figure 14 is an illustration of the overall process. Figure 17: Process of Project Completion and Closure STEP 1 (by project manager) STEP 2 (by FMO with info from PM) STEP 3 (by FMO) Confirm completion of the project Finalize administrative completion of the project Finalize administrative closure of the project Project COMPLETION Revision a. Project CLOSING Revision Confirming Completion of the Project A project is considered completed when all planned activities and outputs listed in the project document have been delivered. If the project is implemented by partners, the partners should notify the Project Manager when they complete the delivery of planned activities and/or outputs. In case the project has a steering committee, the Project Manager should obtain confirmation of project completion from the project steering committee. Once the Project Manager receives notification from the partners, (s)he needs to request the partners to submit supporting documents also to the responsible FMO, and to repay any unspent funds. The documents should be prepared in accordance with the terms of conditions of the 127 relevant legal instrument and project document. Unless otherwise specified in the legal instrument, the partner needs to submit: Final Report, which summarizes the lessons learned, accomplishments, costs, deliverables, and activities of the project. Final Expenditure Statement; Final Inventory of NEE, if applicable; Final Audited Statement of Accounts, if applicable. Whenever required by the legal instrument (normally if the project budget for the partner exceeds USD 200,000), partners must submit Final Audited Statement of Accounts for certification by a recognized firm of public accountants. If the partner is a government agency, a final statement of accounts can be certified by an authorized signatory on its behalf, and the audit report from the government auditor may be accepted. For projects in which UNDP is providing “Administrative Services and Reimbursable Support Service Arrangements,” it is recommended that a financial statement of cumulative expenditures be obtained from the UNDP Country Office concerned in order to facilitate the process of reconciling the receivable account with the Inter-Office Voucher (IOV) received from UNDP headquarters. The Project Manager should also liaise with the Evaluation Office to initiate process for the Terminal Evaluation of the project. The Terminal Evaluation report is one of the requirements in project closure. For detailed guidance on evaluation and relevant process, see Chapter 10: Evaluation. b. Administrative Completion Revision of the Project Note: The completion revision described below is required when all the project milestones have been achieved, and activities and outputs delivered, but the Terminal Evaluation has not been completed or any of the reports required for project closure have not yet been received. If everything required to close the project is available, the project can be financially and administratively closed by a ‘Project Closing Revision’ (see Section C below) without the need for a ‘Project Completion Revision’. For administrative completion, the Project Manager should send the Final Report to the responsible FMO, and request the FMO to initiate the process for Project Completion Revision, which involves approval of financial reports and substantive reports along with receipt of any unspent cash advances. If available, the Project Completion Revision should also be accompanied by: the revised budget, the Budget Variances (for GEF projects); and the Cash Statement (for GEF projects). Then: 1. The responsible Division Director or Regional Director approves the Project Completion Revision of the project and signs the Project Completion Revision Routing Slip for approval; 2. The FMO submits the Project Completion Revision along with a Project Action Sheet to Projects Reports and Databases Unit (PRDB) of OfO (Distribution Sheet is not required); 128 3. Based on the documents submitted by the FMO, OfO verifies that allotments are in line with project income and that expenditure has not exceeded allotments; 4. Chief of OfO authorizes the Project Completion Revision by signing the Project Action Sheet. The progress of the completion revision can be tracked using the Project Completion Revision Routing Slip (also called “Blue File”). Once the Project Completion Revision is finalized, the FMO should inform the Project Manager that the project is administratively completed, and upload a copy of signed the Project Action Sheet into PIMS with accompanying documents listed above. When all required documents are uploaded, PIMS will automatically update the project status as technically “completed” and show “actual completion date”. At a later date, the financial completion will be recorded in IMIS (through recording of the final expenditure or audit reconciliation). Projects that remain open beyond the completion date will automatically show in the project-at-risk system in PIMS. The Project Completion Revision should show an "expected closing date.” The actual date of completion is entered as the official completion date of the project (not the date when the Project Closing Revision is signed). Any expenditure made against the project budget after the completion date will not be paid; however, expenditures incurred or committed before the completion date, but submitted after the completion date may be paid. c. Financial and Administrative Closure of the Project Once the project is completed, a project can be closed by a Project Closing Revision {Process for financial closure of projects}. Working closely with the Project Manager, the FMO should ensure that all necessary documents are prepared for Project Closing Revision. Following the process initiated upon operational completion of the project (see Section A of this chapter), the Project Manager should obtain the Terminal Evaluation Report from the Evaluation Office for Project Closing Revision. A project cannot be closed before the Terminal Evaluation is undertaken. Various donors may have different requirements for project closure. For GEF related projects, please consult the GEF specialist within your Division. The Project Closing Revision requires following documents: Revised Budget; Schedule explaining variances between original and final budget; Cash Statement; Final Expenditure Statement from partner; Final Inventory of NEE from partner; Signed Inventory Transfer Agreement from partner; Final Audited Statement of Accounts from partner, if applicable; Copy of project deliverables (e.g., books published, report developed from a scientific study), if applicable; Final Report from the Project Manager; and Terminal Evaluation Report from the Evaluation Office. 129 The progress of the Project Closing Revision is tracked using the Project Closing Revision Routing Slip (also called “Green File”) and shall be accompanied by the following actions: 1. The FMO initiates the process for disposal of equipment purchased under the project, and prepares the Inventory Transfer Agreement to be signed by the partner; 2. The Project Manager and the FMO accept all final reports submitted by the partners, including the signed Inventory Transfer Agreement; 3. The FMO reviews all financial transactions reported by the partner, including receivables, payables and obligations; 4. Based on the review, the FMO raises a funding document in IMIS and signs the Project Closing Revision Routing Slip which certifies expenditures for the project; 5. The Budget and Financial Management Service (BFMS) within UNON ASU verifies that all expenditures are correct and there are no outstanding receivables or payables in IMIS; 6. Projects Reports and Databases Unit (PRDB) of OfO verifies that expenditures are consistent with allotments in IMIS and that all reports have been received, and updates IMIS with closure information; 7. The responsible Division Director approves the closing revision and signs the Closing Decision Sheet; 8. The Chief of OfO authorizes UNON to record the final expenditures and close the project by signing the Project Action Sheet and the Inventory Transfer Agreement. Once the closing revision is finalized, the FMO informs the Project Manager, and record the status in PIMS with the following documents: Copy of signed Project Action Sheet; Final Report; Inventory Transfer Agreement signed (see Chapter 9: Financial Management on equipment management); Final Audited Statement of Accounts from partner, if applicable; Cash statement indicating return of unspent funds; Schedule explaining variances between original and final budget; and Terminal Evaluation Report. Once all the required document are uploaded, PIMS updates the project status as “closed” and show the “date of closure” which is same as the end date in IMIS. Once the project is recorded “completed” based on the process above, PIMS will send monthly reminder to the project manager for closure. A project should be closed no more than 24 months after the date of operational completion or project termination. Once the project is closed, no additional financial transactions affecting the final status of the project accounts may be entered in IMIS. If the partner reports additional activities and/or expenditures amounting to more than the contingency un-liquidated obligation of USD 10,000 after the approval of closing revision, such activities and/or expenditures may not be paid or reimbursed. Legal documents (PCAs and SSFAs) contracted with partners to facilitate execution of a project should not have an expiry date which is the same/similar as/ too close to the project end date. A subproject or legal agreement cannot remain open when the main project has been closed. In consultation with the FMOs, Project Managers need to review contractual requirements and 130 clauses of relevant legal instruments in terms of project termination and closure, and ensure all legal instruments of the projects are closed in accordance with the project closure. In the case of GEF projects, the GEF Coordination Office submits regular reports to the GEF Trustee on the closure and cancellation of projects. The FMOs, through the Closing Revision, inform GEF-CO of any such events. [What if there is unspent balance from partner?] It is the responsibility of the Project Manager to ensure that partners have settled all outstanding financial and reporting obligations before project closure. If any unspent balance remains, the responsible Project Manager, or the FMO with the Project Manager’s consent, requests the partner to return the unspent funds, copying the Chief of OfO Contributions Unit. Alternatively, the FMO, with the Project Manager’s consent, may request the Chief of OfO Contributions Unit to send a request to the partner, in which case the FMO should provide the following information to OfO: Project title; Payee name and third party ID; Trust fund; IMIS project ID; Amount of the expected receipt; Receivable number (RCTP) ID and IMIS project number to which the receipt should be credited; Reason for the transfer (e.g. return of unspent funds advanced to the project). In the case of GEF projects, all unspent funds are returned to the GEF Trustee, through a system established in the GEF Coordination Office. Process for Refund to Donors (Project Closure)` Process for unapplied contributions reconciliation [What if a partner fails to submit reports?] If a partner fails to comply with any project closure requirements such as delivery of the Final Report and/or Final Audited Statement of Account within 60 days from the project completion date, or 180 days from a no-cost extension of the legal instrument, the Project Managers should send follow-up reminders to the partner on quarterly basis for a period of one year and keep the FMO informed. Such reminders should constitute written evidence (e.g. emails and letters) showing that all possible steps have been taken to obtain such reports (e.g. escalating the issue to supervisor or senior managers). At the end of this one-year period, the legal instrument is no longer valid and the project must be closed. In special circumstances, and subject to the approval of Division Directors, this may impede future partnership agreements with the organization which failed to submit reports. If necessary, a request for write-off can be submitted to close the project as described above. Write-off process UNEP may write-off a receivable amount when it has transferred funds to a partner and the partner is unable to account for the funds. Before requesting for a "write-off", the programme 131 manager should create an audit trail testifying of its due diligence in trying to either make the partner comply with the contract terms, or alternatively recover the cash advanced and not reported for. The audit trail should be made of, at least, a written reminder every 3 months, over a period of 18 months, of the partner's obligations, stating UNEP's expectations vis-à-vis the partner. The wording as well as the seniority of the signatory of the reminder should escalate gradually to reach at the last stage the black listing of the partner signed by the Chief of OfO. Based on this audit trail, the programme manager can request for an ad-hoc offset, in case sufficient evidence has been gathered to be convinced that the output has been delivered but not reported for. In case it instead appears that the cash advanced has been misappropriated, the audit trail will serve as supporting document to request for a write-off. The write-off will consist in the offset against a corporate reserve. The write-off is governed by the regulation 6.4, Rule 106.8 and 106.9 of the UN Financial Rules and Regulations which states that the “Secretary-General may, after full investigation, authorize the writing-off of losses of cash, stores and other assets, provided that a statement of all such amounts written off shall be submitted to the Board of Auditors with the accounts.” Where necessary, the FMO can obtain guidance from the Chief of OfO on the appropriate procedures for write-offs. [What if a closed project needs to be amended?] If an amendment needs to be made to a closed project, the Project Manager should consult the FMO and obtain permission from the Chief of OfO who is responsible for approving Closing Project Revisions. In this case, a “Revision Note to File” should be prepared as an integral part of an amended Closing Project Revision. At the discretion of the Chief of OfO, the project may be re-opened in IMIS and PIMS to reflect the approved amendment, after which the project will be closed again. 132 ANNEXES 1. Key Terms and Definitions The following definitions are those used by UNEP in developing a results-based PoW. The definitions are based on the OECD/DAC Glossary of Key Terms in Evaluation and Results-Based Management (2002). Activity Actions taken or work performed through which inputs, such as funds, technical assistance and other types of resources, are mobilized to produce specific outputs Executing Partner (GEF) In GEF-funded projects, a partner directly managing the project, executing project activities, monitoring project progress, sub-contracting, managing project staff and funds, and carrying out other project management functions Expected Accomplishments (EAs) The outcomes or results approved in the MTS and Programme of Work under each Subprogramme to which UNEP has committed. This is the level at which indicators measure success Impact Positive and negative, primary and secondary long-term effects produced by a development intervention, directly or indirectly, intended or unintended Implementing Partner (GEF) In GEF-funded projects, implementing partners (like UNEP) are tasked with project identification, preparation of project concept, appraisal, preparation of detailed project document, project approval and start-up, project supervision, and project completion and evaluation Implementing Partner (UNEP) An external entity to which UNEP delegates responsibility for the implementation of programme/projects and provide funds for this purpose based on a legal agreement concluded by the interested parties Indirect and support costs These are costs incurred by the Organization that cannot be traced unequivocally to the delivery of projects and activities to implement the Programme of Work. They include management and administration costs (both post and non-post items); costs associated with representational activities and discussions with, and intelligence gathering on areas considered of importance to, recipient governments, donors and other partners; and costs for staff funded from the Environment Fund Inputs The financial, human and material resources used for the development intervention Lead Division The Division assigned to deliver a given Subprogramme on behalf of UNEP. Lead Divisions are responsible for providing intellectual leadership in achieving programmatic coherence in the design and implementation of activities across UNEP Managing Division The Managing Division for a given project is the Division where the project manager sits. The Managing Division is responsible for delivering the project outputs and outcomes. Milestone A milestone is a scheduled event signifying the progression or completion of work towards a project output and ultimately the project outcome. Milestones are key events that provide a measure of progress and a target for the project team to aim at. Outcome The likely or achieved short-term and medium-term effects of an intervention’s outputs Output The products, capital goods and services which result from a development 133 intervention; may also include changes resulting from the intervention which are relevant to the achievement of outcomes Performance The degree to which a development intervention or a development partner operates according to specific criteria/standard/guidelines or achieves results in accordance with stated goals and plans. Performance indicator A variable that allows the verification of changes in the development intervention or shows results relative to what was planned. Performance measurement A system for assessing performance of development interventions against stated goals Performance monitoring A continuous process of collecting and analyzing data to compare how well a project, programme or policy is being implemented against expected results. PoW Outputs These are the outputs approved in the Programme of Work under each EA. They are the products and services that UNEP is to deliver to achieve the EAs. Project The planning and management tool that shows how inputs are converted into project outputs and outcomes through a specific set of activities managed by specific staff, using a specific method or design. Projects are linked to one or more specific Programme of Work outputs under a given EA Project Manager A staff member of UNEP assigned by the Division managing the project to have overall responsibility for implementing the project on behalf of UNEP Result The outcome or impact (intended or unintended, positive and/or negative) of a development intervention. Results-Based Management (RBM) A management strategy focusing on performance and achievement of outputs, outcomes and impacts. Subprogramme Coordinators The staff members assigned to each Subprogramme in support of the Lead Division Director. Subprogramme Coordinators facilitate and support Divisions and Regional Offices in the coherent design and planning for implementation of projects across the organization, leading to the delivery of the PoW outputs and ultimately contributing to the delivery of EAs for each Subprogramme. Suspension Refers to the temporary halt of project activities and financial disbursements. Written notification between The Parties should take place. Re-initiation of activities should also be communicated in writing. Task Manager (GEF) a Project Manager implementing GEF-funded projects Termination Refers to the termination of project activities before the expected completion date and before all activities take place. Written notification between The Parties is essential and should be done at least 3 months in advance on intended termination date to allow for the orderly conclusion of activities and withdrawal of personnel. Workplans (Divisional and Regional) The plans that show the full set of projects and activities, with budgets, across all Subprogrammes for which a Division or Regional Office is accountable. These workplans are a consolidation of a Division’s or Regional Office’s work based on its contribution to the portfolio of projects to deliver the results in the MTS and respective PoWs. Workplans should include the post and non-post use of resources from the Environment Fund and Extra budgetary sources. 134 2. Templates [Planning Documents] Programme Framework Template (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=476&Itemid=521 ) UNEP Project Preparation Proposal Template (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=479&Itemid=521 ) UNEP Project Document Template (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=478&Itemid=521 ) UNEP Project Document Supplement / Project Revision Template (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=480&Itemid=521 ) UNEP project budget format (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2742&Itemid=5 21) [Legal instruments] Letter of Intent (LOI) (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=466&Itemid=521 ) Exchange of Letters (EOL) (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=467&Itemid=521 ) Letter of Agreement (LOA) (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=465&Itemid=521) Memorandum of Understanding (MOU) (http://intranet.unep.org/PDF/111017_OfO_MOU%20template_FNL.doc) Project Cooperation Agreement (PCA) (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=469&Itemid=521 ) Small-Scale Funding Agreement (SSFA) (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=471&Itemid=521 ) Donor Agreement (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=459&Itemid=521 ) Amendment (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=482&Itemid=521 ) [Financial Documents] Cash Advance Statement (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=457&Itemid=521 ) 135 Expenditure Report Audit Report Final Audited Statement of Accounts Inventory of Non-Expendable Equipment Project Action Sheet Decision Sheet Blue File: Routing Slip for Project Completion Revision (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2684&Itemid=) Green File: Routing Slip for Project Closing Revision (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2685&Itemid=) Pink File: Routing slip for new projects (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2676&Itemid=5 21) 136 3. References [Roles and Mandates of UNEP] UN General Assembly resolution 2997 (XXVII) 1972 - Institutional and financial arrangements for international environmental cooperation (http://test.unep.org/PDF/RBM/Roles%20and%20mandates%20of%20UNEP/UN%20GA%20Resolution% 202997_XXVII.doc ) Bali Strategic Plan for Technology Support and Capacity-building ( http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=417&Itemid=521 ) Cartagena Package 2002 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2660&Itemid=521) Malmö Ministerial Declaration 2000 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=423&Itemid=521) Nairobi Declaration on the Role and Mandate of UNEP (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=425&Itemid=521 ) Delivering as One: Report of the Secretary-General’s High-Level Panel (http://www.un.org/events/panel/resources/pdfs/HLP-SWC-FinalReport.pdf) [Strategies and Policies] UNEP Medium Term Strategy (MTS) for 2010-2013 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=446&Itemid=521 ) UNEP policy paper “Moving Forward with Strategic Presence 2010-2013” (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=424&Itemid=521 ) UNEP External Communications Strategy 2010-2013 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=444&Itemid=521 ) UNEP Science Strategy 2011-2013 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=454&Itemid=521) [Programme Design and Implementation] Integration of GEF Operations in UNEP: Accountability, structure and functions of the restructured GEF, 2011 http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2675&Itemid= Integration of GEF Operations in UNEP: The revised project cycle of UNEP/GEF 2011 http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2818&Itemid= Operational Guidelines for Implementing the Accountability Framework for Internally Executed GEF Projects, 2012 http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2686&Itemid=521 UNEP Strategic Framework 2010-2011 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=455&Itemid=521 ) UNEP Strategic Framework 2012-2013 (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=485&Itemid=521 ) 137 UNEP Programme of Work 2010-2011: biennial programme and support budget (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=452&Itemid=521 ) UNEP Programme of Work 2012-2013: biennial programme and support budget (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=451&Itemid=521 ) UNEP Programme Accountability Framework (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=450&Itemid=521 ) UNEP Risk Analysis Table (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=481&Itemid=521 ) [Monitoring and Evaluation] GEF Monitoring and Evaluation Policy http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=2681&Itemid=521 UNEP Monitoring Policy (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=448&Itemid=521 ) UNEP Monitoring Plan (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=447&Itemid=521 ) UNEP Evaluation Policy (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=443&Itemid=521 ) [Budget and Finance] Secretary General’s bulletin on Programme Planning, the Programme Aspects of the Budget, the Monitoring of Implementation and the Methods of Evaluation (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=439&Itemid=521 ) Guidelines on Cooperation between the United Nations and the Business Sector (http://intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=421&Itemid=521 ) Administrative instruction on Property management and inventory control at UN Headquarters (http://www.unescap.org/Fmu/PMSU/ST_AI_2003_5.pdf) Quarterly Project Expenditure for (UN) Cooperating Organizations Quarterly Project Expenditure for (non-UN) Supporting Organizations Final inventory of Non Expendable Equipment Financial Regulations and Rules of the United Nations (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=442&Itemid=52 1) United Nations Procurement Manual (http://www.un.org/depts/ptd/pdf/pmrev6.pdf) Transfer of equipment [Partnership and Legal Instruments] UNEP Partnership Policy and Procedures (http://docs.unon.org/cafc3fbf44ebb9212fa8b2282ae8f72941b7b55a.doc) UNEP Guidance for using Standard Legal Agreements (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=431&Itemid=52 1) 138 [Human Resources] Administrative Instruction on the Staff Selection System (ST/AI/2010/3) (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=435&Itemid=52 1) Administrative Instruction on Administration of Temporary Appointments (ST/AI/2010/4) (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=436&Itemid=52 1) UNEP Guidelines for Project Related Recruitment (http://www.intranet.unep.org/index.php?option=com_docman&task=doc_download&gid=445&Itemid=52 1) [Communication] UNEP Publishing Policy (http://www.unep.org/policy/Pub_Policy_SecondEdition.pdf) UNEP Web Governance Document (http://www.unep.org/policy/UNEP_web_governance_24September2011.pdf) 139