Learning
Climate finance terminology, made clear.
Concise definitions of the terms used in funding guidance and project preparation. Follow the context links to see how each concept affects a project or application.
Glossary
30 terms
Learning definitions that restate how the courses and profiles use each term. The official text of each fund or institution governs.
A
- Accredited entity
An institution accredited by a fund to present projects and hold the relationship with it. For the Green Climate Fund, projects are presented through accredited entities and executing organizations work within that structure.
B
- Baseline
The measured starting value against which an indicator target and change are judged. Every indicator needs one.
- Blended finance
Combining concessional and commercial capital to address a stated barrier, using grant, debt, equity, guarantee and technical-assistance layers.
C
- Carbon finance and Article 6
A mechanism class that monetizes verified mitigation outcomes under applicable market or cooperative rules, through credit purchase, results payment or cooperative transfer.
- Climate finance
Local, national or cross-border finance from public, private or alternative sources. The useful question is not whether money carries a climate label but what climate outcome, financial need and accountable use it serves.
- Co-financing
Other finance in the same project. State each source, its terms, status and role, avoid double counting, and keep confirmed and prospective amounts separate.
- Concessional finance
Finance on better-than-market terms. It needs a stated barrier and a proportionate role, and should not replace finance that would enter on similar terms.
- Concrete adaptation
An activity that responds to a defined climate risk and produces a visible reduction in vulnerability or increase in adaptive capacity. General capacity work should connect to delivery.
- Counterfactual
The without-project case, compared with alternative options, so that the preferred solution is not assumed.
- Country ownership
Evidence that a project follows national priorities: adopted plans, authority engagement and an endorsement path, rather than generic policy references.
- Critical gate
A condition that can stop a route whatever the average score: eligibility, access, legal authority, country ownership, prohibited activities or unresolved high risks. It is never averaged away by strong minor sections.
D
- Debt-for-climate or nature swap
A restructuring of sovereign debt that funds climate or nature commitments, negotiated between the sovereign borrower and participating creditors.
- Direct access
A route through accredited national or regional entities. It does not let any sponsor submit directly and does not remove accreditation, fiduciary, safeguards, technical or review requirements.
E
- Environmental and social safeguards
The process for screening and managing environmental and social risk under the controlling fund or institution and national framework. Screening begins during design, not after drafting.
- Evidence register
A record that separates each claim from its source, date, geographic fit, method and uncertainty.
- Executing entity
The organization that carries out project activities under the supervision of the accredited or implementing entity.
F
- Financial instrument
A way of providing finance that allocates cost, repayment, return and risk: grants fit costs without a repayment source; loans need repayment; equity takes ownership risk; guarantees cover defined losses.
- Funding route
An institutional and financial path, not a fund name: who can apply, which partner must lead and which instrument does the work.
G
- GEF Agency
An institution that prepares and supervises GEF-financed projects. Countries work through GEF Agencies and national focal points; there is no sponsor-direct submission.
- Green or climate bond
Use-of-proceeds debt for eligible projects, issued under a framework by a creditworthy sovereign, municipal, corporate or financial issuer.
- Guarantee
An instrument that covers a defined loss. It does not remove all project risk.
I
- Implementing entity
Under the Adaptation Fund, an accredited national, regional or multilateral entity central to access and supervision. National implementing entities provide the direct-access route.
- Indicator
A measure of a result. It needs a baseline, target, method, frequency and owner.
M
- Mechanism class
A type of finance, such as development bank sovereign finance or blended finance, that covers many institutions. The institution chosen sets the real rules.
N
- No-objection
A national authority’s confirmation, where a fund requires it, that a proposed project is consistent with national priorities. It sits within the national designated authority or focal-point process.
O
- Output, outcome and impact
Activities produce outputs; outputs support outcomes; outcomes contribute to impact. “20 drainage channels completed” is an output; “improved household resilience” is not.
P
- Paradigm shift
How change can persist, scale or alter systems beyond a single output. A large budget does not prove it.
R
- Results-based climate finance
Payment for verified outcomes, through an outcome payment, grant or purchase agreement.
S
- Sustainability-linked bond or loan
General-purpose debt whose terms are linked to material performance targets, with verification and a penalty design.
T
- Theory of change
The causal chain from activities to outputs, outcomes and impact, with its assumptions and external factors made visible.
Preparation
Use definitions in their institutional context
These definitions explain terms used on this site. A fund, lender or legal instrument may define the same term more narrowly. Check the document that governs your project and use the linked examples to see how the term affects preparation.
