(2nd meeting) Executive Board of UNDP, UNFPA and UNOPS (First regular session 2026)

Good afternoon, everybody. Good afternoon. May I have your attention so that we can get started? Thank you very much.

I now Declare open the second meeting of the first session, first regular session 2026 of the executive board of UNDP, UNFPA and unopened. We will now continue the joint segment of Agenda Item 2. Recommendations of the Board of Auditors covering the UNDP, UNCDF, UNFPA and UN OPS reports on the status of implementation of the recommendations of the Board of auditors for 2024. Joining me on the podium here we have Ms. Linda McGuire, Assistant Administrator and Director, Bureau of Management Services, UNDP. Mr. Andrew Sabaton, Deputy Executive Director for Management, UNFPA.

Mr. Carl Ludwig. So, Chief Financial Officer, UN OPS. Mr. Pradeep Karl Kurukula Suraria. Yeah. Executive Secretary, UNCDF.

Also joining us from the United Nations Board of auditors are Mr. Richard Belling, Director of External Audit Finance and Chair of Audit Operations Committee. On UNDP and UNCDF, we have Mr. Mauricio Wanderle, Director of External Audit, Brazil for UNFPA and Mr. Sheng Ronnie Gee, Director for External Audit, China for UNOPS. We now proceed as follows. Opening statement by the Chair of the Audit Operations Committee for the UN Board of Auditors. Presentations by the entity representatives and comments from members and observers of the Executive Board.

It's now my pleasure to invite Mr. Richard Belling, Chair of the Audit Operations Committee to deliver his opening remarks on behalf of the United nations board of auditors. Mr. Belling, you have the floor.

Thank you, Mr. Chair. Distinguished members of the Board. Members, thank you for this opportunity to present the cost cutting findings from the Board of Auditors on the financial statements and operation of UNDP, UNCDF, UNOPS and UNFP for the year ended 31st December 2024. News.

The Board has issued unqualified opinion on the financial statement of these four entities. As for the entities under the portfolio of France, UNDP and uncdf. On UNDP with respect to the financial audit, the Board questioned the legal framework governing the medical insurance plan and issued further recommendation to strengthen accounting controls. Regarding the cooperation with other UN entities, the Board noted the key role played by UNDP at both global and field levels. Thanks to its worldwide presence, the Board issued recommendations to enhance its integrator function, with particular emphasis on shared services.

The Board also noted the UNDP's crisis offer is well implemented, but we made recommendations to streamline the procedures. In addition, the Board issued recommendations on the management of individual consultants, noting the need for improved monitoring of the policy and stronger support to country offices. When it comes to uncdf, the Board made observation and recommendation to tighten accounting controls and improve the quality of information disclosed in the financial Statement. With regard to the cooperation between UNCDF and the other UN entities, the Board noted the lack of institutional visibility of UNCDF and issued recommendation to enhance its field presence, activities related to loans and guarantees and improve communication towards partners, beneficiaries and donors. With respect to the status of implementation of previous Recommendation as for UNDP, as at 33rd December 2024 out of 40 outstanding recommendations 29 had been implemented representing 73% compared with 67% in 2024 while 11 remained under implementation 27%.

With respect to UNCDF, out of 9 outstanding recommendations, 5 had been implemented representing 56% compared with 100% in 2024, 3 being still under implementation 33% and 1 having been overtaken by events 11%. As I have called, I will leave the floor to my colleague Mr. G to make the presentation on UNOPS.

Thank you Chair and your distinguished members of the Committee. And now I'm going to talk about the four key fundings I would like to bring to your kind attention for unops in 2024 financial year. First, despite the increase in S3I funds recovery budget from 8 million to 17.2 million, no recovery had been achieved with the total expenditure amounting to 9 million as of end 2024 financial year, raising concerns about the effectiveness of the resources committed thereto.

Second, weakness in a major infrastructure project management led to a dispute on eligibility of the project expenditure of 62.13 million which had been disclosed as a contingent liability in the 2024 financial statements. This kind of key weakness we have identified include not conducting the post factor review as required by the Engagement Acceptance Committee at the time of signing a high value amendment to the agreement for the project. Second, implementing design changes without undergoing the required technical review and approval etc. Third, insufficient enforcement of the individual accountability for 49.6 million of the write offs and provisions in relation to 154 projects from 2022 to 2024.

Between 2022 and 2024, 12.47% of UNOP's procurement with a total value of 608 million was conducted through direct contracting and the Board noted instances of insufficient justification for exception from the formal procurement process raising concerns about the consistency, transparency and compliance. In terms of the status of the recommendation implementation, we have noted that for 2024 65% of percentage implementation rate has been noted compared to 58% for financial year 2023, indicating an increase in this regard. And thank you. Thank you. Mr. Qi and Mr. Wanderley for UNFP.

Thank you, Mr. Chair. Distinguished members of the executive board regarding UNFPA, during our audit, the Board noted the following observations that I'd like to bring to our attention. First, weaknesses in the governance, risk and compliance framework within the Supply Chain Management Unit. These include outdated policies, the absence of fully developed planning frameworks or work plans, and gaps in structured risk management and process mapping.

The second one, weaknesses in lead time management within the supply Chain Management unit, including fragmented management and limited ability to evaluate supplier performance using quantum data. The Board noted that no lead time statistics were produced in 2023 and fragmented internal management hindered the organization's ability to deliver goods efficiently. The third one, weaknesses in ICT project management. Although a formal methodology exists, its application was inconsistent. In a sample of seven key projects, including system for shipment tracking, budgeting and donor reporting, essential documentation such as project plans and risk register was missing or incomplete.

Finally, inconsistencies in documentation and system records for cash transfers to implementing partners. These include missing or incomplete mandatory forms, inadequate supporting documentation and weakened enforcement of documentation protocols. In terms of status of implementation of preview recommendations, as At 31st December 2024. Of.

The 49 outstanding recommendations, 19 representing 39% had been implemented. This concludes our introductory statement and my colleagues and I will be happy to answer any questions and provide any information that the Board may require. Thank you for your kind attention. Back to you, Mr. President.

Thank you very much to the three presenters.

I now invite Ms. Linda McGuire to introduce the UNDP report on the status of implementation of the Board of auditors for 2024. Ms. McGuire, the floor is yours.

Thank you, Mr. President. Good afternoon, distinguished members of the Executive Board, Members of the UN Board of Auditors, ladies and gentlemen. At the outset I would like to congratulate the new members of the Executive Board on recent election.

It is a pleasure to present UNDP's management response on the status of implementation of the recommendations of the UN Board of Auditors for 2024. I would like to thank the Board members for their continued engagement in the constructive dialogue held during the informal consultations. In July 2025, the Board of Auditors issued an unqualified audit opinion on UNDP's financial statements for 2024. This marks 19 consecutive years of clean audit opinions reflecting UNDP's sustained commitment to transparency, accountability and sound financial management under ipsas. While we take pride in this achievement, we view it as a responsibility to maintain strong risk based controls and continuously improve our systems and practices.

For the 2024 audit cycle, the Board of Auditors issued 38 recommendations, all of which management has accepted and begun to implement. Of the 40 recommendations open at the beginning of 2024, UNDP has fully implemented 73% with the remaining recommendations progressing according to agreed timelines and expected to be closed in 2026. There are no outstanding recommendations from audits prior to fiscal year 2023. Financial Statement Audit Report the recommendations that do remain open primarily reflect actions that require system enhancements, policy development or phased implementation to ensure sustainability. These are subject to senior management oversight with clear accountabilities, periodic monitoring and targeted follow up to ensure timely and durable implementation.

While UNDP is a decentralized global organization, we continue to seek an appropriate balance between decentralization and effective oversight. Over the past year we have strengthened accountability and oversight systems to reinforce governance controls and risk management. In this context, UNDP has strengthened financial and budget processes through clearer cost classification, improved budget execution guidance and allocation practices aligned with Executive Board decisions. In financial management, UNDP demonstrates a strong and mature IPSAS compliant financial control environment with continuous process refinements that safeguard financial reporting integrity and sustain its record of clean audit opinions. UNDP continues to actively monitor liquidity, including core resources through disciplined financial planning.

Looking ahead, UNDP is further strengthening its assurance framework through the implementation of a statement of internal control over financial reporting for the 2026 financial statements. In line with Executive Board guidance and consultations with oversight bodies with respect to the management of individual contractors, UNDP is strengthening policy clarity and oversight, including targeted assistance to business units to ensure consistent application and compliance across the organization. With respect to cooperation with other UN entities, UNDP continues to strengthen its role as a system integrator and service provider, advancing shared services and system wide efficiency initiatives and will report to the Board on the integrator function. In the area of crisis response, UNDP is strengthening preparedness and oversight through clearer frameworks, improved criteria and risk informed programming applied consistently across operations. Taken together, management actions to implement the Board of Auditors recommendations have reinforced risk based internal controls and accountability across key functions, thereby strengthening the organization as a whole.

In closing, Mr. President, I want to reaffirm UNDP's commitment to the work of the UN Board of Auditors and thank them for their excellent collaboration. My colleagues and I are ready to address any questions you may have. Thank you.

Thank you very much, Ms. McGuire and now invite Mr. Andrew Sabaton to introduce the UN FPA report on the status of Implementation of the recommendations of the Board of auditors for 2024 Andrew, you have the floor.

Thank you, Mr. President, distinguished members of the Executive Board, I am pleased to introduce the report on the implementation of the recommendations of the United Nations Board of Auditors for the year ended 31st December.

I would like to acknowledge the presence of the Board of Auditors at this session and thank them for their continued engagement and constructive oversight. We value the ongoing dialogue with the Board of Auditors whose recommendations play an important role in strengthening the quality credibility of audit follow up accountability, governance and institutional learning throughout UNFPA for the 14th consecutive year, UNFPA received an unqualified audit opinion. The Board of Auditors confirmed that the financial statements present fairly in all material respects the financial position and performance of the Organisation in accordance with the International Public Sector Accounting Standards. The board also noted UNFPA's sound financial position and strong liquidity, reflecting sustained attention to financial discipline and stewardship. Turning to implementation, UNFPA entered 2024 with 49 outstanding recommendations from prior period.

During that year, 19 of these recommendations were fully implemented, representing 39% of the opening balance. In addition, the Board of auditors issued 26 new recommendations for 2024. A significant proportion of the recommendations that remain under implementation relate to system changes or policy revisions. These recommendations, by their very nature, require phased actions, careful testing and change management to ensure that solutions are durable and embedded in operational practice. Addressing root causes may therefore in some cases take longer to complete.

However, management applies clear milestones, active senior level oversight and regular quality review to ensure that recommendations under implementation continue to progress towards closure. This implementation profile also reflects the increasingly complex risk experience environment in which UNFPA now operates. The Organization is currently delivering humanitarian assistance across 42 countries, which places sustained demands on systems controls and oversight arrangements. Taken together, the recommendations from 2024 and prior years represent a total of 56 recommendations under management. Consideration of these 23 recommendations have already been submitted to the Board of Auditors for review and closure based on completed actions and supporting evidence.

A further 23 recommendations are currently under active implementation and are expected to be ready for review by the Board of Auditors by the time they come to UNFPA in April 2026 in line with their agreed implementation timelines. The remaining recommendations continue to be addressed through phased implementation, reflecting the multi year nature of enterprise reforms, policy alignment and system enhancements. Beyond individual recommendations, UNFPA has continued to strengthen the quality and governance of audit follow up, a more structured quality review process has been introduced for action plans and closure requests for strengthening consistency, evidentiary standards and management accountability before recommendations are presented to to the Board of Auditors. The operating model of the Oversight and Compliance Monitoring Committee has also been reinforced. The effectiveness of the Committee has been recognised and its remit expanded to cover a broader range of monitoring and assurance processes, including follow up on evaluations and other external assessments.

This has enhanced senior management oversight and helped ensure that implementation challenges are identified early and addressed in a timely manner. Looking ahead as UNFPA moves into its next Strategic Plan and integrated budget for 2026 2029, management will continue to strengthen governance, accountability and internal control systems. The new Strategic Plan and integrated budget include dedicated investments to reinforce the second line of defence, complementing independent oversight functions and strengthening management accountability for risk management and internal controls. In conclusion, UNFPA welcomes a report of the Board of Auditors and remains fully committed to implementing all recommendations in a timely and comprehensive manner, with a strong focus on sustainability, credibility of closure and institutional learning. I thank the Executive Board for its continued guidance and engagement and my colleagues and I stand ready to respond to any questions you may have.

Thank you, thank you very much. UNFPA we now move to UN Ops. I now invite Mr. Carl Ludwig Sow to introduce the UN Ops report on the status of implementation of the recommendations of the Board of auditors for 2024. Mr. So, you have the floor.

Thank you, Mr. President, Mr. Chair, distinguished delegates and colleagues, it is a distinct honor and great pleasure to address you today at this first first Regular session. I wish to begin by stating that UNOPS has once again been issued an unqualified audit opinion by the Board of auditors on our 2024 financial statements, marking the 13th consecutive year we have achieved this since adopting international Public Sector accounting standards in 2012.

It underscores our unwavering commitment to transparency, accountability and sound financial management. UNOPS Management holds the recommendations of our oversight bodies in the highest regard in relation to the closure of UNBOA. Recommendations for the 2024 financial year UNOPS demonstrated robust operational efficiency by achieving an implementation rate of 65%, representing a 4% increase when compared to the preceding financial year, a positive trend reflecting the effectiveness of our corrective interventions. The 2024 Board of Auditors audit concluded with 23 new recommendations, bringing the total number of open recommendations to 34, including 11 carried over from the previous years. Building on this positive trajectory, we are targeting to implement 68% of these open recommendations during the 2025 financial year.

Already, the BOA reviewed and accepted to close 13 of these recommendations during the last interim audit. We anticipate successful closures of the remaining recommendations. Doing their BOA audit scheduled for April 2026. I wish to highlight some of the key impacts that implementing the Board of Auditors recommendations had had on our organization and customers. Culture Risk Management the establishment of the UNOPS Portfolio Oversight Committee replacing the former Engagement Acceptance Committee marks a significant organizational improvement, specifically enhancing engagement, risk management and overall risk management capabilities.

Operational since May 2025, the POC ensures that high stake engagements are appropriately managed to protect the organization and maximize UNOP's impact. By providing an independent high level forum for review, the POC facilitates the early identification, comprehensive assessment and effective mitigation of potential issues, risks and challenges. More importantly, this new framework supports risk informed decision making not just at the start, but throughout the project life cycle. Structural treasury and Investment Reforms in response to recommendations on treasury operations including financial derivatives, UNOPS has undertaken a comprehensive treasury structural reform. This new structure enhances internal control mechanisms, focusing on reporting lines and organizational structure to ensure a robust segregation of duties.

Key changes include the addition of resources and expertise, particularly in risk management and compliance with UNOPS policies. A new Senior treasury leadership position has been created to oversee both teams with a reform structure with responsibilities spanning front, middle office and control functions. Emergency Procurement Procedures Per Board of Auditors recommendation, UNOPS completed a comprehensive assessment of its emergency procurement procedures to improve responsiveness and operational efficiency during emergencies. Furthermore, UNOP streamlined processes to strengthen oversight and accountability, leading to better planning, stronger procurement controls and greater reliance on standard procedures. Lastly, Procurement Pre selection Approval Process the BOA recommended strengthening the approval process for preselection from UN funding sources.

This impact of our implementation is a more robust and compliant procurement process for unops. We explicitly require confirmation of delegation of authority structures in all project agreements, ensuring that the necessary delegated authorities within the agencies are in place for the preselection process. This has helped strengthen our internal review process, boasting both efficiency and compliance of our preselection activity activities. Being conscious of time, I would like to conclude my statements here by referring UNOPS Management's commitment to continuous improvement and full implementation of recommendation from all oversight bodies. Thank you for your time and attention.

Thank you very much. Mr. So finally I invite Mr. Pravid Kulasuria to introduce UNCDF report on the Status of implementation of the recommendations of the Board of auditors for 2024. Mr. Pradeep thank you.

Chair, Excellencies, Distinguished members of the Executive Board, Members of the UN Board of Auditors, Colleagues, I'm pleased to present an update of UNCDF's implementation of the recommendation of the UN Board of Auditors of 2024.

Let me begin with a headline message. The findings of the audit indicate that UNCDF has undergone a deep transformation and is ready to we fulfill our unique mandate to catalyze capital for development. We hope that that will increase your trust and confidence in UNCDF as a critical tool to deploy to support job creation. Private Sector development in early stage high risk markets first and foremost in LDCs for the 13th consecutive year, UNCDF has received an unqualified audit opinion. Recognizing the soundness of our financial statements and underlying controls.

We have also moved on and beyond the issues raised by performance audits in 2023. Recent follow up audits on UNCDF's performance have provided a 100% clean bill of health. This is testament to how the organization how far the organization has come over the last two years. We acknowledge that how we respond to these recommendations shapes our future. First, we take ownership.

UNCDF does not have any long outstanding audit recommendations. All have been addressed within agreed timelines and are advancing as planned. This reflects the culture of accountability we are deeply committed to one where every recommendation drives organizational improvement, enabling us to deliver at the scale and speed required. In 2023, as just noted, the Board of Audiences issued nine recommendations on planning, budgeting and linking resources to results. All 2023 recommendations had now been implemented by UNCDF.

Three are in the process of being closed by UNBOA. Out of the nine recommendations in 2024, seven relate to the cooperation with other entities of the United nations system, while two concern financial management. Importantly, the nature of these recommendations reflect an increasing focus on the coordination, alignment and interoperability within the UN system. They have been integrated into our new strategic framework 2026-2029 and are on track to close by year end. Second, we acknowledge that the observations regarding the pace of financial instrument deployment this question goes to the heart of UNCDF's evolution.

Over the past 18 months we have undertaken a comprehensive reform process. We have developed and operationalized a suite of financial instruments unique in the UN system. Loans at 0% or very low interest guarantees and investment grants, all calibrated to absorb early stage risk in markets where DFIs and other traditional banks find difficult to operate in. This transformation has been externally validated, most notably to the European Union's Pillar 6 assessment, which recognized the rigor of our fiduciary systems and strategic positioning. Yet there remains a fundamental dependency our ability to deploy these instruments at Scale hinges directly on the predictability and adequacy of our capitalization.

Our integrated budget reflects that two thirds of the planned delivery will flow through financial instruments. Demand from program countries exceeds even this. Our pipeline demonstrates the appetite for catalytic finance. The question before us is whether we can match this demand with commensurate resources. For that we are in your hands as a Member State Dirin organization.

To conclude, as the DSG mentioned this morning, we need to modernize the business model of development assistance in this regard. As UNCDF readies itself to channel catalytic finance in support of the UN system, we know that discipline, audit, follow up and accountability are non negotiable. We embrace this truth. At the same time, meeting the Member States expectations requires operating at a much faster and larger scale than we're able to do so at present. Scaling up and amplifying the reach and impact called for by Member States.

First and foremost, LDC's requires your support to grow our capital base. Without predictable core and non core program resources, we risk being asked to generate system level impact while being financed project by project which is neither efficient nor nor responsible. We must reverse that. FFD4 calls for it. We look forward to your continued engagement grounded in trust and action.

Thank you Chair.

Thank you very much. Pradeep. That is the set of presentations that we have. Ladies and gentlemen, distinguished delegates.

I now open the floor for your comments and questions. I now open the floor. Kindly press the button if you have any interventions you'd like to make.

I do not see any request for the floor. I think our presentations were quite to have. Oh, thank you. Thank you very much. We have two requests for the floor.

The first will be the Kingdom of the Netherlands and then followed by the United States Kingdom of the Netherlands. Your pleasure.

Thank you, Mr. President. The Kingdom of the Netherlands commands UNDP, UNCDF, UNFPA and UNOPS for receiving unqualified audit opinions and for their overall commitment to improving accountability and transparency. We encourage the agencies to fully implement all outstanding recommendations in a timely manner. Additionally, we have a few questions. Based on today's presentations and the documentation shared first to unfpa, the Board of Auditors indicated there were weaknesses in the governance risks and compliance framework within the Supply Chain management unit.

Supply chain management, particularly risk management in this area, was identified as an attention area also last year. What are the root causes of supply chain management being a recurring area of improvement? And how is UNFPA tackling these? The Board of Auditors also had several recommendations regarding donor agreements. Could UNFPA share more on what negative effects and risks the weaknesses in donor agreement tracking may have caused and how is this being addressed?

Second to UNDP, we noted with interest the recommendation to expand UNDP's global services with other UN agencies. Where does UNDP see the strongest interest so far and what are the main challenges in this area? We also highly value the work of UNDP's Crisis Bureau and welcome the Board of Auditors recommendation to improve risk informed programming in the preparation of Country Program documents. How is work progressing in this area and finally, given the decline in core resources, are there any impacts on the implementation of Board of Auditors recommendations Then to unops? We would like to underline the importance of UNOPS ongoing efforts with the UN Office of Legal affairs to recover funds related to the S3I initiative.

We welcome all steps taken to strengthen risk management and escalation mechanisms and stress the need for continued attention to these processes. We also wonder does the Portfolio Oversight Committee have sufficient capacity and expertise to manage the expected volume and complexity of high risk engagements and how will effectiveness of this committee be evaluated moving forward? To conclude, we again thank all agencies for their continued commitment to improving accountability and transparency and look forward to continuing these discussions. Thank you.

I thank the distinguished Representative of the Kingdom of the Netherlands and now give the floor to the distinguished representative from the United States.

The floor is yours.

Thank you very much Mr. Chair and thank you to the presenters for the information we have. A few remarks I'll target per agency for UNDP the United States insists that UNDP address all identified weaknesses in financial management, including revenue recognition, donor refunds and risk assessment. UNDP must ensure that US Taxpayer funds are safeguarded, properly allocated and subject to strict oversight.

The United States expects UNDP to fully implement all Board of Auditors recommendations with clear timelines and measurable outcomes. Partial or delayed compliance is unacceptable. We will monitor progress and demand corrective action where necessary for unops. The United States is concerned about the mismanagement of the major infrastructure project as described in in the BOA Report. This represents fundamental governance failure.

The United States demands full disclosure of all projects with similar risk profiles and immediate corrective action. The United States is also concerned about the significant inconsistencies noted in the BOA Report related to the methodology for calculating liquid excess reserves. Financial reporting must be accurate, transparent and transparent. The United States urges the Board to exercise enhanced oversight over the reserve levels and use of the reserves. The United States also demands immediate resolution of the BOA recommendation related to direct contracting.

This violates fundamental procurement principles and we demand stricter controls Enhanced guidance and regular reporting on direct contracting exceptions for uncdf. The United States demands immediate action on implementation of all nine new audit recommendations with claim clear timelines, formal reconciliation procedures for interagency transactions, complete IPSIS 39 compliance for financial reporting and enhanced data systems for tracking, cooperation, activities and field presence for uncdf, UNOPS and undp. The United States expects the highest standards of financial management accountability and transparency from UN entities. The 2024 audits reveal systemic failures that must be addressed immediately. We will not accept business as usual when tens of millions in donor funds are lost without accountability.

I have a few more comments and I will submit the entire comments for the record.

Thank you very much. Thank you very much. Just checking if there are any requests for the floor.

I see none. And so with your permission, I'll go to the presenters. We'll go in the order of institution. We'll start with UNDP if you're ready. And then UNFPA, UN Ops, and then UNCDF, UNDP.

The floor is yours, Ms. McGuire.

Thank you. Thank you very much to the Kingdom of Netherlands and to the United States for the close read of the report and also our management response expansion of Global Shared Services. So this is something that's actually taking place within the context of the the Business Innovations Group and the High Level Committee on Management, the far reaching efficiency initiatives. I was looking for the right acronym and UNDP is being asked to step up and really put its operational platform at the service of other agencies and entities.

So we do see an expansion hopefully happening there and also work to optimize our Global Shared Services Center. So what areas? I mean definitely areas such as payroll, payments, human resources services, use of different contracting modalities as well. And as you know, the Quantum ERP now services 11 different UN entities and agencies. So just to watch that speaker, because it is part of the overall work stream one in a sense of UN80 as well and on crisis for sure, this is something that is mentioned in the UN BOA report and something that we've put in with the Crisis Bureau revising our definition which is now embedded in the UNDP Crisis Response Standard Operating Procedures.

And of course our Crisis Bureau will oversee that implementation and compliance with the new definition and also the updated definition and the declaration criteria for when we declare a crisis and the different levels they are aligned with the wider UN system approaches. And this of course helps ensure the coherence between the Crisis Response Framework and of course the UN Emergency Coordination Mechanisms and on recommendations of UN BOA vis a vis, you know, Declining core resources. I wouldn't say that we see a one to one relationship in any way. We're trying to really adapt and implement to the U.S. s point, implement as quickly as possible the recommendations within resources and in fact some recommendations can potentially help us be even more efficient and cost effective. So just to the US Points.

Thank you. So you know we do have, as I mentioned, an implementation rate of 73% at the moment and we submitted about 11 recommendations in February for assessment. Hopefully those will be closed soon and we do not have any long standing in that sense. Recommendations that are open, as I said beyond fiscal year financial statement 2023 there is nothing open. But we take very much the point.

We stay on top of this. We're constantly reviewing and trying to adapt our systems and processes to be better with with UnBoas help.

Thank you. Thank you very much. We have now UNFPA.

Andrew. Thank you Mr. President and I had two question areas from the Netherlands. Let me start firstly with the supply chain and the areas of, you know, the number of recommendations issued by the Board of Auditors.

Let me tell you supply chain management actions are underway to strengthen the planning frameworks, risk and oversight models, lead time management, last mile assurance and governance of procurement and pre position stocks. These recommendations address both the global supply chain functions and the country level implementation.

Several of those actions include the development of standardized methodology, improved systems and dashboards and clearer accountability across headquarters, regional and country offices. Implementation is being sequenced to ensure consistency, operational feasibility and sustainability. Sustain improvements rather than just short term fixes that would have been a lot quicker. But what I can say when the Board of Auditors at this moment, by the time the Board of Orders visitors in April, all bar one of those recommendations are planned to be presented or have already been presented foreclosure. So that will be importantly.

Well, why is this happening? The supply chain management unit from 2023 right to the end of 2025 has been going under quite a significant change. We had a completely new restructuring in 2024 of the supply chain unit which actually resulted in 33% growth in the number of positions there. As we move some standard procurement to actually a full supply chain that included forecasting as well as last mile assurance and and linkage with the humanitarian sphere of work linked to that structure which is now based on a much stronger four pillar structure as opposed to the previously flat structure that we had. We launched a new strategy in the last few weeks of December 2024.

So it's only come up for implementation last year and also in 2024 you had the implementation of the new ERP. ERPs are, as everyone would appreciate, this most significant area of ERPs is in supply chain management and supply chain automation. So there was a lot of work going on there, all of which is strengthening the supply chain. But a lot of change was going on and I must actually say we have been able to acquire a lot of significant private sector and academia investment to make our supply chain the best in category and importantly a much stronger linkage with our humanitarian division as how supply chains differ in humanitarian settings rather than they do in the development settings. And perhaps just to finalize that is to say that the success of the supply chain continues and has been historically and always will go forward have been is a 100% self financing unit.

It does not use any contributions either earmarked or core. It is self financing either to third parties or to internal business units. As regarding the contributions and revenue management, I mean this is really a question of purely upgrading our systems and guidance to improve documentation. You will recall that we went live with both the Quantum ERP but also the Salesforce Customer Relations Management in the same year. The two have had to come together because the process evolved over sorry was historically over two sets of units.

But we've now improved the systems and guidance to improve the documentation traceability and the reconciliation of donor agreements. The real challenge to the revenue recognition as faced now by all UN organizations will be the implementation of the new IPSAS standards which will require careful alignment of accounting treatment system functionality and staff guidance to ensure compliance and transparency. But we're well on the way for that. We've already got plans to implement those, so there should be no problems on that front. Thank you very much.

Thank you very much. We'll hear from now UN Ops.

I appreciate the questions from the Kingdom of the Netherlands on the United States. They were a little bit overlapping. So let me start with the S3I related question. So UNOPS continues to work closely with the UN Office of Legal affairs to continue the Fund's recovery efforts as well as efforts for criminal accountability related to S3I. At the first regular session of the EB in 2025, the EB, the executive board approved the allocation of additional funds from its reserve to continue these efforts until the end of 2027.

As recognized by the Executive Board. The nature of the recovery process requires a multi year plan. So we didn't really expect results instantly after approving this plan. So UNOPS has committed to provide updates about the progress of their recovery efforts to the Executive Board at closed sessions, at the annual session. So that's the next session.

So that's the S3I process. With respect to the Portfolio Oversight Committee which is a significant enhancements that we introduced in 2025 was exactly to enhance the capacity and the ability of UNOPS to deal proactively with high risk and highly complex engagement. So it's strategically structured to manage both volume and complexity of these engagement. It comprises senior leadership at the director level from every headquarter practitioner units ensuring cross functional expertise. It's led by the Deputy Executive Director Management and Policy and to maintain rigorous oversight without compromising the capacity.

The POC utilizes a consultative review process and there are intense and multiple processes going on with regional and country directors. This collaborative model ensures a high stakes engagement are subject to a special technical scrutiny. And it has the full capacity and bandwidth to do this at headquarter level with the input of local risk assessment. The second question was from the United States was with respect to the mismanagement of Project A, we have to say it's like the 2024 financial statements. We took a deliberately more conservative approach in disclosing any kind of project risks.

And that's reflected in more not only in write offs or provisions but also in contingent liabilities which are related to risks that we say are less likely to appear than to appear. Right. So we basically recognizing the financial framework and the tight management and reporting of our reserves that we discussed at this board, we wanted to ensure also that all risks are disclosed. And we took a very conservative approach here. That's why there was more visible and was more subject to the Board of Auditors comments in this regard.

So we're kind of proud of having this more transparency. So I don't hope you shoot the messenger but it's like at this point I think it was important to bring this to your attention. In the context of our environment we recognize the mismanagement of Project A. Project A was a almost decade year old effort. So it was something we brought to your attention right now.

And particularly the contingent liabilities which we don't know if they come to bear or if they come but we wanted to highlight this. So it's something that was long persisting and we improved particularly the management of Project A and the country office that manages Project A by deliberately posting their additional resources, getting extreme internal expertise to manage basically the salvage of this project and also agree with the Member States on the contingent liabilities and the recognition of those expenses and bring that to closure. So that was a very high profile and we of course, expand these efforts across all of UNOP's efforts around all projects around the world. Liquid excess reserves. I just want to say we introduced the new methodology and we are proud of managing this because this is very tightly scrutinized and reviewed by the Board.

And finally, we have more guidance for direct contract exceptions for procurement and hope that this will reduce the number of direct contracting exceptions. Thank you.

Thank you very much. And now we go to uncdf. Thank you.

To the question from the United States, as far as the 2023 recommendations are concerned, UNCDF has implemented all of them. Six of them have been closed, three are in the process of being closed by the Board of Auditors. So we are awaiting feedback from the Board of Auditors so that if there's anything further that needs to be done, we'll do it. If not, hopefully we can close those out as well. Well, for the 2024 recommendations, nine recommendations, two are due to be closed in quarter one of 2026, one to be closed in quarter two of 2026, and the remainder by quarter three in 2026, as per the schedule that was provided at the time.

As for the question or comment on cooperation with other UN entities, indeed this is something that is at the heart of the new strategic framework that builds on examples of support that we have provided to UNICEF to deploy concessional finance in Nigeria to increase RUTF packages for malnutrition related initiatives with UNDP in Kenya to try and crowd in private capital for developers of cold chain storage to reduce food waste with UN women, UNFPA and others where we are working on different programs to crowd in catalytic capital to support development outcomes. That is at the heart of the new strategic framework. UNCDF will really become essentially a power that all UN agencies will be able to use to do more than what they otherwise would be able to do do themselves. Given the unique financial rules and regulations that UNCDF can work with in the deployment of these financial instruments, we think this is critical, particularly at this time where there's scarce ODA and we're all looking for ways in which to stretch the value of every dollar that we can provide for development assistance. And that's a corporate conversation we're having with all UN agencies with separate programs of assistance now being articulated.

I just finished one with UN Habitat last week with UNDP and several res reps, etc. So that will certainly be done in the course of year as we implement our new strategic framework. Thank you.

Thank you very much. I thank each of the Representatives that have made their responses.

We did not get a question directly to the Board of Auditors, but nonetheless we get give them an opportunity to make a comment. Thank you.

Thank you, Mr. Chair. Indeed, most of the questions were directed to the administration.

But my colleagues, I'm sure may want to elaborate further on your notes. And before that I will hand over to you Mr. Chi. Before that I wanted to maybe elaborate on one question about the main challenges that are raised by the shared service. And it's a very important question which makes sense and in the context of research of cooperation and efficiency gains as a focus area of the unity process. This is why we decided to revisit the question in a further audit on UNDP later in the future.

And as you know, as recognized in the UNDP program and operation policies and procedure, UNDP has an underlying responsibility to provide services to the UN community on request by a UN agency. Some figures that are in the report. At the end of 2024, UNDP provided services to 70 entities. The main services provided by UNDP to those institutions related to human resources. More than 50,000 pay slips per month.

Public procurement for 2.6 billion in 170 countries. Finance 1.6 billion in financial transactions and 7 billion in cash management. Also in real estate management of shared premises in 130 countries and it 40,000 users. This shows the importance of the shared service for UNDP and for the UN community. And in order to encourage this process, the Board highlighted three factors that could contribute to the development of the UNDP function.

It's a matter first of internal control. UNDP could reinforce internal control and I just give an example. But the list of agreements signed by UNDP did not appear to be systematically updated. And I am sure that UNDP is working on that. Second, when you provide a service, you have to care with clients.

And the satisfactory monitoring process was still in an early stage when we implemented this audit. So it's also a matter for further follow up. And third, strategy. While UNDP's commitment to the UN Secretary General Efficiency strategy is reflected in numerous concrete action, it has not been translated into a formalized strategy and therefore did not result in the definition of objectives, target and roadmap for this strategy of developing shared service. Those are the main challenges that were identified by the Board of auditors.

Thank you, Mr. Ji. Maybe you want to develop briefly.

Thank you, Chair. And I just would like to supplement two points on two key issues raised by your distinguished delegates of Nazi and also US. First, on the S3I projects and also infrastructure construction Projects actually, as you have correctly pointed out that we really identify some key deficiencies in relation to the project governance construction.

Project governance to be specific in this case. And we welcome the replacing replacement by POC over EAC Engagement Acceptance Committee for EAC which is more focused on procurement and contract management. And now POC has been elevated to a more let's say governance level to encounter to composing nearly high Deputy Ed or some other senior managers in this oversight committee. And there is two points we would like to highlight. The first is that we would like this POC new established POC to cover the whole life of all those projects including the development, approval, monitoring, implementation and the reporting and closure process.

So to identify those key risks and also to mitigate them by taking remedial actions in immediately once they are identified. And the second point we would like to point out is that while we noting these deficiencies, we know that actually there is a policy framework and the requirement or guidelines in those areas like the project management. While the problem is more with the second line of defense, I mean the monitoring and the control, whether they are implemented or whether those requirements set up in the policy framework has been well observed or followed. That is a key issue. I think that is an area where we really believe that the second line of defence needs to be strengthened by the administration.

And the second point that we would like to make is relating to the liquid excess reserve. And as we have reported in the 2024 financial year auditor report we noted that the PPE and the inventory has been double counted in calculating the net assets, thus underestimating the excessive reserve by around 30 million. And we believe that this kind of methodology after being temporary approved by the Executive Board and this kind of methodology needs further refinement. And the board are going to continue this review of the rationale and sufficiency of this methodology and may come back if any findings identified in 2025 audit. And for the last point mentioned by your distinguished delegated by us, the directed contracting.

Actually that is a recurring weakness as we have reported in the past. And also that is one of the area that the client has indicated some unsatisfaction toward the service. And also in this area we do see that some procurement guidelines or requirements has not been complied with during the procurement process. And some like some insufficient justification for this direct contracting are not that convincing. So we are very happy that the administration has taken some very proactive measures in this regard, especially in relation to the emergency procurement process.

And we'll be reviewing these actions taken. And also we are going to keep all these key weakness areas in our 2025 financial audit year review which is going to be conducted in April this year. Thank you very much. Thank you Mr. Chair.

And to finish Mr. Wanderley on UNFP.

Thank you. Mr. Chair is just to mention two points that were addressed by the distinguished delegate from the Netherlands. The first one about the supply chain management unit of unfpa.

Just to say that I fully agree with what was mentioned by the admin that the problems were mainly due to the realignment of the restructuring of the unit. So with the delayed establishment of the governance and risk compliance model, we understand that this delay caused this situation of the weaknesses that we don't have good indicators. Incomplete process mapping and lack of operational integration of UNFPA enterprise risk managed policy with the policy the enterprise. So in this regard, what the Board recommend was to create unit risk and oversight model aligned to the enterprise risk management, mapping the assess the unit process tools and formalizing the lead time management through better coordination and reliable indicators. I'm glad to know that the ADMIN has taken actions about that and we are going to do an audit in UNFPA next April.

And you check if this these actions fulfill all the requirements that we understand that needs to be done. In this regard, the second point that was raised the weaknesses in donor agreement and the main causes of that. We have some weaknesses in tracking and documentation, impaired traceability and increase the risk of misclassification. We didn't find any problems in this regarding any misclassification. But the problems in the documentation could lead to this kind of problems and hinder key internal controls processes including reconciliations, documents retrieval and financial validation.

So in this case the Board recommend stricter documentation compliance and the comprehensive reconciliation with periodic data integrity reviews. And in this regard we found that many documents were missing, many annexes were not found in the system. So we were going to follow up this recommendation in the next audit also. Thank you, Mr. Chair.

Thank you very much. I thank the representatives of the Board of Auditors. I now wish to inform that we are concluding this brings us to the conclusion of agenda item number two in terms of the action for the Executive Board. I wish to inform the Board that a draft decision on agenda item number two on the recommendations of the Board of Auditors is under preparation and will be presented for the Board's consideration later in this session.

For now we allowed for a change of podium just a few minutes. Thank you very much.

That.

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Problem. You're still in where you were. You're still where you.

Thank you. Very much for your patience. We now continue to the next agenda item, which is agenda item 5 for today on Risk management. We will now continue the joint segment with agenda item 5, risk management. This is under item UNDP.

UNFPA and UNOPS will provide updates on enterprise risk management and critical risks of strategic importance. I am pleased to welcome to the podium. Some of them are coming back.

Assistant Administrator and Chief Risk Officer, UNDP Mr. Andrew Saberton, Deputy Executive Director, UNFPA Carl Ludwig Soh, Chief Financial Officer, UNOPS. And also joining us on the podium are Linda McGuire, Assistant Administrator and Director, Bureau of Management Services, UNDP Mr. Samuel Schoritz, Chief of Staff and Chief Risk Officer, UNFPA. I now give the floor to Hao Liang. The floor is yours.

Thank you very much, Mr.

Chair. Your Excellencies, Board members, colleagues. Risk management is fundamental to how UNDP delivers on its commitments to Member States and to the people we serve. It enables us to operate in the world's most challenging contexts. It helps us anticipate future scenarios and adjust our strategies accordingly.

And it ensures we remain agile, accountable and anticipatory. Under the HL CM risk maturity model, the NDP's has achieved an advanced rating overall. This reflects mature policies, robust frameworks and integrated tools across all three lines of defense. From implementation through oversight to independent assurances. Our enterprise Risk management system is embedded in in the design and delivery of UNDP's new strategic plan.

Strategic foresight informs decision making at the highest levels, ensuring we continuously adapt to the evolving development landscape. In 2022, we strengthened UNDP's stakeholder response mechanism, a critical option for project affected communities to raise concerns and seek resolution to grievances. This reinforces our commitment to accountability and to upholding our social and environmental standards. Looking ahead to 2026, we will deepen our organizational risk culture and build staff capacity on enterprise risk management. We will also deploy AI driven analytics to enhance risk identification and provide targeted support to high priority projects.

Mr. Chair, let me now turn to the six critical risks we are presenting to the Board. First, financial sustainability under pressure, Declining coal resources and constrained fiscal space threaten our ability to mobilize sufficient funding. Without adequate resources, we risk losing organizational agility, human capacity and our universal presence. Our mitigation strategy includes building flexibilities in the Integrated Resource Plan and integrated budget.

Continued business model enhancements and engagement with Member States through structured funding dialogue and the Funding Compact. Second, reputational harm from fraud, misconduct and the safeguard violations Incidents involve fraud, sexual exploitation and abuse or non compliance with social and environmental standards can severely damage partner trust and violate our core values. We maintain robust financial regulations, internal controls and comprehensive risk assessment tools. Our independent evaluation, audit and investigation functions provide essential third line oversight and we continue to strengthen staff and partner awareness of our responsibilities. Third, Escalating crisis and Climate Disasters the increasing frequency and the severity of crisis and climate events strengthen our capacity to maintain universal presence and deliver in the contexts where we are needed most.

We are investing in security infrastructure, regularly updating business continuity plans and implementing the UN security risk management process. However, sustaining operations in these environments requires adequate and predictable resources. Fourth, technological threats, including cybersecurity and AI driven misinformation, cyber attacks and AI enabled misinformation threaten both our internal systems and the development results we pursue with partners. Data breaches can compromise sensitive information and erode trust. We have updated our information security policies based on international best practices, implemented data protection impact assessments and are developing comprehensive training and standard operating procedures.

Fifth, Unity Reforms without adequate mandate.

UNDP may be asked to assume expanded operational responsibilities under UN 80 reforms without mandate clarity or financial resourcing. This could expose UNDP to operational, reputational and fiduciary risk. We are addressing this by engaging in the UN 80 work packages and advocating for apologies. We are addressing this by engaging in the UNITY work packages and advancing and advocating for a sequenced, mandate driven approach anchored in Member States guidance. Any expanded role will be governed by fully costed interagency agreements based on structured capacity assessment.

Sixth and last Declining confidence in multilateralism, growing skepticism towards multilateral Systems threatens the UN's legitimacy and influence, potentially reducing engagement and funding for NDP. Our response is to demonstrate tangible value through quality protection programming, maintaining the highest transparency standards and engaging strategically with both traditional and emerging partners to rebuild trust. In closing, Mr. Chair, Risk Management is not a compromise exercise. It is a strategic function that enables the NDP to deliver results where it matters most.

By continuously strengthening our risk culture, our systems and our people's capabilities, we ensure UNDP remains resilient, adaptive and accountable to Member States and the communities we serve. Thank you very much for your attention. Thank you very much, Mr. Xu, for your presentation. We now transition to UNFPA. Andrew, you have the floor.

Thank you. Thank you, Mr. President, distinguished members of the Executive Board, I'm pleased to present UNFPA's update on enterprise risk management and our principal risks of strategic importance as mandated by decisions 20241 and 2025. 3. This statement is anchored in the 2025 Joint Information Note prepared alongside UNDP and UNOPS to ensure the transparency and comparability requested by this Board as we launch the 20262029 strategic plan. Erm is evolving from a commercial compliance function into a strategic driver of organizational resilience.

It is helping ensure our outcomes. Those outcomes, from ending preventable maternal deaths to adapting to demographic change, are pursued with rigorous oversight. In an increasing volatile global landscape, we are currently navigating a range of risks funding volatility, geopolitical instability and concerted political pushback against our mandate. In some quarters we are actively reviewing opportunities and risks associated with the UN 80 initiative and we will keep the Board informed as these involve an achievement in 2025 is the modernization of our digital ecosystem. We are replacing the legacy Myrisk system with a data driven ERM application deeply integrated with with our Quantum plus erp.

This will allow us for the first time to map identified risks directly to strategic plan outcomes and to utilise real time key risk indicators to validate assessments with objective evidence. This progress is reflected in our 2025 maturity self assessment. While not explicitly requested this year, we still conducted the review using the HLCM Reference Maturity Model to ensure comparability with our sister agencies and I'm proud to report the UNFPA has moved from established towards advanced maturity across all six dimensions. Most notably, our systems and tools capability saw the most significant advancement reflecting our strategic transition from basic data collection towards a modern data driven oversight architecture. Furthermore, we achieved a 100% completion and validation rate for our annual organisational risk assessments across over 130 business units, signaling a profound shift towards a proactive risk culture.

We also continue to strengthen oversight of our 1600 implementing partners through our robust assurance framework. Our composite risk model incorporates materiality and past performance to ensure that audits and spot checks are proportional to actual risk risk. Our risk appetite remains a dynamic tool in humanitarian settings. We have operationalized and no regrets approach empowering swift life saving action while maintaining clear accountability through formal escalation and senior level oversight. Regarding our principal risks, UNFPA has identified seven areas requiring constant vigilance.

The most immediate is sustained underfunding which we are mitigating through donor diversification and internal efficiencies. We are equally focused on the strategic uncertainty arising from UN reforms. As discussed in our informal session, we are managing the risks of the UN80 process through proactive engagement and rigorous analysis on potential impacts on mandate delivery. In the coming cycle we commit to the regular review of core ERM policies, the full deployment of our digital monitoring tools and the development of a methodology to measure organisational culture as a Formal risk control. In conclusion, UNFPA has moved beyond framework establishment to the functional integration of risk management into our strategic DNA.

We remain dedicated to building a resilient, transparent and risk informed organization ready to meet the challenges of the future. Thank you and I look forward to your questions. Thank you, Mr. President.

Thank you very much. We now move to UNOPS.

Carl, you have the floor now for your presentation.

Mr. Chair, distinguished members of the Executive Board, I welcome this opportunity to brief you on how UNOPS has enhanced risk management to better serve our partners. I will also provide an update on UNOPS critical risk in and our actions to mitigate their impact. First, allow me to share what is driving UNOP's efforts on this matter.

Risk management was an important element of the comprehensive response plan in which we have achieved substantial progress, but long term action is required. We are strongly committed to enhancing risk management above and beyond the crp. Looking at the presentation, recent events show how quickly the outlook can change. We have worked to ensure that risk management at UNOPS remains contextual, dynamic and principle based because this approach allows us to more effectively overcome new and enduring implementation challenges towards the future. Guided by a new strategic plan, UNOPS is determined to scale up and speed up delivery.

Once more robust risk management will be crucial to succeeding in this context. UNOPS has performed several improvements to its enterprise risk management at the corporate level. We developed a dedicated mechanism to assess our most critical risk streamline our corporate risk metrics to more promptly detect warning signs and every quarter we thoroughly analyze our performance to uncover potential risks affecting the entire organization in the field. We conducted reviews of specific portfolios to improve oversight and responsiveness across our delivery established a portfolio oversight committee to strengthen decision making on high stake engagements and enhance our accountability framework to underpin ethical decision making and our overall risk culture. A key initiative I would like to highlight is our work towards institutionalizing UNOP's risk appetite.

We favor risk reduction over avoidance, customized mitigation over uniform measures and principles over procedures. This enables us to deliver where the needs are greatest and why. Our risk appetite is centered on engagement rather than on individual risks. Independent of context, our decisions have been and will continue to be governed by UN values, our mandate and our policies to support responsible risk taking. We are institutionalizing decision principles and more formally defining our boundaries.

I am pleased to report that these and previous improvements have paid off. Our self assessment against the risk management maturity model indicates that UNOPS has achieved a level of fully established. However, our continued efforts are now moving towards an advanced maturity level. As team members, the outlook has changed considerably since our last update on critical risks. First, heightened uncertainty may affect our workplace culture and our people's morale.

To maintain a thriving environment, we offer confidential counseling and flexible work options. Second, our reputation is strong and our delivery is robust. But we are not exempt from the challenges facing multilateralism. To minimize financial and political exposure, we are exploring new areas of growth, engaging with non traditional partners and leveraging our implementation mandate. Third, the UN reform process may increase demand for services in which we specialize and it may weaken elsewhere.

We are preparing for either scenario by mapping efficiency needs across the UN system and developing alternative plans to quickly re optimize our operations accordingly. Finally, to maneuver around our limited margin for investments, we preemptively reduced cost. But we are also preparing to meet the future implementation needs by nurturing our talent. We streamlined our workforce development strategy, launched a new recruiting platform and are developing new HR services to meet our partners emerging needs. Honorable Members of the Executive Board, UNOPS has achieved a lot, but we are not done.

Risk management requires dynamism and foresight. Our approach leverages tools we have as well management team leadership and independent assessment. I want to assure you that strong risk management remains at the top priority for unobs. Thank you for your time and attention. Thank you very much, Mr.

So for your presentation. Ladies and ladies and gentlemen. Gentlemen, I now open the floor for comments and questions.

I do want to recognize the distinguished representative from Rwanda speaking on behalf of the Africa Group. Your Excellency, the floor is yours. Thank you, Mr. President, distinguished members of the Executive Board, Excellencies, distinguished delegates, I have the honor to deliver these remarks on behalf of the African Group members of the Executive Board Board, namely Chad, Cote d', Ivoire, Madagascar, Mozambique, Nigeria, Tunisia, Zambia and my own country, Rwanda. We wish to thank the Administrator and his team for the joint information note on enterprise risk management and principal risks of strategic importance prepared in response to Executive Board decisions. We also appreciate the transparency provided by and the continued efforts to strengthen risk informed management across the UN development system.

From the perspective of Africa, risk is not an abstract concept. It is a daily reality shaped by financial volatility, climate shocks, fragility and uncertainty. Yet it is precisely in these contexts that the United nations is most needed. Effective risk management, therefore, must do more than protect institutions from exposure. It must enable them to remain present, responsive, credible and with the ability to deliver results where development challenges are most acute.

The African Group recognizes the progress made in strengthening enterprise risk management frameworks, including greater coherence, improved data use and clearer governance arrangements. These efforts are necessary at the same time, we believe that risk management must be applied with discernment when driven primarily by financial pressure or system wide reform imperatives. Risk mitigation approaches can unintentionally narrow operational space or weaken delivery capacity, particularly at the country level. For African countries, the central question is balance. Risk management should help the system take informed and responsible risks in pursuit of development outcomes, not retreat from engagement.

It should protect the fiduciary integrity and accountability while also safeguarding mandates, institutional memory and national ownership. In this regard, clarity of roles, mandates and results remain essential to sustaining confidence among Member States and partners alike. The African Group further emphasizes the importance of clarity of mandates, clarity of roles and clarity of results. These elements are essential to maintaining confidence among Member States and to ensuring that risk management serves as an enabler of delivery rather than an end in itself. In closing, Mr.

Chair, the African Group approaches this agenda item in a constructive spirit. We remain committed to strengthening enterprise risk management as a tool that supports reform, resilience and results. We look forward to continued engagement with organizations to ensure that risk management frameworks reflect the realities of programs, program countries and enable the United nations development system to deliver where it matters Most. Thank you, Mr. President.

I thank the Permanent Representative of Rwanda for his statement.

I now recognize the distinguished representative of the United Kingdom on behalf of a group of countries UK you have the floor.

Mr. President, I deliver this statement on behalf of Australia, Belgium, Canada, Denmark, Finland, France, Germany, Iceland, Ireland, Japan, Luxembourg, the Kingdom of the Netherlands, Norway, Sweden, Switzerland and my own country, the United Kingdom. We welcome the update on enterprise risk management presented by undp, UNFPA and UNOPS and the aligned structure of this year's report. We recognize the continued efforts of all three organizations to strengthen risk management practices and enhance internal controls in support of their mandates and strategic plans. First, we recognize the progress made by UNDP in embedding risk management across bureaus, country offices, projects and corporate levels. We welcome the more mature ERM system and the integration of risk considerations into country program design, performance, management and oversight mechanisms.

We encourage UNDP to continue strengthening the link between risk information and strategic decision making, including through clear risk ownership, consistent application across country offices and timely escalation of high level risks. Second, we commend the UNFPA's efforts to improve risk management across its humanitarian and development operations reflected in the updates on strategic and enterprise risk management provided to the Board. This is critically needed as global crises deepen and as women and girls bear a disproportionate burden of conflict, displacement and climate related shocks. As UNFPA continues to operate in complex settings, we encourage further focus on residual risk analysis, mitigation planning and strengthened assurance oversight across implementing partners. Third, regarding unops, we note the ongoing efforts to institutionalise reforms and appreciate the commitment to risk governance.

We acknowledge the enhanced accountability framework and other recent updates including the introduction of the Portfolio Oversight Committee and the Strategic Portfolio Committee. Sustained cultural changes supported by accountability, staff training and leadership engagement remains essential across all three organizations. We underline three cross cutting priorities. First, risk appetite and tolerance. Clear operationalized risk appetite statements are essential for ensuring consistent decision making, particularly in high risk contexts such as fragile and conflict affected settings or complex procurement environments.

Second, risk culture and accountability A strong organization wide risk culture with risk informed decision making is foundational. All personnel have a responsibility to identify, communicate and manage risks. We encourage undp, UNFPA and UNOPS to continue promoting openness, staff confidence in raising concerns and management accountability at all levels. Third, data controls and assurance robust systems for monitoring, verifying and reporting risks supported by audit, evaluation and external oversight functions are critical to safeguarding resources and maintaining the trust of Member States. In addition, we underscore the importance of ensuring that current and new risks related to UN80 initiatives, as well as the backsliding on gender equality and SRHR are integrated into future enterprise risk management reporting.

Could the organizations explain how UN 80 related risks, including material changes in risk assessments, mitigation measures and residual risk exposure, will be systematically integrated and reported to the Executive Board? Finally, we reaffirm our commitment to supporting effective, transparent and accountable multilateral development organizations. Strong enterprise risk management is essential to ensuring that programs deliver sustainable results for those they are intended to serve, particularly in the world's most challenging context. We thank undp, unfp, and UNOPS for their continued engagement with the Executive Board and look forward to ongoing dialogue on this important agenda item. Thank you.

I thank the distinguished representative of the United Kingdom. Ladies and gentlemen, the floor remains open. Just checking before I get back to the presenters if there's any requests for the floor.

I see none and therefore we get back to the presenters. We'll start with Mr. Hur.

Thank you very much, Mr. Chair. Thank you very much, Ambassador Ngoka, for your comments.

On behalf of the African Group, I think your central point is that risk management is for a purpose that is to ensure that we achieve development results, not retreat from the risks. So I think the point is exactly what guides UNDP's approach to risk management. So we fully agree with you. We will definitely use risk management to help us achieve results despite the challenges in Fact, last year we amended our risk management strategy to incorporate risk as part of achieving results. So I think so we're now combining results management and risk management in the same, in the same process.

So I think we definitely agree with you on this and then on the UK's comment on behalf of a group of countries, thank you for recognizing the progress the NTP has made in enterprise risk management and we indeed take this very seriously at all levels of our business units. And I agree with you that we needed to make sure that the link between risk information and decision making is clear and scientific and is effective. So I think this is exactly what we have tried to do and we will focus on this further. We have different kinds of dashboards. For example, we have a performance app to look at accountability issues at the executive level.

And at this time we're also looking at, I personally myself working with Linda and our colleagues are looking at how we can improve these kind of different systems so that we can use GIS and AI technology to develop more effective executive information decision making system. So we're looking at this very carefully. We do have a system of escalation and business units at a lower level can escalate risk once they cannot manage it and then we can escalate and make decisions to see if we take the risk or not in order to achieve development results. Some of the cross cutting issues you mentioned and yes, agree fully. We needed to be very clear about our risk appetite, appetite and risk tolerance.

I think NDP's risk appetite statement is sophisticated. I would say it depends on different situations. We have different levels of tolerance. We're constantly reviewing this and we welcome your guidance on this risk culture and accountability. I think again we take this very seriously in our financial rules, regulations, our staff rules and regulations in our accountability system.

This all spelled out very clearly. We have Office of Audit and Investigation to help us ensure accountability and I in my role as Associate Administrator I do review and assign off disciplinary cases. Unfortunately that I can tell you we don't tolerate any violation of asset and the financial and other compliance rules and regulations and our management is very open to signs or signals of issues and challenges, frauds or any other problems we may face. We have a strong and whistleblower policy and protection and we always encourage staff. To.

Put forward any concerns they have or any concerns about any wrongdoings to our Ethics office or to Office of Audit and Investigation. So we agree with you on this. This is critical for your trust to entrust your resources and for us to provide effective support to our Member states and I think data control and assurance I think is related to this information right to decision making process. We all agree on UN 80 last point. We're undertaking review of UN 80 related risks for every work package we're involved in.

And once we have assessment of that, if there's needed to escalate.

Thank you very much. Now UNFPA. Thank you Mr. President. Let me first respond to remarks by Rwanda on behalf of the Africa Group. We use risk management to make risk informed decisions.

We never use risk management to walk away from any process.

Basically risk management is about the enabling of delivery, not about avoiding risk. It's about mitigating the risk and it's not about ignoring the risk and exposing donors money to unprecedented situations. There are several tools in our toolbox in UNFPA which could emphasize this but a couple of examples are no regrets policy for humanitarian engagement. We're in there already straight away with certain monetary limits the moment a scale up is declared. And also again within the humanitarian reset our promise to be in our role as a provider of last resort for gender based violence in humanitarian settings.

So we'll be there. We're not going to walk away. And the reason why we can do that and manage the situation is of course we do have a risk appetite statement which enables us to adjust level of risk and put various mitigations in to enable us to adapt to the various circumstances we find ourselves working in. In some comments in response to the UK we have moved certainly at UNFPA from 201617 when we introduced the our first enterprise risk management process and system. We have really gone a long way and moved away from a ticket box exercise.

Risk management is now part of every manager's job and every day they're using risk management in every decision that has that has evolved. And you've heard some things in our risk management informal last week of where we've evolved in terms of automated systems, in terms of roles, in terms of the risk management policy, the creation of the chief risk officer, the actual now creation and establishment of risk committees both at headquarters and at regional level. So any piece of work we're doing, any situation, we find that where we have to adjust our risk appetite statement. If there's decisions that need to be escalated, they can be essentially escalated in real time. And currently we are looking at, I've mentioned the no regrets policy as one area where we have this more adaptive risk management.

Coming back to another point you made and just to react that we have included in the integrated budget and the strategic plan that you endorsed last September. We have included, this time, for the first time for a very, very long time, resources for the strengthening of the second line of defence. This is linked directly to the risk management discussion we just previously had. But this is important. Over the years we've invested widely in independent audit services, be it our internal oversight or the board of auditors.

We've never invested. We've fallen behind on the investment in the second line of defence. We need to stop these problems from occurring in the first place, let alone, as opposed to building up the resources to actually find them. The Risk Appetite Statement is an annex to our enterprise risk management policy. So it's on our public website.

It is going through a mandatory revision this year and we will update it and specifically link it to much more to our humanitarian work and the emergency policies and procedures which were actually launched last year as another evolution of our humanitarian work. Risk culture and accountability yes, we're making risk management part of everybody's job and we realize that culture is often far more effective than strategy here. And one of the you'll hear about late this session later this week. One of the things we've now integrated our organizational risk culture work, which was a project based work now as part of our humanitarian, sorry, our human resources division. So it's actually part of our everyday working environment to build up and improve those skills.

We're going through a considerable amount of investment in dashboards, report systems and including the use of AI to also manage this risk environment culture that includes IPs as well as other things on the UN80 at this moment and many of you are at the session this morning just to say we have put together, we have provided inputs together with UN women to the consultants who are advising the steering committee on a risk log. The risks that should be considered. These were risks that we went through last week in UN80 informal, the main risks there. And of course as the Deputy Secretary General promised this morning, that report will probably be shared.

Sorry, that report will be shared. That assessment report is to be shared in February and probably earlier than the other merger that was in discuss thereafter we'll see whatever the decision is, we'll have to manage the risks around it. But a classic example to look at we now, and we put it in our information note, we have specific risk logs for all major projects that the organisations go on. The clearest one on that is on the recently completed Headquarter optimisation project where you remember we shared a risk log with the Executive Board and it became a standing agenda item internally on our fortnightly senior management meetings of that project, right the way from its inception to the actual completion of that project where you received the last update last year. I have no reason to suspect we will differ from that kind of methodology in any major project going forward.

Thank you very much, Mr. President.

Thank you very much. And now we go to UN Ops. The floor is yours.

Yeah, I mean with respect to the question that was raised by the distinguished delegates from Rwanda.

Yes, we as an engagement driven field oriented organization, we very much agreed to to your statement. So it's like we want to achieve a balance to enable delivery while managing those risks. And we are very, very invested in fragile environments and we recognize those risks in order for the risk management of each of these engagements. We believe we will achieve this by continuing to decentralize decision making, reinforcing a responsible risk taking culture and enhancing accountability. So to that end, among other initiatives, we will activate a roster of risk management advisor to support field operations and scale up training for colleagues on the field.

But this is a complex environment and as my colleagues just stated, it's not a reason to withdraw from certain environments, but rather a assess risks related to the engagement that we have in these environments. With respect to the questions from the distinguished delegate from the United Kingdom, we appreciate praise for our ongoing efforts and establishing stronger accountability and sustained cultural change. With respect to the cross cutting. Cross cutting topics, I couldn't agree more. I think all my colleagues already agreed on this one.

So risk appetite and tolerance is key. So we institutionalizing a corporate risk appetite model to guide engagement, acceptance, escalation, portfolio balancing, particularly in the high risk context. And for us it's one project at a time that has to work in the portfolio and be managed in that regard. As was said before, risk culture and accountability is much more powerful than risk strategy. And we are very aware of this and want to implement this particularly also through the PoC, but also to the guidance that's related to the field.

Finally, data controls and assurance is a key point. It's something that is related to also the BOA recommendations that we talked about in the previous session. Because it's the engagement risk that is basically materializing here. And we can only do this for our entire portfolio through data controls and assurance efforts. Finally, current and new risk related to UN80.

That's a very good question. It's actually a very prominent question right now because UN80 and the discussion of UN80 has had an impact on our donor base. Who asking as Executive Director stated, is UNOPS there next year or Can I sign a contract with you? Is a prominent question. And it's the same thing on our talent acquisition and personnel level.

So it's very important that the uncertainty about this process is mitigated in a very fast measure. I mean, I've been in private sector before, and a merger is something that is not extensively discussed. It's basically announced and then executed. Right? This period of uncertainty, perhaps particularly for us, as UNOPS is a fee for service organization, project by project, without core funding.

We have to convince each of our donors to sign a new project. And the uncertainty is something that's on their mind and is very clearly stated by them. I think with this I want to conclude. Thank you. Thank you very much to all the presenters and thank you very much to each one of you for your attention and for interventions.

Ladies and gentlemen, this concludes the consideration of agenda item 5 as regards the Board action. I wish to inform the Board that a draft decision on the agenda item 5 on risk management is under consideration and will be presented for the Board's consideration later in this session.

So we take a moment for change of the podium and I thank the colleagues who are here for their presentations. Thank you, sir, so much.

It.

Sa.

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Thank you very much, ladies and gentlemen.

If we just take our seats. Thank you.

So we now proceed to agenda item four, update on the assessment of how the Executive Board executes its governance and oversight functions. I'm pleased to welcome to the podium a representative of the Joint Working Group of the Executive Boards of undp, unfpa, UN ops, UNICEF and UN Women on the governance and oversight functions of the executive boards. Mr. Nikolai Khomakov, permanent Mission of the Russian Federation to the United Nations. Welcome. I now give the floor to Mr. Komakov for his presentation on behalf of the Joint Working Group.

You have the floor.

Thank you, Mr. President. Distinguished members of the Executive Board. Dear colleagues, allow me to begin by recalling that the Joint Working Group was mandated to study and report on the recommendations contained in the JRU report and to develop actionable strategies for their implementation where appropriate and necessary, with a view to strengthening governance and oversight across the participating Executive boards at the second regular session of 2025. The boards further requested the Joint Working Group to deliver on its mandate in accordance with the approved roadmap and without delay, and to present timely and concrete proposals for the consideration of the Boards as appropriate. The Boards also encouraged the Working Group to take into account developments and reform proposals emanating from the UNAT initiative with a view to ensuring synergies since the Previous Update the Joint Working Group has entered an active and substantive phase of its work.

During this period, the Group has continued its analysis of both formal and informal recommendations contained in the GRU Report. In particular, with regard to the Recommendation four on standing committees, the Group conducted desk research on existing practices in multilateral organizations with a specific focus on the UN system, where the establishment of subcommittees was explicitly referenced in the GRU report. Based on this analytical work, the Joint Working Group circulated two batches of questionnaires to the agencies. The first batch focused specifically on the recommendation related to standing committees, while the second batch covered the remaining recommendations. With regard to the first questionnaire, the Joint Working Group received responses from 12 units across UNDP, UNFP, UNOPS, UNICEF, and UN Women.

The responses were detailed, thoughtful, and substantive, and the Group would like to express its appreciation to the agencies for their constructive engagement. The Group has begun analyzing these responses to inform its further deliberations while the analysis is ongoing. The preliminary assessment indicates a number of common themes emerging from the Agency's input. In general, agencies acknowledge that in principle, the establishment of subcommittees could allow for a more expert, detailed and thorough examination of audit, risk, finance and budget matters at Board level. At the same time, agencies consistently underline important concerns and constraints, including the risk of duplication with existing oversight mechanisms, the need for clear mandates and appropriate sequencing, as well as resource and servicing implications.

The potential added value of any such agreement is therefore widely seen as contingent on careful design and alignment with existing frameworks. To further inform its work, the Joint Working Group intends to hold targeted interviews with specific units within the agencies and as well with the WFP Executive Board, which operates with Standing Committee arrangements. These exchanges will aim to explore practical ways to address concerns and bottlenecks identified in the responses before the Group formulates any proposals for consideration of the Executive Boards. Turning to the second batch of questionnaires, these were addressed to secretariats of the Executive Boards and circulated on 12th of December 2025 with an initial deadline of 15th January 2026. The Secretariat subsequently informed the Group that they would be unable to meet the timeline due to their intensive engagement in the unity process as well as preparation for the first regular sessions.

In this context, the Joint Working Group agreed to the proposal that responses to the second batch of questionnaires be submitted by 28 February 2026, and the group noted the importance of strict adherence to this new deadline in order to allow the work plan to proceed as scheduled. As regards the work plan for 2026, the Joint Working Group intends to Present initial preliminary observations and possible directions at the annual session of 2026 for consultations and feedback from the Executive Boards. The Group then aims to submit this report at the second regular sessions of 2026 for the board's consideration and any subsequent action as deemed appropriate. Should any adjustment to this timeline become necessary, the Joint Working Group will inform the Boards accordingly and in a timely manner. Mr. President, distinguished members, the Joint Working Group remains fully committed to delivering on its mandate in a transparent, inclusive and timely manner and looks forward to continued engagement with the existing Executive Boards as the work progresses.

Thank you. I thank the distinguished representative from the Russian Federation. Thank you, Mr. Kopov. I now open the floor for comments and questions. The floor is now open.

I now recognize the distinguished representative from Zambia speaking on behalf of Africa Group.

On behalf of the African members of the Executive Board, we note the update on the assessment of how the Executive Board executes its final functions on governance and oversight. We note the need to continually improve the governance and oversight functions in line with the best practices outlined in the report of the Joint Inspection Unit with a view to ensuring that this Board is even more effective in undertaking its role. In this regard, we commend the progress made so far in implementing the recommendations of the Joint Inspection Unit. We further call for acceleration in the actualization of the following recommendations. Firstly, the appointment and designation of Committees, including with respect to budget, finance and oversight, will improve the efficiency and effectiveness of the Board in analyzing, reviewing and decision making pertaining to these important matters.

We recognize that this may invariably lead to additional responsibilities for some members and may result in additional costs for the Secretariat. However, we believe that this will help the Board in effectively deliberating on these matters. We therefore welcome a proposal on the cost implementations of actualizing this. Secondly, we underscore the need to strengthen a self assessment mechanism in order to embed a culture of continuous improvement in subsequent convenings and engagements of the Executive Board. This is particularly important in view of the entry and exit of some Board members on an annual basis.

Thirdly, in relation to entry and exit of members of the Executive Board, we welcome the onboarding and orientation processes held at the start of the Board calendar for the year. We further encourage continuous learning for Board members with respect to their different roles. This should not only be with respect to its fiduciary responsibilities, but also in relation to oversight over the implementation of the strategies of the three agencies. Lastly, Mr. President, we welcome documentation that will highlight, in summary, a review of the practicality and implementation of the recommendations and decisions relating to this agenda item during the next session it will be tabled. The Group of African countries in the Executive Board remains committed to supporting efforts towards enhancing the effectiveness of the Executive Board in undertaking its governance and oversight functions.

I thank you. I thank the distinguished representative from Zambia and now give the floor to the distinguished representative from the United Kingdom speaking on behalf of a group of countries.

Mr. President, distinguished members of the Executive Board, I present the statement on behalf of Australia, Belgium, Canada, Denmark, Finland, Germany, Iceland, Ireland, Japan, the Kingdom of the Netherlands, Luxembourg, New Zealand, Norway, Sweden, Switzerland, Turkey and the United Kingdom. We thank the Joint Working Group for the update and would like to express our appreciation to all its members for the time and commitment they continue to invest in advancing this important process on behalf of the Executive Boards. The implementation of the JIU recommendations remains a critical endeavor to strengthen the governance and oversight across our Executive Boards and in so doing, enhance the effectiveness and credibility of our work. Our shared objective is to make the Board processes and working methods as efficient and harmonized as possible while fully preserving robust oversight and accountability mechanisms. Over the past year, much of the Working Group's efforts focus on establishing itself, defining its work methods as well as supporting other as well as other supporting documents.

Against this background, we particularly welcome the progress made since the second regular session in 20245 notably the preparation and circulation of questionnaires to all five funds and programs which marked the start of the implementation phase. We recognize that the Working Group undertaking a thorough assessment of the relevance and feasibility of the JIU's individual recommendations is an essential intermediate step to improve the future functioning of the Executive Boards. This process is especially important as it complements the UN80 initiative with processes guided by common objectives such as increased efficiencies, more clearly defined responsibilities and strengthened governance structures as outlined in the roadmap. We subscribe to an approach that allows for the early implementation of these recommendations that can be realized with limited effort or only require minor adjustments. This approach would create the necessary space and time to engage more deeply with recommendations that warrant further discussion and analysis in order to identify the best way forward.

In our view, it is important that the Executive Boards see clear outcomes emerging in a timely manner, ideally already by the annual session in 2026. We therefore implore the Working Group to move decisively towards delivering first concrete results. This would help maintain momentum and provide confidence that the process is translating into practical improvements in our governance and oversight functions. We remain committed to supporting this process in a constructive and forward looking spirit and looked forward to continued engagement with the Working Group as It advances its work. I thank you.

I thank the distinguished representative of the United Kingdom. And now it's going to check if there are any additional requests for the floor. I don't have any registered. So far I see none. And I'll give the floor back to our representative of the Joint Working Group for any reactions.

You have the floor.

Thank you so much, Mr. President. And we appreciate the two group statements made by Zambia and the UK. Definitely your comments are taken on board and we will consider with other members of the group how to incorporate them into our work. We definitely, as Zambia mentioned in their statement, also understand that each recommendation has its pros and cons and we need to find the best approach to the implementation.

But definitely our aim should be also always strengthening of governance and oversight of our boards and enhancing their effectiveness. And with regard to the UK's comments, definitely the group will strive to deliver on its mandate. Please expect to receive the Annual session preliminary findings. And there we would like to also see here some inputs and reactions from from the Board. And our intention is to present the report with potentially conclude proposals on the operationalization of the recommendations at the second regular session.

So we'll try to stick as much as possible to this timeline and then definitely will appreciate our further engagement at the Annual Session. Thank you.

Thank you very much. Thank you very much for that delivery. Ladies and gentlemen, this concludes the consideration of agenda item number four as regards the Executive Board action. I wish to inform the Board that a draft decision on agenda item 4 on the update of the assessment of how the Executive Board executes its governance and oversight functions is under preparation and will be presented for the Board's consideration later in the session.

Ladies and gentlemen, I want to thank you for your kind attention and presentation, just your presence here. Tomorrow we shall meet at 10 o'. Clock. We will continue the first regular session or with the UNDP segment this afternoon. Meeting is now adjourned.

Distinguished delegates, we will resume negotiations on the two pending decisions in Conference Room D, 5:15pm thank you.