An interdisciplinary approach to the Loss and Damage fund: exploring potential applications and guiding principles

After decades-long advocacy by low- and middle-income countries, the establishment of a Loss and Damage fund during the Conference of Parties 27 was monumental. The Loss and Damage fund unlocked practical avenues to climate justice. It recognises the responsibilities of rich countries with respect to greenhouse gases that exacerbate climate change and disproportionately impacts vulnerable countries. With the fund still in its infancy, it is crucial to differentiate between types of finance that are suitable for other forms of climate action from finance intended specifically to address loss and damage. We consider potential applications of the funding for different sustainable development issues including water resources, energy, transport, human rights and security for a high-functioning Loss and Damage fund. We also highlight the need for the Loss and Damage finance to be attentive to and be able to redress some of the root causes of vulnerability while providing low- and middle-income economies with the support they need in the face of climatic impacts. We propose four guiding principles towards a high-functioning Loss and Damage fund: consistent contributions, clarity in governance, community-driven solutions and fund allocation, and corruption-free systems. We argue that applying those principles promotes climate justice and human rights, and inclusive fund governance. Being community-driven requires such funding to be reactive to climate events, yet proactive in understanding affected communities' needs so that finance allocated is not just a band-aid solution but a long-term and just solution to climate resilience.