Strengthening of external financial control in the environmental field

Project description

Title: Strengthening of external financial control in the environmental field
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Brazil
Lead executing agency: Tribunal de Contas da União (TCU)
Overall term: 2016 to 2020

Brazil: Audits of administrative action are expected to lead to improved measures for protecting biological diversity and adapting to climate change. © Werner Rudhart/GIZ


Environmental and climate policies require comparatively complex governance structures because the state has to take cross-sectoral action to implement them. Conflicting objectives for economic growth, environmental protection and social development make it difficult to carry out environmental measures effectively and efficiently and to achieve sustainable development goals.

One of the pillars of environmental governance is effective financial control of public expenditure by supreme audit institutions. In Latin America and the Caribbean these institutions have joined to form the regional association OLACEFS (Organization of Latin American and Caribbean Supreme Audit Institutions). Brazil's Federal Court of Accounts (Tribunal de Contas da União – TCU) is one of the 22 full members of OLACEFS. External financial control on issues relating to the environment is complex due to the intricate governance structures involved. The institutional and technical capacity of TCU and other OLACEFS members to conduct audits pertaining to the environment and institutionalise them is still very limited.


Brazil’s supreme audit institution and other OLACEFS members perform their task of auditing administrative action in the environmental field more effectively.


The project operates in three areas:

  1. Strengthening TCU’s auditing processes
    Methods and instruments, such as systematic performance audits, are adapted and refined for application in audits to be carried out in the environmental field in the region. They are to be used for example in coordinated audits, in which various supreme audit institutions harmonise their activities. They carry out joint planning, decide on a topic and the auditing method, conduct their audits according to an agreed schedule and coordinate their reporting.
  2. Promoting cooperation between OLACEFS members and improving the range of services they offer
    The methods and instruments are integrated into the knowledge management and monitoring system used by OLACEFS. Coordinated audits, peer reviews, seminars and workshops are adapted in terms of content and methodology for monitoring state action in the environmental sector. In addition, the project is developing an integrated training programme for audits on issues related to the environment.
  3. Supporting TCU and other OLACEFS members in their internal and external communications with stakeholders
    A strategy that takes due account of the individual target groups is being developed for communication with external stakeholders, such as parliament, civil society, the press, the general public and research institutions. Another strategy is being devised for OLACEFS to exchange knowledge with national and international research institutions and extension services working in the environmental field as well as expert bodies.


The project is strengthening external financial control. This is of key importance for the successful implementation of the national development strategy, which includes poverty reduction. Latin American and Caribbean supreme audit institutions are examining the measures adopted by government to achieve the goals of the 2030 Agenda for Sustainable Development This facilitates the monitoring of progress on Goal 2, for example, which sets out to end hunger, achieve food security and improved nutrition and promote sustainable agriculture.

The project is supporting the planning and implementation of a coordinated audit on cross-border management and protection of natural resources. By incorporating environmental criteria in the analytical tools, the issue of biodiversity is also taken into account in audits of infrastructure measures.

Mexico: XXVth General Assembly of OLACEFS, Querétaro, 2015.  © GIZ

The findings of the coordinated audit on legacy contamination, which was conducted with assistance from the project Support for the Organization of Latin American and Caribbean Supreme Audit Institutions (OLACEFS), were presented in October 2016. The results reveal that many of the 88 audited public institutions in the Latin American and Caribbean region do not have a functioning environmental liability concept that would preclude loopholes in the law and create clear responsibilities for any polluted sites and their remediation. In addition, the audit documented shortcomings in sectoral and institutional planning, insufficient capacities in terms of human resources and funds and dysfunctional information systems at the institutions concerned. The authorities responsible for the legacy contaminated sites were restructured as a result of the audit by the subnational supreme audit institutions in the provinces of Buenos Aires and Santa Fe.