This working paper, developed by a team from the World Bank, emphasises the crucial role of effective public institutions in tackling climate change, highlighting the need for institutional capacities to translate commitments and financing into tangible outcomes. It discusses how climate impacts and decarbonisation efforts require significant institutional capabilities across various sectors, from managing scarce resources to coordinating complex energy transitions. It argues that traditional public sector management approaches are insufficient, as institutions must adapt to increased time pressures, frequent shocks, and uncertainty. 

The paper outline four key ways public institutions must operate differently: 

• enhancing coordination
• managing transitions within compressed timescales
• utilizing data and knowledge effectively, and
• supporting citizens and businesses in adapting to climate challenges. 

The paper also stresses the importance of calibrated support for institutional development, considering each country's specific needs, priorities, and starting points, and learning from past efforts to ensure sustainable and impactful progress. It highlights that many countries most vulnerable to climate change start from relatively low capacities, and tackling this requires much greater attention and efforts integrating political, technical, and public administration perspectives.   

The paper's authors, Verena Fritz and Rachel Ort, welcome feedback on this working paper (including examples of institutional challenges and progress) by 20 June 2025 at vfritz@worldbank.org and rort@worldbank.org.