OECD Development Co-operation Peer Reviews: Switzerland 2025

Annex B. Progress against OECD legal instruments under the responsibility of the DAC

Recommendations adopted by the Development Assistance Committee

DAC Recommendation on the Terms and Conditions of Aid

Within Switzerland’s ODA portfolio in 2023, 100% was provided in the form of grants. In 2023, the Swiss Investment Fund for Emerging Markets (SIFEM) extended USD 75.9 million in the form of private sector instruments (PSI) to developing countries. Of this, loans accounted for 24.6% whereas equities represented 77.5%. In 2023, the grant element of ODA commitments was 100%, above the minimum requirement of 86%. [OECD/LEGAL/5006]

DAC Recommendation on Untying Official Development Assistance

Switzerland currently leads the way on untying. Looking at ODA covered by the Recommendation on Untying [OECD/LEGAL/5015], Switzerland reported 100% of its aid as untied in 2023, similar to previous years. Looking at all bilateral ODA beyond the coverage of the Recommendation, Switzerland reported 98.1% as untied. However, the upcoming partially tied aid programme in Ukraine puts commitments to untying ODA at risk.

DAC Recommendation on the Humanitarian-Development-Peace (HDP) Nexus

Through the F4P process, Switzerland has started the most ambitious administrative reform amongst all DAC members to implement the DAC Recommendation on the HDP Nexus [OECD/LEGAL/5019]. In bringing together the Humanitarian and Development units in Headquarters, Switzerland can have a joined-up analysis and response to emerging or protracted crises, linking short and long-term responses, including in its dialogue with its multilateral partners.

Throughout the process, however, several SDC internal documents refer to the “humanitarian-development” nexus. While peace activities are an integral part of the budget line for development co-operation, the omission of the “peace” element reflects how SDC’s contribution to peace remains less integrated into the cultural shift at play within SDC. The creation of the Peace, Governance and Equality Section within SDC therefore represents an important opportunity to continue the shift towards a more integrated HDP-nexus thinking.

SDC is already quite advanced in supporting several important aspects of the DAC Recommendation. The joint desks already allow for more refined context analysis across the HDP nexus, and programming is already benefiting from a better overview across both pillars when interacting with multilateral organisations, almost all of which work across the three aspects of the HDP nexus in crisis settings and understand the possible impact of their operations on peace or conflict prevention.

Through SDC, Switzerland also remains a solid champion of the Grand Bargain, and its self-reporting shows how Switzerland has been involved in championing some key policy discussions, particularly on locally led development, where its engagement in various related policy networks has helped move forward global research and global commitments.

Switzerland’s “good humanitarian donorship” was already noted in the last review, and the DAC Recommendation on the HDP Nexus came to support the F4P process, which gives more flexibility to Switzerland funding. As noted in the report, a bigger humanitarian budget can now bring Switzerland’s HDP nexus approach to crises to another level, whereby a Switzerland response would be flexible and based on a joint needs analysis more comprehensively than the strict ‘humanitarian’ or ‘development’ label of its two financial instruments.

DAC Recommendation on Ending Sexual Exploitation, Abuse and Harassment in Development Co-operation and Humanitarian Assistance

Switzerland is considered amongst the “top of the class” for its implementation of the Recommendation [OECD/LEGAL/5020]. Switzerland prioritises Prevention of Sexual Exploitation, Abuse and Harassment (PSEAH) engagement at the country level, with substantial dialogue between its country offices and implementing partners as a key objective. By the end of 2023, 30 Swiss representations were PSEAH-active, an increase from 20 in 2022, and with a target of 40 by 2024. The SDC has developed a detailed internal "How-to Note" to guide management and staff in handling SEAH cases within partner organisations, emphasising a survivor- and victim-centred approach. A whistleblowing platform is operational and actively used, influencing dialogues with partner agencies. Additionally, Switzerland remains an active member of international donor co-ordination groups, reinforcing its commitment to PSEAH principles.

Switzerland invests in the dissemination of SEAH prevention and responses at the local level, in an attempt to ‘shift power’ to the local level. On December 2, 2024, Switzerland hosted their first International Conference on the Prevention of Sexual Exploitation, Abuse and Harassment (PSEAH) with the Government of Kenya. It was decided to centre voices from the global South, bringing in a vast variety of representatives from governments, multilaterals and civil society. This initiative is an example of Switzerland’s dedication to localising the SEAH agenda and should be underlined.

DAC Recommendation on Gender Equality and the Empowerment of All Women and Girls in Development Co-operation and Humanitarian Assistance

Switzerland has made efforts to strengthen systems to address gender inequalities more effectively, and its progress aligns with external observations of its work in this area. Switzerland is actively reflecting on how to address intersecting inequalities, ensuring that output indicators and data are appropriately disaggregated—an area in which it is considered to be at the forefront. Switzerland has established financial targets for gender equality, which have proven effective in raising attention to the issue. While these targets are not yet achieved, Switzerland ranks among the top six DAC members, with 72% of screened bilateral allocable aid to gender equality and women’s empowerment, significantly exceeding the DAC average of 42%. This underscores Switzerland’s strong policy focus on gender equality. [OECD/LEGAL/5022].

DAC Recommendation on Enabling Civil Society in Development Co-operation and Humanitarian Assistance

Switzerland plays a leading role in the DAC Community of Practice (CoP) on Civil Society, serving as co-chair since February 2022. It fosters collective action on civil society issues, including leading discussions on harmonising due diligence requirements with other CoP members like Iceland, Italy, the Netherlands, and Ireland. Switzerland has contributed significantly to developing three toolkits under the DAC Recommendation on Enabling Civil Society [OECD/LEGAL/5021] by participating in sounding boards and sub-groups that share evidence and provide inputs. Beyond CoP activities, Switzerland advocates for civil society in other DCD areas, such as engaging in peer learning exercises on locally led development. Additionally, several international CSOs based in Switzerland are active in the DAC-CSO Reference Group, strengthening collaboration and influence.

In terms of civil society policies and practices, Switzerland’s International Cooperation Strategy 2025–2028 integrates civil society organisations (CSOs) as key partners, emphasising collaboration with local actors in line with the DAC Recommendation. This commitment is reflected in Swiss NGO engagement guidance and the ongoing process of allocation of core contributions 2025-28.

To co-ordinate efforts regarding locally led development (LLD) across the humanitarian-development-peace nexus in all of SDC's work, Switzerland is developing a practical pathway to strengthen the SDC narrative on LLD and align internal practices, processes and instruments. This is a joint follow up of the OECD DAC learning journey on LLD and reflects the inclusion of LLD as a core implementation modality in Switzerland's International Cooperation Strategy 2025-28.

In 2023, an SDC survey mapped civil society engagement practices, and a working aid was published on protecting civic space in authoritarian contexts. Notable initiatives include SDC’s Civil Society Support Facility, the Partnership Fund for a Resilient Ukraine (PFRU), embassy micro-grants, and Fair Partnership Principles valuing local capacities.

Recommendations adopted by the Council under the DAC’s responsibility (joint with other OECD committees)

Recommendation on Policy Coherence for Sustainable Development

Switzerland has established co-ordination and consultation mechanisms across government levels to enhance policy coherence for sustainable development [OECD/LEGAL/0381]. The Federal Council employs a two-stage consultation process, beginning with technical consultations to gather input from relevant offices, followed by political consultations among Federal Councillors to balance perspectives and integrate sustainability considerations. This approach aims to identify and mitigate potential policy inconsistencies early on. The 2030 Sustainable Development Strategy (SDS), along with its four-year action plans, promotes the integration of sustainability into sectoral policies, guiding federal efforts towards the 2030 Agenda. The new action plan (2024–2027) includes an analysis of transboundary spillover effects of new policies. Sustainable development and policy coherence are also embedded in key policy documents, such as the Swiss Foreign Policy and Foreign Economic Policy Strategies and the International Cooperation Strategy.

Switzerland fosters collaboration on development priorities through biannual roundtables with NGOs, the private sector and other stakeholders to discuss coherence with its foreign and economic policies. It conducts national consultations to evaluate its International Cooperation Strategies, engaging cantons, political parties, NGOs, and other stakeholders. The annual International Cooperation Forum gathers partner organisations and the public in different cities to discuss specific themes. During the 2022 Voluntary National Review (VNR) process, Switzerland invited over 300 organisations, cantons, and municipalities to contribute via an online tool (www.SDGital2030.ch), fostering transparency and inclusivity. The next VNR will follow this model for submission to the UN in 2026.

During the peer review it was observed that Regulatory Impact Assessments (RIAs) are conducted but do not seem to take development considerations into account. Switzerland's Free Trade Agreement (FTA) with Indonesia, negotiated within the framework of the European Free Trade Association (EFTA), is an example of policy coherence in several respects, aligning trade, environmental and social policies in support of sustainable development, but it has not resulted in the import of more sustainable palm oil from Indonesia. When development interests clash with economic interests, as was the case for patents for COVID19 vaccines, the latter tend to get prioritised.

Recommendation for Development Co‑operation Actors on Managing the Risk of Corruption

At policy level, five fields of action have been identified for Switzerland's international co-operation, grouped into two main policy areas:1) Financial flows and trade relations: minimising the risk of illegal financial flows in the commodities value chain; improving access to financial services and remittances; and combating tax avoidance and evasion; and 2) Governance and the rule of law: combating transnational corruption and money laundering; and restitution of illicitly acquired assets. Regarding the responsible return of illicit assets, in particular, Switzerland has been able to establish a number of good practices (for example regarding the end use, monitoring, civil society involvement, etc.) that have made it a pioneer in the field. It actively promotes these principles and good practices at global level to emphasise the importance of asset restitution for sustainable development and the implementation of the 2030 Agenda.

The following good practices were identified in the Monitoring Report of the Recommendation [OECD/LEGAL/0431]:

• The Swiss Financial Intelligence Unit (MROS) plays a pivotal role in addressing foreign bribery by raising awareness among financial intermediaries about their responsibilities in detecting such offences. The Office of the Attorney General (OAG) has also made significant progress, establishing a specialised group, "AG 102," to handle corporate criminal liability cases consistently. The OAG collaborates actively with international law enforcement, as demonstrated in the Odebrecht case alongside US and Brazilian authorities. Additionally, streamlined money laundering report processing and legal developments, such as recognising "de facto public officials" and enforcing corporate liability for successor companies under Article 102(2) of the Swiss Criminal Code, have enhanced Swiss anti-bribery enforcement.

• Switzerland extends corruption risk management beyond financial audits through the Federal Department for Foreign Affairs (FDFA). Its internal audit unit examines not only financial aspects but also systems, processes, and accountability measures. Risk-oriented audits, guided by nine criteria, consider financial volumes, staff size, and corruption indices in operational countries. The FDFA ensures systematic follow-up on audit recommendations, with specific timelines for implementation, and adjusts management and risk processes accordingly. This comprehensive approach strengthens Switzerland’s capacity to manage corruption risks effectively, both domestically and in foreign operations.

• A critical aspect of Switzerland’s anti-corruption efforts is the identification, freezing, confiscation, and return of stolen assets. Switzerland engages in constructive dialogue with affected governments to ensure that returned assets benefit local development or strengthen the rule of law. By focusing on politically exposed persons and aligning asset recovery processes with development objectives, Switzerland addresses key international drivers of corruption, reinforcing its commitment to transparency and accountability.

The report on Oil commodity trading and addressing the risk of illicit financial flows highlights key risks and measures. Switzerland is a global hub for oil trading, with Swiss-based companies like Glencore accounting for a significant share of global trade. However, the use of offshore financial centres (OFCs) is widespread, with 96.7% of Swiss trading subsidiaries owned through OFCs, raising concerns about obscured financial flows and weakened oversight. Risks emerge at various stages of the trading process, including buyer selection, opaque sales negotiations, and non-transparent revenue transfers, all of which can facilitate bribery, corruption, and fund diversion. Swiss firms have primarily relied on voluntary measures to address these risks, though recent legal cases, including bribery charges, have cast doubt on their effectiveness. Calls for stricter legislation and enforcement are increasing, as current measures, such as voluntary company controls and reliance on banks’ due diligence, often fail to adequately mitigate IFF risks.

Recommendation on Environmental Assessment of Development Assistance Projects and Programmes

Since 2019, Switzerland is one of the few DAC members to use a “climate++” screening tool, the Climate, Environment and Disaster Risk Reduction Integration Guidance (CEDRIG). This tool helps assess whether SDC’s strategies, programmes and projects are at risk from climate change, environmental degradation or natural hazards, and has played a key role in mainstreaming climate issues while considering environmental and disaster risk reduction (DRR) concerns. This tool is currently being upgraded to introduce greater context analysis but also to shift from risk-proofing to adding value and sustainability in development initiatives, which is positive. The tool is complemented with concrete guidance. As an example, thematic Integration Briefs are currently being developed by SDC to provide concrete entry points for interventions which are at the intersection of climate, DRR and environment and other themes, e.g., migration, or economy and education. However, Switzerland could further explore how to support non-experts, especially as green issues are becoming more complex, to ensure that CEDRIG is used as a driver of change. The creation of climate hubs in Bangkok and Lima is positive and could be extended to other regions. [OECD/LEGAL/0458].

At SECO, new projects are also checked against climate and environmental risks. Where risks are identified, measures for mitigation must be proposed.

OECD-DAC Declarations

OECD DAC Declaration on a new approach to align development co-operation with the goals of the Paris Agreement on Climate Change

Climate change and environment were set as one of four overarching objectives of the current Swiss International Co-operation Strategy 2021-2024. “Addressing Climate Change and its Effects and Managing Natural Resources Sustainably”. This is the only objective that has a financial target in the 2021-24 Strategy: Switzerland’s international co-operation funding in this field is set to increase gradually from CHF 300 million per year in 2017-20 to CHF 400 million per year by the end of 2024. Climate change and environment will also be one of four objectives of the IC Strategy 25-28

In 2021-22, 30% of total bilateral allocable aid (USD 827.1 million) focused on climate change overall, up from 19.5% in 2019-20 (the DAC average was 30.5%). Switzerland had a greater focus on adaptation (23.4%) than on mitigation (17.4%) in 2021-22.

In view of fostering its alignment with the Paris Agreement, SECO Economic Cooperation has formalised its Development’s Approach to Climate Change in a position paper outlining five measures, with a particular focus on the following areas of intervention: energy, sustainable production, green public and private finance and sustainable urban development. The position paper is complemented by a Climate Action Plan that includes various measures to support SECO’s alignment with the Paris Agreement[OECD/LEGAL/0466]. Examples include the deployment of tools, procedures and guidelines specifically related to the alignment; building SECO’s climate capacities at HQ and in the field; and mainstreaming climate into the design of its co-operation projects. As an example, in South Africa SECO supports local governments in improving infrastructure planning. The Climate, Environment and Disaster Risk Reduction Integration Guidance (CEDRIG) allows for the integration of climate, DRR and environmental issues at strategic and operational level which contributed to significantly increase the contribution of SDC’s programmes to Switzerland’s international climate finance.

Further reading

OECD, Recommendation on Terms and Conditions of Aid, OECD/LEGAL/5006, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5006 (accessed on 28 November 2024).

OECD, DAC Recommendation on Untying Official Development Assistance, OECD/LEGAL/5015, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5015 (accessed on 28 November 2024).

OECD, DAC Recommendation on the Humanitarian-Development-Peace Nexus, OECD/LEGAL/5019, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5019 (accessed on 28 November 2024).

OECD, DAC Recommendation on Ending Sexual Exploitation, Abuse, and Harassment in Development Co-operation and Humanitarian Assistance: Key Pillars of Prevention and Response, OECD/LEGAL/5020, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5020 (accessed on 28 November 2024).

OECD, DAC Recommendation on Gender Equality and the Empowerment of All Women and Girls in Development Co-operation and Humanitarian Assistance, OECD/LEGAL/5022, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5022 (accessed on 28 November 2024).

OECD, DAC Recommendation on Enabling Civil Society in Development Co-operation and Humanitarian Assistance, OECD/LEGAL/5021, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-5021 (accessed on 28 November 2024).

OECD, Recommendation of the Council on Policy Coherence for Sustainable Development, OECD/LEGAL/0381, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0381 (accessed on 28 November 2024).

OECD, Recommendation of the Council for Development Co-operation Actors on Managing the Risk of Corruption, OECD/LEGAL/0431, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0431 (accessed on 28 November 2024).

OECD, Recommendation of the Council on Environmental Assessment of Development Assistance Projects and Programmes, OECD/LEGAL/0458, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0458 (accessed on 28 November 2024).

OECD, OECD DAC Declaration on a new approach to align development cooperation with the goals of the Paris Agreement on Climate Change, OECD/LEGAL/0466, https://legalinstruments.oecd.org/en/instruments/OECD-LEGAL-0466 (accessed on 28 November 2024).