Page 45 - CMA Journal (Nov-Dec 2025)

Focus Section

3. Policy Alignment and Implementation Gaps resulting in a ubiquitous top-down management
frame. The strategy generates suspicion at the
Although there is conceptual harmony, operational
sub-national level and impedes the natural
constraints are severe in the performance of the NCFS
integration of climate objectives into provincial
and PGT in implementing their joint mandate. The development planning (Public Sector Development
inherent problem is not the quality of the structures, the
Program - PSDP) and local governance frameworks.
poor implementation of their mechanisms.
Thus, provinces can prioritize short-term political
Governance Fragmentation and benefits over long-term, PGT-consistent projects for
Policy Incoherence climate resilience.
• Regulatory Overlap and Gaps: The PGT should be
The responsibility for climate finance is divided among at
construed and implemented in conjunction with
least seven major bodies. The policy of climate change is prevailing environmental, sectoral, and financial
set at the federal level, yet the fundamental acts of
laws. Different or conflicting rules on the SBP (as the
adaptation and mitigation, such as water resource
financial promoter of the PGT) and the provincial
management, agriculture, urban structures, and transport, Environmental Protection Agencies (EPAs) create
are left to the provincial and local governments. The regulatory uncertainty for financial institutions. For
governance system of both the NCFS and the PGT is not example, a green project that meets PGT standards
only divided but also highly bureaucratic, and is mostly not may still face inconsistent provincial environmental
aligned with political direction.
approvals. 5
Table 3: Key Ins tu ons and Their Roles in Pakistan’s Climate Finance Governance

Ins tu on / Body Primary Role in Climate Finance
Ministry of Climate Change (MoCC) Acts as the na onal policy custodian for climate governance and climate finance
strategy.
Ministry of Finance (MoF) Exercises budgetary control, allocates, and incorporates climate factors in public
finance.
State Bank of Pakistan (SBP) Cra s and implements green banking standards, climate risk repor ng standards,
and sustainable finance standards.
Securi es and Exchange Commission of Manages sustainability and ESG repor ng of corporate bodies and lis ng
Pakistan (SECP) companies.
Economic Affairs Division (EAD) Coordinates the interna onal climate finance and oversees loans, grants, and
donor rela ons.
Na onal Disaster Management Leads resilience planning, disaster risk reduc on (DRR), and climate-related
Authority (NDMA) emergency management.
Provincial Planning & Development In charge of project-level implementa on, appraisal, and implementa on of
Departments climate-related development ini a ves.

The NCFS suggests coordination mechanisms, but Technical Capacity and Data Deficiencies
without power, coordination is just empty talk. Projects
that are undertaken in different ministries are usually PGT is a highly technical instrument, and the lack of
similar, leading to duplication of the project, policies specialized skills compromises its screening validity and
being at odds, and delays in executing the project. This the NCFS's responsibility. The provincial and district
kind of structural division is more likely to bring about governments, as the last mile of project implementation,
policy incoherence and a vacuum in implementation: do not have adequately skilled human resources, green
engineering, or environmental accounting to apply the
• Coordination Overload: Climate action requires
coordination across many institutions. The NCFS technical thresholds of the PGT correctly in the face of
suggests several inter-agency committees, including technical challenges. Moreover, the NCFS has been based
the Steering Committee (Committee of Secretaries) on the credibility of a three-tier accountability framework
and Provincial Technical Committees. Nevertheless, and a National Climate Finance Portal to attract
when there is no central institution with binding innovative finance. Nonetheless, the monitoring systems
power over provincial budgets and sectoral in the public sector are not as transparent or reliable as
departments, the committees are likely to the verifiable data on emissions reductions and
degenerate into consultative forums, diminishing expenditure tracking. The absence of strong data renders
4
decision-making and causing turf wars . international investors who can benefit from the NCFS
vulnerable to the prohibitively high risk of Pakistani
• Top-Down Policy Syndrome: Critics observe that climate projects . 6,7
climate policies, such as the NCFS, have been
developed through the federal consultation process,

ICMA’s Chartered Management Accountant, Nov-Dec 2025 43