Global blended finance initiative the Subnational Climate Fund (SCF) has been awarded a design certification from sustainability standards provider Gold Standard.
Through its pilot scheme, whereby impact funds and bond issuers must meet specific requirements, Gold Standard aims to validate impact results and help investors and bond holders measure and manage the impact of their investments on sustainable development.
The requirements are compatible with other leading standards, including the Operating Principles for Impact Management (OPIM), the UN Principles for Responsible Investment (UN PRI) and UNDP (United Nations Development Programme) SDG Impact Standards. This reduces reporting obligations for firms.
The design certification recognises that the SCF applies the Gold Standard for Global Goals safeguarding principles and requirements to its investments, and that the fund’s governing body considers the UN’s sustainable development goals when making decisions.
In order to achieve the certification, SCF must also include an exit strategy in all of its investments in order to ensure that the ‘do no harm’ principle is maintained for the investment’s lifecycle.
Margaret Kim, CEO of Gold Standard, says: “By working with Gold Standard and focusing on impact, SCF can be sure that they are identifying investments that will make a genuine, tangible, verifiable difference to the UN’s Sustainable Development Goals, and demonstrate results in the real world.”
Craig Cogut, CEO and founder of Pegasus Capital Advisors, comments: “Given Gold Standard’s rigorous requirements for stakeholder inclusivity, impacts linked to SDGs with approved methodology, safeguards to avoid unintended negative effects and the mandatory third-party audit, we are convinced that Gold Standard will set the bar high for investors who are committed to sustainable development impacts.”
