Pakistan’s Clean Environment Fund (CEF), created to support green projects and promote sustainable growth, has been inactive for almost ten years. This prolonged inaction has raised concerns about the government’s seriousness in tackling environmental challenges and climate change.
A recent audit of the Pakistan Environmental Protection Agency (Pak-EPA) for FY2023–24 revealed that the fund has failed to meet its objectives. Established in May 2015 under Section 42 of the Companies Ordinance, the CEF was meant to finance initiatives that protect Pakistan’s clean environment and strengthen climate resilience.
However, the audit report showed that no Annual General Meetings (AGMs) have been held since its formation, violating Section 132(1) of the Companies Act 2017. This non-compliance could result in penalties from the Securities and Exchange Commission of Pakistan (SECP).
The management also failed to prepare annual financial statements as required by law, raising concerns over transparency and accountability. The CEF Board, responsible for decision-making and fund management, has not been active despite having full authority to form committees and implement policies for Pakistan’s clean environment and sustainability.
In response, Pak-EPA officials said the delay was due to the Ministry of Climate Change and Environmental Coordination, which is responsible for nominating board members. While the Ministry recently approved a plan to hold a board meeting, no concrete progress has been made yet.
Auditors, however, rejected this explanation, calling it unsatisfactory. They warned that the fund’s inactivity has weakened Pakistan’s environmental performance and delayed crucial projects. They urged immediate action to restore the fund’s operations and ensure better oversight.
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Environmental experts say the situation reflects a larger governance issue. Despite facing challenges such as floods, smog, and deforestation, Pakistan struggles to effectively implement climate policies. The prolonged dormancy of Pakistan’s Clean Environment Fund highlights the country’s need for stronger institutions and better management to meet its environmental commitments.
