LoCaL helps Gold Standard SDG certification unlock finance for climate action

Gold Standard, the standards and certification body known for its work in carbon offsetting, has this week launched a new scheme based on the Sustainable Development Goals. The “Gold Standard for Global Goals” offers businesses, governments and investors a way to recognise and support initiatives that work towards achieving the SDGs. The standard is expected to open up new avenues of funding for green infrastructure and sustainable supply chain interventions.

A major part of this, the Urban Development module, was developed in collaboration with EIT Climate-KIC’s urban climate finance programme, Low Carbon City Lab. We spoke to Gold Standard Chief Executive Officer Marion Verles to find out how the standard will help measure, report and track SDG-related projects around the world.

Why has Gold Standard begun issuing a range of certified Sustainable Development Goal (SDGs) impacts?

Since the day we were founded, our mission has been to bring environmental sustainability development requirements to the carbon markets. A couple of years ago, we looked at the strengths we could build on to contribute to addressing some of the world’s biggest challenges, and what we identified was a very strong need to deliver solutions to quantify impacts.

The only way we can know if we’re on track to achieve a 1.5°C world and the Sustainable Development Goals is if we can actually assess how much each project, how much each investment, how much each policy, how much each decision is contributing to achieving those goals.

We can only monitor and track progress if we are able to quantify impacts. As a standards body geared to quantifying climate and sustainable development impact, we felt we could make a meaningful contribution if we worked to bring some of the expertise we had developed for carbon markets to quantifying sustainable development impact.

How does the Gold Standard for the Global Goals build on previous work?

The new standard is both an evolution and a revolution. It’s an evolution because we are building off the existing standards that we’ve been managing. Rather than continue to manage four different standards in parallel, for energy, forestry, agriculture, and cities, we’ve integrated them into one platform.

Rather than have to replicate every single change across the four standards we only have one platform. Every single improvement, enhancement or innovative solution will be applicable across the board. It’s also a revolution because the standard is proposing a number of innovations that are first of their kind. Since the beginning, every Gold Standard project had to demonstrate contribution to three sustainable development objectives.

The Millennium Development Goals was the benchmark to defining sustainable development, and now we’re using the SDGs, but that contribution to three objectives was always there. What makes Gold Standard projects so different is that we are not only talking about the positives. The requirements that are in the standard make it necessary for projects to also mitigate the negatives. As science moves forward and as we uncover new connections and new interactions between development objectives. We are updating our standard so that it always remains up to date with latest science and the latest thinking around integrated approaches, holistic design and holistic impact.

The new standard is measuring many inter-related things simultaneously. How do you take into consideration negative cross-impact and trade-offs?

To become a Gold Standard certified programme, you have to go through a process which covers a number of steps, including the management of negative impacts. Depending on the intervention, we would pre-select some of the negative impacts that you have to look at. There are also specific trade-offs that we make mandatory for those who seek certification to actively investigate and manage.

Once you’ve been through that process you’re deemed eligible to become a Gold Standard certified programme. That’s when you can actually start quantifying your impacts. You can use our impact quantification methods, or you can propose your own methodologies if it’s for reporting purposes. We require at least three, covering the environmental, social and economic impacts of sustainable development.

For example, in a large-scale waste management programme in an urban context, we would look at climate mitigation from avoided methane; economic impact associated with the management of the waste that would create jobs and a value chain of waste management companies. A third social impact might enhance people’s living conditions by taking waste out of the streets.

How did EIT Climate-KIC’s Low Carbon City Lab help you build the Urban Development module under the new standard?

We worked with Climate-KIC on the application of the new standard in urban contexts. We developed specific guidelines and requirements for sustainable urban development programmes to make sure the requirements for the standard are fit for purpose. One value proposition is that the standard is a way to de-risk a large scale investment in a low-carbon urban development programme.

The standard would ensure that the programme is following international best practice, has the right management practices in place, that it went through appropriate stakeholder processes, and has identified and managed a negative impact. From an investor perspective, investing in a certified programme is a way to de-risk your investment. Also, the ongoing monitoring of the programme following Gold Standard requirements will give an investor access to impact data that is credible, because it is third-party verified.

It’s comparable because the impact data follows the SDGs as a framework. On top of that, if the project is eligible, impacts could be monetised through [for instance] issuing credits or renewable energy certificate labels that would unlock additional funding for the programmes. You could even structure social bonds. If the programme is improving air quality in a city, you may have an investor or a city government that wants to pay X for each unit of health impact that is being delivered. You could use that certification to go beyond reporting and actually monetise those impacts and unlock new sources of funding for the programmes. We’ve also been looking at what could be the type of resource-based finance structures that would be most relevant in that context — who would the players be that we would have to involve and how would it take shape?

What’s the outlook for the Urban Development module?

The expertise and the EIT Climate-KIC network of partners has been extremely valuable to us. We are now in discussions with a few investment funds that are looking at making massive investments into sustainable urban development programmes.

They want to use our standard as a platform to roll out their due diligence requirements, their monitoring requirements, and also look at unlocking specific resource-based finance through carbon markets, renewable energy markets or other impact-based markets.

Who else is working in this space?

I think there are other standards that overlap on one of key value propositions but none of them overlap on all of them. The leading voluntary carbon standard from a market share perspective is the Verified Carbon Standard, which has over 50 per cent of the market share.

You have some standards that don’t quantify carbon but that are used as an add-on to a carbon standard and they would only look at the sustainable development aspects like social carbon. We’re the only platform that provides a one-stop shop solution that is not a one-size-fits-all because we can be tailor-made to your needs.

For us it’s driven by our mission and the very deep conviction that if we are to meet our 1.5°C target, the only way we can get there is by embedding sustainable development considerations in every single climate-related decision and intervention. Those two agendas cannot be tackled separately. If we fail one we will fail the other. EIT Climate KIC’s Low Carbon City Lab (LoCal) aims to reduce global greenhouse gas emissions by one gigatonne per year and unlock € 25 billion worth of climate finance for cities by 2050. The platform’s partners provide cities with better tools for assessing greenhouse gas emissions, planning, investing and evaluating progress towards a low-carbon future.

 
Location
Related Focus Area
Urban Transitions
Related Goal
Goal 2: Create green, resilient cities
Articles you may be interested in
In Detail
Clean and Healthy Construction

Insights from the C40 Worlds Mayor Summit in Copenhagen: Master Class and Market Dialogue for Clean and Healthy Construction. Why clean construction? Kevin Austin,...

Clean and Healthy Construction
Opinion
If we have figured out transformation, why is the world still in such a mess?
Susannah Fisher Research, EIT-Climate-KIC
If we have figured out transformation, why is the world still in such a mess?
Opinion
The tyranny of categorisation
Dominic Hofstetter Transformation Capital, EIT Climate-KIC
The tyranny of categorisation
Opinion
EIT Climate-KIC strengthens biodiversity through systems change
Felicity Spors Head of International Affairs, EIT Climate-KIC
EIT Climate-KIC strengthens biodiversity through systems change
Opinion
Why our cities must act as beacons for ambitious climate action
Tom Mitchell Chief Strategy Officer, EIT Climate-KIC
Why our cities must act as beacons for ambitious climate action
In The News
Biggest-ever global hackathon to tackle climate breakdown

Over 100 Climathon events around the world turn grassroots...

Biggest-ever global hackathon to tackle climate breakdown
In The News
Global call for transformative solutions to tackle the climate emergency

EIT Climate-KIC launches Climathon Global Awards and Healthy, Clean...

Global call for transformative solutions to tackle the climate emergency
In The News
EIT Climate-KIC supported crop insurance project acquired by world’s largest...

The insurance sector is well aware of the rising...

EIT Climate-KIC supported crop insurance project acquired by world’s largest re-insurer
In The News
EIT Climate-KIC innovators celebrated at 2019 EIT Awards

The European Institute of Innovation and Technology (EIT) has...

EIT Climate-KIC innovators celebrated at 2019 EIT Awards
Opinion
Part three: Climate action #NotinNewYork
Andy Kerr Director, UK & Ireland, EIT Climate-KIC
Part three: Climate action #NotinNewYork
In Detail
New EIT Climate-KIC supported report finds digital technologies can vastly a...

As part of the UN Climate Action Summit, the Global Enabling Sustainability Initiative (GeSI) and Deloitte launched a report today, supported by EIT Climate-KIC,...

New EIT Climate-KIC supported report finds digital technologies can vastly accelerate the SDGs
Opinion
Part two: Climate action #NotinNewYork
Andy Kerr Director, UK & Ireland, EIT Climate-KIC
Part two: Climate action #NotinNewYork
Opinion
Climate action #NotinNewYork
Andy Kerr Director, UK & Ireland, EIT Climate-KIC
Climate action #NotinNewYork
In The News
Circular Cars Initiative launched at United Nations Climate Action Summit

On the occasion of the United Nations Climate Action...

Circular Cars Initiative launched at United Nations Climate Action Summit
In The News
We’re closing for business in solidarity with #ClimateStrike

EIT Climate-KIC will close this Friday 20 September, the...

We’re closing for business in solidarity with #ClimateStrike
In The News
Open Innovation Call targeting air quality and urban heat island effect launch...

The City of Copenhagen’s department Resilient and Sustainable City Solutions within...

Open Innovation Call targeting air quality and urban heat island effect launched
In The News
EIT Climate-KIC cleantech start-up ZOLAR attracts 10 Million Euro Investment

The Berlin-based start-up Zolar raises a 10 million EUR...

EIT Climate-KIC cleantech start-up ZOLAR attracts 10 Million Euro Investment
In The News
Breaking down barriers to climate-finance: the City Finance Lab launches secon...

Competition for the five most innovative financing solutions for...

Breaking down barriers to climate-finance: the City Finance Lab launches second call for proposals
Opinion
Innovating in complexity: Systemic investing
Dominic Hofstetter Transformation Capital, EIT Climate-KIC
Innovating in complexity: Systemic investing
In The News
Climathon onboard ‘Sail to the COP’

On 2 October, 36 young climate change agents will...

Climathon onboard ‘Sail to the COP’
In The News
Research reveals surprising link between socio-economic indicators and sustain...

A new study by EIT Climate-KIC partner academic institutions...

Research reveals surprising link between socio-economic indicators and sustainability transition
Opinion
Transformation capital: A new investment logic for catalysing systems change
Dominic Hofstetter Transformation Capital, EIT Climate-KIC
Transformation capital: A new investment logic for catalysing systems change
Opinion
Innovating in complexity: From single-point solutions to directional systems innovation
Dominic Hofstetter TRANSFORMATION CAPITAL, EIT CLIMATE-KIC
Innovating in complexity: From single-point solutions to directional systems innovation
In The News
Four EIT Climate-KIC innovators nominated for annual EIT Awards

The European Institute of Innovation and Technology (EIT) has released...

Four EIT Climate-KIC innovators nominated for annual EIT Awards
In Detail
Report offers recommendations for development of agricultural impact tool

A new report supported by EIT Climate-KIC’s CSA Booster programme proposes technical, governance and business arrangements for the development of a new tool for...

Report offers recommendations for development of agricultural impact tool
In Detail
Food value chains strategy report offers recommendations based on systemic i...

A new report details the work of EIT Climate-KIC and its partner Metabolic, a consulting company using systems thinking to tackle major sustainability challenges,...

Food value chains strategy report offers recommendations based on systemic impact
In The News
EIT Climate-KIC supports digital roadmap for a circular economy

EIT Climate-KIC, along with several European stakeholders, is advocating...

EIT Climate-KIC supports digital roadmap for a circular economy
In The News
EIT Climate-KIC urges London to lead in turning climate emergency into action

Climate innovation agency EIT Climate-KIC welcomed today the first...

EIT Climate-KIC urges London to lead in turning climate emergency into action
Opinion
London Climate Action Week: Climate Innovation Insights
London Climate Action Week: Climate Innovation Insights
Opinion
How can we deliver a net-zero emissions UK?
Andy Kerr Director, UK & Ireland, EIT Climate-KIC
How can we deliver a net-zero emissions UK?