In November 2020, the Netherlands froze €10 million – a third of its annual donation to United Nations Development Programme (UNDP) projects – over the UNDP's failure to investigate an energy-saving programme in Russia facing multiple corruption allegations.

The programme included an €8 million UNDP project, funded by the Global Environment Facility (GEF), to adapt energy efficiency standards to European levels between 2010 and 2017, significantly reducing greenhouse gas emissions. However, the final evaluation concluded the project failed to deliver any emissions reductions, although several whistleblowers tried to expose corruption throughout implementation.

Among them was Dmitry Ershov, who was recruited in 2012 to manage the project. In 2018, he filmed an urgent message alerting key international donors to serious misappropriation of funds at the UNDP Moscow office.

Ershov claimed the office lacked safeguards against fraud, with Russian officials responsible for overseeing project funding routinely awarding contracts to relatives and associates and recruiting unqualified staff. After Ershov raised his concerns, officials expressed dissatisfaction with his performance and refused to renew his contract in 2014.

Ershov reported the alleged corruption to the UNDP’s regional headquarters in Istanbul, claiming he was a victim of retaliation. However, senior officials dismissed him as seeking revenge, implying the irregularities were the Russian government’s responsibility.

Alternative complaints channels proved no more responsive. The UNDP's Ethics Office said it had no mandate to investigate corruption, while the Office of Audit and Investigations (OAI) declared Ershov's case was not a matter for investigation. GEF officials bounced responsibility back to the UNDP, claiming limited authority over UNDP projects. In late 2020, Ershov presented the GEF Council with his video, urging them to investigate the case independently.

Ershov is among several former UN employees, auditors and consultants who raised the alarm about UNDP's use of GEF funds to reduce greenhouse gas emissions in Russia. Concerns arose in 2011 but were continually dismissed by international UNDP management and donor governments.

The project's confidential 2017 evaluation report found strong indicators of deliberate misappropriation of millions of dollars, concluding that it achieved no useful outputs or emissions reductions.

The report surmised that funds had been embezzled, noting multiple conflicts of interest and that anyone raising concerns was pushed aside. Consultants were threatened with non-payment unless they assessed the project favourably.

The report finally prompted the OAI to take action. Investigators found "irregularities", including private companies sitting on a committee that approved contracts while bidding for those contracts. But the office closed the case, claiming Russian officials had failed to understand UNDP policies.

Despite alarm calls from at least seven whistleblowers, donor governments avoided making sensitive criticisms of a recipient country responsible for checking whether money was correctly spent. Canada and Norway told one whistleblower they were satisfied the UNDP had investigated the Russia programme. The United States passed Ershov's case to the central UN oversight office, which referred it back to UNDP investigators.

But in early 2020, with complaints persisting, 12 major donor countries demanded an independent investigation into the project, along with improvements to UNDP anti-corruption measures.

The resulting independent review concluded in December 2020 that senior UNDP management had repeatedly ignored red flags, corruption was highly likely on the project, and whistleblower complaints needed re-examining.

Dutch officials froze their funding in late 2020, citing insufficient UNDP action. If other donors follow suit, finance urgently needed to tackle climate change will be unavailable.

The case highlights the crucial need to support whistleblowers in the fight against climate change. By taking action when complaints like Ershov's are first raised, donors and officials can safeguard vital projects from corruption and ensure they achieve their goals.

• All climate adaptation and mitigation projects need accessible reporting channels and a culture of openness, welcoming those who call out malpractice rather than relying on whistleblowers' persistence and courage in overcoming barriers to speaking up.
• Project donors, funders and implementing agencies must establish clear and explicit guidelines for receiving and investigating complaints to prevent buck-passing and circularity in handling reports.
• Project oversight must be completely independent – including from recipient country officials – to prevent conflict of interest or collusion. Organisations such as the UNDP should refrain from self-evaluations or investigations, while bodies like the UNDP's Office of Audit and Investigations should be reformed to be fully independent of management.
• The UNDP Ethics Office needs strengthening to instigate investigations into malicious reports against staff who cooperate with ongoing investigations rather than concluding these are out of their power to investigate.