The Clean Development Mechanism: Institutionalizing New Power Relations

The differences in the way climate change mitigation projects are facilitated under the Kyoto Protocol as compared to the financial mechanism of the United Nations Framework Convention on Climate Change (UNFCCC) demonstrate institutional change processes that evolved from global climate change negotiations. Institutional change happens when new practices become accepted and interactions between organizations carry new meanings. Models of the two policy options are presented in this paper depicting organizational interactions to demonstrate the evolution of rule-setting in this arena. A discussion of power implications is provided with the conclusion that countries of the North as well as business corporations have increased their influence in the institutional framework of international climate change mitigation. Institutional theory needs to be further developed to be able to explain the dynamic changes that led to this shift in power potential.