CHECKLIST FOR ENTITYCERTIFICATIONAPRIL 2023
Version 1.0

Accompanies the Climate Bonds Standard v4.0

The Checklist below describes more precisely what is required in order to meet the Entity Certification criteria as
described in Part C of the Climate Bonds Standard v4.0. The Guidance column provides supporting information that
may be useful in interpreting the Criteria and associated Checklist requirements.
Climate Bonds will also make available on its website an Excel version of the Checklist for use in Verification
Engagements.
The Checklist and supporting guidance have been prepared by Climate Bonds to address its specific Certification
Criteria, but a number of sources of similar guidance have informed this.1

These include but are not limited to: ACT Framework (act-framework-eng-2019-04-09.pdf (actinitiative.org), Moody’s proposed Net Zero Assessment
methodology, The Transition Plan Taskforce (TPT) Implementation guidance (TPT-Implementation-Guidance-1.pdf (transitiontaskforce.net)), GFANZ’s
Expectations for Real-Economy Transitions (Expectations-for-Real-economy-Transition-Plans-September-2022.pdf (bbhub.io) and Recommendations-andGuidance-on-Financial-Institution-Net-zero-Transition-Plans-November-2022.pdf (bbhub.io), The Transition Pathway Initiative’s methodology report:
Management Quality and Carbon Performance Version 4.0, November 2021 (90.pdf (transitionpathwayinitiative.org) (90.pdf(transitionpathwayinitiative.org), SBTi’s Net Zero Standard v1.0 (Net-Zero-Standard.pdf (sciencebasedtargets.org)), SBTi’s Target Validation Protocol (targetvalidation-protocol.pdf (sciencebasedtargets.org)), TCFD Task Force on Climate Related Financial Disclosures 2021-Metrics_Targets_Guidance-1.pdf(bbhub.io), Illustrative Examples of Selected aspects or EER Assurance Engagements under ISAE3000 https://www.iaasb.org/publications/non-authoritativeguidance-applying-isae-3000-revised-extended-external-reporting-assurance), IFRS Exposure Draft S1 General Requirements for Disclosure of Sustainabilityrelated Financial Information, (Climate Action 100+ Net Zero Company Benchmark PDF, Oct 2022) and Climate Action 100+ Net Zero Company Benchmark
PDF v1.2 Oct 2022), ICMA Climate Transition Finance Handbook, December 2020 (Climate-Transition-Finance-Handbook-December-2020-091220.pdf(icmagroup.org))

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

C.1. INTRODUCTION
Eligible Entities

Currently, Entity Certification islimited to non-financial Entities
or segregated segments
thereof, for which the Climate
Bonds Initiative has Climate
Bonds Standard Sector Criteria
for Entity Certification

In the Climate Bonds Standard v4.0, an Entity isdefined as a legal entity, duly incorporated andvalidly existing in the jurisdiction in which it
operates, providing non-financial goods andservices or a segregated segment thereof. It may
or may not include other controlled entities(subsidiaries).
This includes:••

State-Owned Entities (SOEs) that are legal
entities with full- or partial-government
ownership established to engage in specificcommercial activities, with its own
management body, governance structure
and business planning and reporting
processes. Note, sovereigns, municipalities
and local authorities do not fall under thisdefinition of SOEs; andReal Estate Investment Trusts (REITs) where
they own or operate income-generating realestate. Note, REITs which hold financial
assets such as mortgages on real estate
property do not fall under this definition of
REITs.

C.2. ELIGIBILITY & ACCOUNTING RULES
C.2.1 Applicant
control of theCertified Entity

C.2.2. Boundaryof the Certified
EntityThe Applicant must either be
the same legal entity as theCertified Entity or haveoperational control over the
Certified Entity.

The Certified Entity may be agroup of legal entities within aParent Group, a single legal
entity or a segregated segment
thereof, at the Applicant’s
discretion, subject to thefollowing conditions:•Certification of a Parent
Company must include
subsidiaries and othercontrolled companies
within its boundary. The
sole exception is where no

To obtain Certification
Audited financial statements of the
Applicant confirming any parentsubsidiary relationship where theApplicant is the Parent Company, or
alternative evidence may be sought
where the relationship cannot be
confirmed from the audited financial
statements.

The Certified Entity is considered to be
operationally controlled by the Applicant if it is abusiness segment of the Issuer.

For subsequent annual verifications
As ‘To obtain Certification’In the absence of audited financial statements
confirming the relationship, additional evidence
may be:•Corporate documents•
Board minutes of parent/subsidiarycompanies•
Contractual arrangements•
Intra-group reporting arrangements,
policies and procedures•
Governance structures

To obtain Certification

Associates and Joint Ventures over which the
Parent or holding company has significant
influence (i.e., the power to participate in thefinancial and operating policy decisions) but not
the power to control as defined in Clause C.2.1,
will be excluded from the boundary. Dormant
companies can be excluded/ignored.

If the Certified Entity includes a
Parent Company, none of the Parent
Group’s financial, sustainability or
regulatory reports include activities
within the Parent Group that arecovered by Climate Bonds Standard
Sector Criteria but are not in theassessed boundary.
Management representations to thiseffect have been given by theGoverning Body of the Parent

Alternatively, the Certified Entity is considered ascontrolled by the Applicant if it is (part of) a
subsidiary company of the Applicant over which
the Applicant has operational control as definedby the GHG Protocol.

This requires at a minimum a review of audited
financial statements, management reports,
sustainability reports and regulatory reports(where relevant).

Criteria as written in PART C of the Climate Bonds
Standard v4.0••

C.2.3. Obtaining
EntityCertification

Sector Eligibility Criteria
are available to assess theactivities of any subsidiaryor controlled company, inwhich case thosesubsidiaries or controlled
companies may be
excluded from theboundary of the Certified
Entity.
A segregated segment
thereof means a subdivision of a legal entity.
This can be set as theCertified Entity andCertified in its own rightonly if no Climate Bonds
Standard Sector Criteria
exist for the other subdivisions of the legal
entity.
Where an economic
activity of the Certified
Entity is carried out acrossmultiple sub-divisions or
subsidiaries or companies
controlled by the samelegal entity, the Applicant
must include all such subdivisions and subsidiaries
within the boundary of
the Certified Entity.

The Applicant receives a
Verification Report from an
Approved Verifier that:i. The proportion of theCertified Entity’s economic
activities that are counted
as complying with the
Climate Performance,
Delivery Strategy,
Governance andDisclosure requirements inClauses C.3.1, C.3.2, C.3.3
and C.5 respectively
exceeds 90% of theCertified Entity’s total
economic activities; andii. The Parent Group meets
the Climate Safeguard andDisclosure requirements inClauses C.4 and C.5
respectively.
And the Applicant supplies to
the Climate Bonds Standard
Board, through the Climate
Bonds Standard Secretariat, a
copy of the Verification Reportor shares its location on a
public website, for the purpose

Certification Checklist

Additional guidanceCompany on behalf of the Parent
Group.

It is encouraged (but not required) that theboundary of the Certified Entity is aligned with
the Parent Group’s reporting structure that is inaccordance with an international disclosure
framework such as those developed by the Task
Force on Climate Related Disclosures (TCFD) andthe International Sustainability Standards Board(ISSB) and/ or recognised accounting frameworks
such as the IFRS.

For subsequent annual verifications
As ‘To obtain Certification’.

It is recommended that Applicants seek
Certification at the parent- or group-level, not at
the subsidiary level. However, recognising that
the Climate Bonds Standard Sector Criteria do
not have full coverage across all economic
activities, where they are separate legal entities,
subsidiary companies can be certified
independently of their Parent Companies and cosubsidiaries.

To obtain Certification
Demonstration of compliance with
the Certification threshold supported
by either the latest audited financial
statements and/or independently
verified/ audited management
reporting (revenue route) or audited
GHG emissions determined in linewith the GHG protocol within the last
2 years.
Compliance with all the ‘To obtain
Certification’ requirements
documented under Clauses C.3, C.4
and C.5.
For subsequent annual verifications
n/a

Methodology for assessing compliance with the
90% Certification Threshold:
Step 1: At the discretion of the Applicant, theoperations of the Certified Entity must be
disaggregated into its component ‘businessactivities’ according to either:•
Turnover (revenue): historical revenue
after the elimination of any
exceptional/extraordinary or otherwise
non-recurring amounts per the latest
audited annual financial reports and/or
independently verified/ audited
management reporting; or•
GHG emissions: determined in line with
the GHG Protocol Corporate Standard and
GHG Protocol Corporate Value Chain(Scope 3) Standard. This assessment to be
based on emission data that is
independently verified/audited by anaccredited GHG assessor and not morethan 2 years old.
Step 2: For each business activity thus identified
that is fully compliant with requirements inClauses C.3 and C.5, the proportion of revenue /GHG emissions allocated to that activity must be
counted as complying with the Standard.
Clarifying notes:

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklistof publishing on the Climate
Bonds Initiative website.

Additional guidance
1. Where an entity chooses to disaggregate
its operations by Revenue, it is requiredthat the boundary of the Certified Entity isaligned with the Parent Group’s
management and financial reporting
structure.
2. It is required that 100% of the revenue/
emissions of operationally controlled
activity should be included, not just theshare of revenue/ emissions per any
financial or equity control proportions.
3. Revenue/ emissions (depending on thebasis selected for disaggregation) fromany activities that cannot be assessedagainst Climate Bonds Standard entitylevel sector-specific criteria must not becounted towards the certificationthreshold. This includes revenue (oremissions) from financial activities such as
trading or investment.
4. Business operations pursuing the same
economic activity are addressedcollectively through one assessment.
5. If taking the GHG emissions route toallocation, carbon offsets or credits or
avoided emissions should not be taken into
account.
6. If taking the GHG emissions route toallocation, estimates using tools such as
the Scope 3 Evaluator to calculate scope 3
emission category(ies) are acceptable,
although primary data is preferable andbest practice.

See Box C1 for the application
process for obtaining Entity
Certification.
A note on terminology: This
90% is defined as the‘Certification Threshold’, andeconomic activities which meet
the Climate Mitigation
Performance Targets, Delivery
Strategy, Governance andDisclosure requirements per
Clauses C.3.1, C.3.2, C.3.3 andC.5 respectively and hence form
part of this 90% are the‘Compliant Activities’.
To assess compliance with thisthreshold the economic
activities of the Certified Entity
are disaggregated andweighted according to either
their revenue share or share of
GHG emissions. See the ‘Entity
Certification Checklist’
document for details on themethodology to determine
compliance.

See ghg-protocol-revised.pdf (ghgprotocol.org)
and Corporate Value Chain (Scope 3) Standard |Greenhouse Gas Protocol (ghgprotocol.org)
The Applicant may opt to make publicly
accessible a more concise public version of the
Verification Report, in which case the fullassurance report shall be made available to the
Climate Bonds Standard Secretariat.
C.2.4
Maintaining
Entitycertification

The Applicant receives anannual Verification Report froman Approved Verifier that:
In respect of the Certified
Entity:i. If at Certification theCertified Entity followed
the revenue share basis forcompliance with theCertification threshold (seeClause C.2.3) andsubsequently increased
the revenue of any
economic activity of theCertified Entity that did notprevious contribute to theCertified Entity meetingthe compliance threshold,To obtain Certificationn/a
For subsequent annual verifications
If, since the last verification
engagement, the revenue share ofany existing part of the Certified
Entity activities that did notpreviously contribute to the Certified
Entity meeting the Certification
Threshold has increased,
demonstration of compliance with
the Certification threshold supportedby the latest audited financial
statements and/or independently
verified/ audited management
reporting.

For guidance on (re)assessing compliance with
the Certification Threshold, see Clause C.2.3
Obtaining Entity Certification.

Criteria as written in PART C of the Climate Bonds
Standard v4.0
then the Applicant has reassessed its compliancewith the Certification
Threshold and theCertified Entity still meets
the Certification Threshold(per Clause C.2.3).
ii. All interim Climate
Mitigation Performance
Targets (per Clause
C.3.1.1) and all interim
milestones in the Delivery
Strategy (per Clause C.3.2)
falling due since the lastverification engagement
have been met. The only
exception to this may be
where compensatory
measures have been taken
or are planned to address
underperformance andthose measurescollectively meet therequirements in Clause
C.3.3; andiii. Any and all correction
measures have been taken
to address any anticipatedunderperformance in thedelivery of the Delivery
Strategy and future interim
Climate Mitigation
Performance Targets meetthe requirements in Clause
C.3.3; andiv. All disclosure requirements
have been met (per Clause
C.5)
andThe Parent Group remains incompliance (per Clauses C.4
and C.5)
and
The Applicant must not be
subject to revocation of
Certification due to any of theevents described in Box C2
andThe Applicant supplies the
Climate Bonds Standard Board,
through the Climate Bonds
Standard Secretariat, withcopies of the annual
Verification Reports or shares
their location on a public
website, for the purpose of
publishing on the Climate
Bonds Initiative website.

Certification Checklist
Compliance with all the ‘For
subsequent annual verifications’requirements documented under
Clauses C.3, C.4 and C.5.

Additional guidanceCriteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

Box C2:
Revocation of
EntityCertification

To obtain Certification

Events triggering a necessary reapplication for
Certification include but are not limited to:acquisitions or mergers by the Certified Entity.

Entity Certification will also be
rescinded at any time where:
1. The Applicant becomesaware that the Certified
Entity and/ or the Parent
Group no longer conforms
with the Climate Bonds
Standard and provides a
written statement to that
effect to the Climate
Bonds Standard
Secretariat; or
2.

3.

A Verification
Engagement
commissioned by the
Climate Bonds Standard
Board, finds that theCertified Entity and/ or
the Parent Group nolonger conforms with the
Climate Bonds Standard;or
The Applicant hasbreached any contractual
obligation towards the
Climate Bonds Initiative.

n/a
For subsequent annual verifications
n/a

Example: At the time of certification, 100% of
the Certified Entity’s revenue came from steel
production. Two years later the Certified Entity
acquires and gains operational and financial
control over a revenue generating cement
production facility. In this case, a redefining of
the Certified Entity and its business activities
would be required, to ensure it continues tomeet all the requirements for Certification. If
not, Certification will be revoked.
If reapplication for Certification is being made,compliance must be to the Climate Bonds
Standard (including the Climate Bonds Standard
Sector Criteria) in force at the time ofreapplication, not the Standard in force at thetime of initial Certification.
Contractual obligations to Climate Bonds include,
but are not limited to, reporting requirements,
payment of the certification fee in accordancewith the Climate Bonds Certification Fee Policy.

In addition, if the Certified
Entity has undertaken new
economic activities in addition
to those previously taken into
account when assessing
compliance with theCertification Threshold (perClause C.2.3.), the Applicant
must re-apply for certification
within 12 months of the startof the new economic activity.
This new application must
consider the new, expanded
economic activities of theCertified Entity. If
reapplication is not made or is
not compliant with this PARTC of the Standard, the existing
Entity Certification will be
revoked.
C.3 TRANSITION PLAN FOR COMPLIANT ACTIVITIESFor each of the economic
activities of the Certified Entity
identified per Clause C.2.3., allof the following requirements
must be met for it to bedeemed a Compliant Activity.

A Transition Plan is a time-bound and trackablestrategy and roadmap presenting the plans andactions for reducing emissions to achieve thefuture Climate Mitigation Performance Targets,and the assumptions underpinning it.
It should demonstrate that the Certified Entity
has identified viable activities in a low-carbon
economy that it intends to engage in, and that
action plans and mechanisms are being put inplace to deliver the transition in line with the
Climate Mitigation Performance Targets set, andCriteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance
this transition has been fully integrated into theentity’s wider business model and forward plans.
The Plan must include the elements detailed
here but need not be limited to them. However,any additional elements beyond those detailed
here will not be within the scope of Certification
and Certification confers no assurance overthem.
Specifically, if the Transition Plan includes
Performance Targets beyond climate mitigatione.g., relating to social goals or biodiversity, wateror other environmental goals are not assessed
under the Climate Bonds Standard, andCertification confers no assurance over those
Performance Targets or any associated Delivery
Strategy or governance structure.

C.3.1 CLIMATE PERFORMANCE
C.3.1.1. Climate
Mitigation
Performance
Targets

3.1.1.1. Time horizon
The Climate Mitigation
Performance Targets cover thetime from the date ofcertification to the date theactivity is intended to hit net
zero emissions, or 2050,
whichever is sooner.
3.1.1.2. Interim Climate
Mitigation Performance
Targets
The Climate Mitigation
Performance Targets include
interim targets on a threeyearly basis for the five-year
term of Certification and a fiveyearly basis thereafter over thefull time horizon described in
Clause C.3.1.1.1
3.1.1.3. Alignment withdecarbonisation pathways of
the Climate Bonds Standard
The interim Climate Mitigation
Performance Targets (perClause C.3.1.1.2) arebenchmarked against theclimate mitigation criteria in
the Climate Bonds Standard
Sector Criteria and align withthose criteria by 2030 at thelatest.
N.B. Different levels of Entity
Certification are awarded
depending on the date the
Climate Mitigation
Performance Targets align with
the Climate Bonds Standard
Sector Criteria – see Box C4.
3.1.1.4. Board approval

To obtain Certification
Documented Climate Mitigation
Performance Targets meet therequirements laid out in Clauses
C.3.1.1.
Board minutes and related
documents not older than 12 months
from the application for Certification
documenting approval of the Climate
Mitigation Performance Targets thatmeet the requirements.
The sole exceptions to this are if:- The Climate Bonds Standard
Sector Criteria do not ratchet
down over time (i.e. the criteria
are static over time), and theactivity already meets thosecriteria.
- The Climate Bonds Standard
Sector Criteria do ratchet downover time, but the activity isalready at net zero emissions.
In these cases the requirement for
Board approval can be waived.

For subsequent annual verifications
Any interim Climate Mitigation
Performance Targets falling due
since the previous annual verification
engagement have been met.
Or, for any interim Climate
Mitigation Performance Targets thathave not been met, corrective
actions are being taken to address
this within 12 months (in line with
Clause C.3.3.3)
If Climate Mitigation Performance
Targets have been reset since the

A list of the Climate Bonds Standard Sector
Criteria available for the purposes of Entity and
SLD Certification is available here. There is nocross-sectoral pathway. If criteria for a sector do
not exist, then that sector/ activity cannot form
part of the Certified Entity, unless it forms part ofthe 10% outside of the Certification Threshold
per Clause C.2.2.
The Climate Mitigation Performance Targets
need not be limited to but must address all
metrics and criteria listed in the relevant Climate
Bonds Standard Sector Criteria. These elements
include pathways of GHG emissions intensity
metrics that take into account all material scope
1, 2, and 3 emissions in all cases, and for some
activities may also include other quantitative or
qualitative indicators and requirements. See theappropriate Climate Bonds Standard Sector
Criteria for details.
Carbon credits or avoided emissions may be
used in addition to achieving alignment with the
Climate Bonds Standard Sector Criteria but
cannot be used as a means to achieve alignment
with those Sector Criteria and do not form partof the scope of this assessment.
For a definition of the Board, see Clause C.4.1.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Box C4: Twolevels of Entity
Certification

Certification Checklist

The Board of the Certified
Entity has approved the
Climate Mitigation
Performance Targets no earlier
than one year prior toapplication for Certification.

previous verification engagement (inline with Clause C.3.3.2), those reset
targets meet the ‘To obtain
Certification’ requirements above.

Two levels of Entity
Certification are available,
depending on when the
Climate Mitigation
Performance Targets align with
the Climate Bonds Standard
Sector Criteria.
Level 1 – “Aligned”: The
Climate Mitigation
Performance Targets alignwith the Climate Bonds
Standard Sector Criteria at
the time of certificationand thereafter until thedate the Climate Mitigation
Performance Targets
represent net zero
emissions or 2050,
whichever is sooner.
Level 2 – “Transition”: The
Climate Mitigation
Performance Targets do
not align with the Climate
Bonds Standard Sector
Criteria at the time ofcertification but align by2030 and thereafter until
the date the Climate
Mitigation Performance
Targets represent net zero
emissions or 2050,
whichever is sooner.

n/aAdditional guidance

Board minutes document Board signoff of any reset Climate Mitigation
Performance Targets reset since theprevious verification engagement.
If less than 90% of the Certified Entity’s activities
meet Level 1 requirements at the time ofcertification, but more than 90% meet Level 2
requirements, the Certified Entity will be eligible
only for Level 2 certification.
If performance levels improve and Climate
Mitigation Performance Targets and the Delivery
Strategy are subsequently reset during the termof Certification such that the Certified Entity
subsequently attains the 90% threshold requiredfor Level 1, then certification can be ‘upgraded’
from Level 2 to Level 1 certification. This issubject to audited verification of this improved
performance and reset Climate Mitigation
Performance Targets and a Delivery Strategy thatmeet the requirements of Clauses C.3.1.1. andC.3.2 respectively.
Under Level 2, ‘align by 2030’ means alignment
with the thresholds of 2030 by 2030, notalignment with the thresholds at the time ofcertification by 2030.

In addition, for both levels, theDelivery Strategy andgovernance for achieving those
Climate Mitigation
Performance Targets meets therequirements described in
Clauses C.3.2. and C.3.3.
respectively, the Parent Group
complies with therequirements described in
Clause C.4 and the disclosure
requirements of Clause C.5 aremet.
C.3.1.2. Climate
Adaptation &Resilience
Performance

The economic activity complies
with any Climate Adaptation &Resilience Criteria specified in
the relevant Climate Bonds
Standard Sector Criteria.

To obtain Certification
Any requirements documented
under ‘Climate Resilience Criteria’ in
the Climate Bonds Standard Sector
Criteria

Not all Climate Bonds Standard Sector Criteria
have Climate Adaptation and Resilience Criteria
at this time. If this is the case, then Clause
C.3.1.2 can be ignored.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

For subsequent annual verifications
Any requirements documented
under ‘Climate Resilience Criteria’ in
the Climate Bonds Standard Sector
Criteria
C.3.2. DELIVERY STRATEGY
C.3.2.1. Board
approval of the
If a Delivery Strategy is
Delivery Strategy required for the economic
activity*, that Strategy:•
Includes all theelements listed in
Clauses C.3.2.2. andC.3.2.3.; and•Has been approvedby the Board of theCertified Entity no
more than one year
prior to theapplication for
Certification.
* See supplementary guidance
for the list of economic
activities that do/ do not
require a Delivery Strategy.

C.3.2.2
Foundations
C.3.2.2.1. Vision

The Delivery Strategy includes
the following foundational
elements
A Vision outlining the strategic
objectives and priorities of thetransition, outlining what theCertified Entity will look like interms of its future activities,
physical assets and businessmodel that align with the longterm Climate Mitigation
Performance Targets of Clause
C.3.1.1.

To obtain Certification
The Delivery Strategy addresses andis tailored to all the activities of theCertified Entity that are to be
counted towards compliance with
the Certification Threshold (seeClause C.2.3.)
Board minutes and related
documents documenting Board
approval of the Delivery Strategy andall the supporting documents inClause C.3.2., dated within one yearof the date of the application for
Certification.
For subsequent annual verifications

In essence, activities for which emissions are
already near net zero do not require a Delivery
Strategy. See supplementary guidance for the listof activities that do/ do not require a Delivery
Strategy here.
If the Delivery Strategy encompasses a numberof different economic activities that collectively
form all or part of the Certified Entity, each
Compliant Activity (per Clause C.2.3) must be
clearly addressed and identifiable within each of
the elements of the (combined) Delivery Strategy
described below, so that is it clear how the
Climate Mitigation Performance Targets for that
activity will be delivered.
For a definition of the Board, see Clause C.4.1.

Board minutes document Board
approval of any Delivery Strategy
reset since the previous verification
engagement.

To obtain Certification
For each Compliant Activity of theCertified Entity, the Vision describes:
-

-

-

-

The evolved product and/ orservice that will deliver the
long-term Climate Mitigation
Performance Targets.
The future operating modeland supporting asset base thatwill underpin this.
The associated priorities todeliver the long-term Climate
Mitigation Performance
Targets.
Any future reliance on newtechnologies and changed
policies.

The Vision is compatible with thelong term Climate Mitigation
Performance Targets see Clause
C.3.1.1.
The Vision is compatible withdisclosures made in sustainability
reporting and wider TCFD reportingof the Certified Entity. In particular, it
responds to the climate-related risks
and opportunities identified by the

The Vision will be specific to the context of theactivities of the Certified Entity. Factors to beconsidered include investments in low-GHG
technologies, any phasing out or other disposal
or assets or activities that cannot be
decarbonised, value chain engagement activities
and lending or investment objectives.
As carbon credits or avoided emissions may not
be used to achieve alignment with Climate Bonds
Sector Criteria, the role of any carbon offsets,
carbon removals and avoided emissions theCertified Entity anticipates employing to address
any residual emissions over and above thoserequired to meet the Climate Bonds Standard
Sector Criteria should be clearly demarcated.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidanceCertified Entity through TCFD
reporting processes.
For subsequent annual verifications
Any amendments to the Vision since
the previous verification engagement
meet the ‘To obtain Certification’requirements as described above.
C.3.2.2.2.
Strategic
Narrative

A Strategic Narrative describing
how each of the Compliant
Activities of the Certified Entity
will evolve from their current
position to the Vision of Clause
C.3.2.2.1., taking into accountbusiness context.

To obtain Certification
Content of the strategic narrative
For each activity of the Certified
Entity, the strategic narrativedescribes:
a. Current GHG emissions, inabsolute emission terms and anyother metrics such as emissions
intensity detailed in the Climate
Bonds Standard Sector Criteria.
Including information on thecurrent sources of GHG emissions
and how and by whom this has
been calculated and verified.
b. The nature and timing of
decarbonisation levers to bepulled and a quantification of
their emissions reduction(identifying any potential
emissions trade-offs). These toinclude but not be limited to:i. Changes to the structure of
the Certified Entity,
including any organic
growth, mergers andacquisitions, divestments orretirements
ii. Changes in the Certified
Entity’s product and service
portfolioiii. Adoption of any newtechnologies
iv. Changes in supply chain
relationships.
c. The assumed market trends,
business growth, pricing anddemand underpinning thetransition as well as regulatoryand government policy
assumptions. This includes how
climate change risks andopportunities have been
incorporated.
d. The key internal and external risks
and barriers that the Certified
Entity faces and the potential
impact on specificdecarbonisation levers.
e. Key sources of uncertainty inestimation, assumptions or
outcome.
f. The source and significance of any
locked-in GHG emissions.

The content of the Strategic Narrative will be
specific to the Certified Entity according to theirbusiness context, such as relevant region-specificconsiderations, organization size and market
position, operating model.
However, where the appropriate Climate Bonds
Standard Sector Criteria include key actions thatwould be required for Certification these must
be incorporated into the decarbonisation leversof the narrative strategy.
Depending on the nature of the decarbonisation
lever, external evidence may include academic
studies, third party expert verification, evidence
from comparable action taken in similar
circumstances, contractual undertakings,
government or regulator undertakings or
established market trends.
The scopes and sources of GHGs addressed in
the Climate Bonds Standard Sector Criteria must
be included in the estimation of current GHG
emissions. Methodologies to estimate emissions
must follow those outlined in the Climate Bonds
Standard Sector Criteria.
The strategy may rely on nascent or mostly
existing or incremental technology
improvements. In the former case a greater bodyof evidence is required to support theassumptions made in respect of the anticipatedresulting emissions reductions.
In particular, where the strategy relies on
nascent technologies the narrative is supported
by external assessment of the technologicalreadiness and potential emissions reductions
over time of the technology, and evidence that
exploration of the technology has started, suchas pilot projects. Strategies may not rely on nonexistent or non-proven technologies.
Where decarbonisation is dependent on
regulatory or government policy or changes in
consumer demand, assumptions are consistent
with known policies, market trends oranticipated scenarios from credible third parties.
Key growth business areas are not in
geographies with unsupportive policy and other
unsupportive conditions without addressing thecompensatory factors which override those
unsupportive conditions.
Where decarbonisation is assumed to be passive
this should be clearly indicated, and supportive
evidence provided for those external factors. For

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidanceg. How the Certified Entity will
embed the strategic ambition of
its Transition Plan in its wider
business model, highlighting key
implications for products andservices, resourcing andoperational and capital
expenditure, acquisitions ordivestments.

example, for decarbonisation of the grid, via
globally recognized energy decarbonization
scenarios that take into account the plans andcommitments of those responsible for the grid.

The Strategic Narrative breaks thetimeline down into 3-yearly intervals
to 2035, and a 5-yearly basis
thereafter until the earlier of thetarget date for net zero and 2050.
Robustness
The decarbonisation levers arebroadly consistent with those of net
zero pathways for the sector.
The plausibility of this strategic
narrative is supported by external
evidence regarding the feasibility andtiming of the decarbonisation levers
and their estimated impact onemissions. Material deviations are
explained and supported. If expected
emissions reductions aresubstantially larger when comparedto similar measures adopted
elsewhere, reasonable explanationmust be given to justify this. Overall
the evidence base is appropriate,
complete and accurate.
Quantitative future outcomes arecalculated on the basis of the given
scenarios, assumptions, base dataand other information.
The timing and anticipated emissions
reductions of the decarbonisation
levers are compatible with the(interim) Climate Mitigation
Performance Targets per Clause
C.3.1.1.
Reporting consistency
The Strategic Narrative is compatible
with disclosures made insustainability reporting and any
wider TCFD reporting of the Certified
Entity. In particular, it responds tothe climate-related risks andopportunities identified by the
Certified Entity through any TCFD
reporting processes.
For subsequent annual verifications
The strategic narrative described iscompatible with made in any post

Where decarbonisation is dependent on
reducing emissions in its value chain, evidence
will be required to support the assumed capacityof the Certified Entity to influence its value chain.
For example, entities may have greater influenceon their suppliers when their orders account fora meaningful share of the suppliers’ business andwhen multiple sourcing alternatives exist. A
reliance on large, publicly listed suppliers may
also facilitate the adoption of ambitious
emissions reduction compared to small and midsized companies (SMEs). Greater concentrationin the supplier base can also support value chain
decarbonization efforts as it may be easier toengage and coordinate emissions reduction
actions.
Potential emissions trade-offs might include
possible increases in short-term emissions that
result from actions that are necessary fordelivering long-term emissions reduction acrossthe operations.
Variations in assumptions around prices, theexistence of product substitutes and regulatory
policies (e.g., subsidies for low-carbon products
or taxes on more carbon-intensive substitutes)
can materially impact the future acceptance of
low-carbon products by customers and thus raisequestions about the robustness of the Strategic
Narrative.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

certification sustainability reporting
and any wider TCFD reporting of theCertified Entity.
Any amendments to the Strategic
Narrative since the previous
verification engagement meet the‘To obtain Certification’requirements as described above.
C.3.2.3.6.
Broader social
andenvironmentalalignment

A position statement aligning
the Vision and Strategic
Narrative of Clauses C.3.2.2.1
and C.3.2.2.2. with theCertified Entity’s broader
environmental and social
objectives, strategies and/ or
policies, in particulardemonstrating that effects on
biodiversity sensitive areas,
emissions to water andhazardous waste have beentaken into account.
In addition, the Certified Entity
is not subject to a complaint to
a National Contact Point of theOECD regarding Responsible
Business Conduct ofMultinational Enterprises.

To obtain Certification
The position statement meets therequirements of Clause C.3.2.3.6.
This includes addressing whether
and if so, how the alignment with theCertified Entity’s broader
environmental and social objectives
considers any contribution to theJust Transition in the region in which
the activities are carried out.
Risks of negative environmental orsocial externalities related to themain actions supporting the Vision
and Strategic Narrative have been
identified and monitoring systems
are in place to monitor those risks
and escalate mitigation orcompensation measures if theexternalities materialise.

These broader environmental and social
objectives, strategies and policies should relate
to the Certified Entity’s ESG objectives andpolicies, obligations under any sustainability
reporting requirements and/ or regulations.
At this time, this guidance does not define a Just
Transition or the requirements for how aTransition Plan incorporates a Just Transition.
This can be done by the Applicant usingwhatever tools, frameworks or methodologies as
it deems appropriate. As a broad definition, aJust Transition would be the delivery of anet zero and climate-resilient economy in a waythat delivers fairness and tackles inequality andinjustice.

Confirmation that the Certified Entity
is not subject to a complaint to a
National Contact Point of the OECD
regarding Responsible BusinessConduct of Multinational
Enterprises.
For subsequent annual verifications
Evidence that the risks of social andenvironmental externalities are being
monitored and acted upon.
C.3.2.3
Implementation
plans

Implementation plans include
the following.

C.3.2.3.1. Action
Plan for Scope 1& 2 Emissions

A time-bound plan of the
trackable actions the Certified
Entity will take or is taking to
implement its decarbonisation
strategy as described in the
Vision and Strategic Narrative
and thereby deliver its Climate
Mitigation Performance
Targets regarding scope 1 & 2
emissions.
This includes interim
milestones and metrics
annually for the five year
period of certification, threeyearly for the subsequent nine

To obtain Certification
For each decarbonisation leveridentified in the Strategic Narrative
relating to scope 1 or 2 emissions,the documented Action Plan
identifies a schedule of actions (aroadmap) that will deliver that lever.
For each decarbonisation lever andassociated schedule of actions,interim milestones and business andoperational metrics are identified forthe purpose of monitoring deliveryof the Action Plan, per the schedule
described in Clause C.3.2.3.1.
The documented actions are broadly
consistent with those of peers

The Action Plan will be specific to the Certified
Entity. However, where the appropriate Climate
Bonds Standard Sector Criteria include key
actions and/ or business or operational metrics
that would be required for Certification thesemust be incorporated into the Action Plan.
Key milestones are one-off actions to beundertaken. They must be sufficiently granularthat progress can be assessed annually.
For example, if the decarbonisation lever is the
deployment of a new technology, the Action Planshould detail the steps taken to develop anddeploy that technology, from investments in
R&D, patent registering, pilot projects, scaling
projects etc. Not simply state that thetechnology will be deployed ten years hence.

Criteria as written in PART C of the Climate Bonds
Standard v4.0
years and a five-yearly
thereafter.
N.B. This is only required if therelevant Climate Bonds
Standard Sector Criteria
address scope 1 and/or scope 2
emissions.

Certification Checklist
targeting similar decarbonisation
levers. Material deviations are
explained and supported.
The plausibility of the actions is
supported by external evidence
regarding the feasibility and timing of
the proposed action and its
estimated impact on emissions.
Collectively, the actions identified in
the Action Plan can plausibly be
expected to deliver the
decarbonisation levers described in
the Strategic Narrative.
For subsequent annual verifications
The interim milestones and metrics
falling due since the previous annual
verification engagement have beendelivered/ met.
Or, for any milestones or metrics
that have not been met, thecorrective actions being taken toaddress this within 12 months (in linewith Clause C.3.3.)
Any amendments to the Action Plan
since the previous verification
engagement meet the ‘To obtain
Certification’ requirements as
described above.

Additional guidance

Likewise, if the decarbonisation lever is a switch
to renewable energy, the Action Plan should
detail the steps taken to source that energy,
such as intentions for and source of renewableenergy certificates (RECs) and / or purchasing
power agreements (PPAs) and as well as any
action to install and operate on-site generation.
The actions must be concrete. Vague
descriptions such as ‘accelerate our transition tocleaner energy solutions’, ‘modernize ouroperations’ or ‘leverage green solutions’ without
a description of the specific actions that will betaken, and the impact of those actions are noteligible.
Depending on the nature of the action, plausible
evidence of the expected impact of the actions
identified in the Action Plan may include
academic studies, third party expert verification,evidence from comparable action taken insimilar circumstances, contractual undertakings.
Business and operational metrics are crosscutting targets that can be used to assess overall
progress in the implementation of the Action
Plan. For example, % of product sold that is low
carbon, % energy from renewable sources/
emissions intensity of energy used/ total
emissions of energy used, % of recycled source
materials etc.
These milestones and metrics together addressand enable the tracking of all key actions
identified in the Action Plan as necessary todeliver the decarbonisation levers.
Plausible evidence of the interim actions being
taken and/ or interim metrics and milestones
being met will vary but might include
management reports, Board papers, audited
sustainability reports, public announcements,
evidence of capital expenditure or contracted
services or equipment, sales contracts.

C.3.2.3.2. Action
Plan for Scope 3
Emissions

A time-bound plan of the
trackable actions the Certified
Entity will take or is taking to
implement its decarbonisation
strategy as described in the
Vision and Strategic Narrative
and thereby deliver its Climate
Mitigation Performance
Targets regarding scope 3
emissions.
This includes interim
milestones and metrics
annually for the five year
period of certification, threeyearly for the subsequent nine
years and a five-yearly
thereafter.

To obtain Certification
The documented Action Plan
describes:
i. Clear objectives for value chain
engagement that align with value
chain related decarbonisation
lever(s) identified in the Strategic
Narrative. These objectives
address the desired behaviours or
results or outputs from value
chain partners, and the expected
contribution to the delivery of therelevant decarbonisation lever(s).
ii. The granular actions to be taken
to achieve these objectives, withidentified trackable interim
milestones and metrics to enable

The Action Plan for Scope 3 emissions is aroadmap for engagement with downstream andupstream entities in the Certified Entity’s value
chain e.g. suppliers, distributors, final customers
and portfolio companies.
The Action Plan should identify avenues throughwhich the Certified Entity has significant
influence on their suppliers or customers.
Appropriate actions and associated milestones
and metrics will vary by Certified Entity.
Examples include:- % of procurement from no- or low GHG
suppliers.
- Implementing a sourcing governance policy
or framework ensuring new supply chain
partners are compatible with the objectives

Criteria as written in PART C of the Climate Bonds
Standard v4.0
N.B. This is only required if therelevant Climate Bonds
Standard Sector Criteria
address scope 3 emissions.

Certification Checklist
the monitoring and assessment ofprogress per the schedule
described in Clause C3.2.3.2.
iii. An escalation process andmitigation action that will betaken should value chain
stakeholders show little orinsufficient response toengagement and/ or interim
milestones and metrics are notmet. In particular, if the plan isfully or partially reliant on
partners setting their own
compatible emissions reduction
targets, it is accompanied by amechanism for assessing theveracity of any partner emissions
reduction claims and a
description of and timeframe forthe compensatory action that will
be taken if partners do not set or
achieve their own emissions
targets.

Additional guidancedescribed in the Action Plan for Scope 3
emissions.

The timing and anticipated emissions
reductions of the engagement
actions described in the Action Planfor Scope 3 emissions can plausibly
be expected to deliver the associateddecarbonisation levers identified in
the Strategic Narrative.
For subsequent annual verifications
The interim milestones and metrics
falling due since the previous annual
verification engagement have beendelivered/ met.
Value chain partners brought onsince the development of any low
carbon procurement policy or similar
have been comply with the terms ofthat policy. This may be evidenced
via contractual agreements withthose partners.
Any amendments to the Action Planfor Scope 3 emissions since theprevious verification engagement
meet the ‘To obtain Certification’requirements as described above.
C.3.2.3.3.
Finance plan

A Finance Plan detailing thefinancial implications of theStrategic Narrative and Action
Plans, and the trackable actions
being taken/ to be taken todeliver this Finance Plan.
This includes interim
milestones and metrics
annually for the five year
period of certification, threeyearly for the subsequent nine

To obtain Certification
The Finance Plan for the delivery of
the Climate Mitigation Performance
Targets addresses-

The costs (CapEx and potentially
OpEx), revenue impacts andother balance sheet impacts ofimplementing the Strategic
Narrative and associated Action
Plans.

The details of the Finance Plan will be specific to
the Certified Entity. However, the following
guidance applies to all.
Financial considerations typically have greater
bearing for sectors that are capital-intensive or
where transition plans are expected to involve
very significant investments and costs. Certified
Entities whose transition to lower emissions does
not entail significant costs would likely provide
fewer details on financial strategy.

Criteria as written in PART C of the Climate Bonds
Standard v4.0
years and a five-yearly
thereafter.

Certification Checklist

Additional guidance-

Costs relate to the investments (CapEx) andoperational costs (OpEx) needed to deliver the
Climate Mitigation Performance Targets.
Examples include R&D or investment costs in
new technologies or infrastructure, site
remediation, contract penalties, regulatory costs,
restructuring costs, higher supplier prices arisingfrom the transition, long-term utilities savings
from investment in renewable energy assets.
They must address all current, committed andanticipated impacts.

-

-

-

The planned sources of funding
to cover these costs.
An assessment of how thefinancial impacts describedabove will impact the overall
financial metrics of the Certified
Entity and any implications forthe ongoing financial viability of
the Certified Entity.
Identification of metrics thathave significant estimation
uncertainty, noting the sources
and nature of the estimation
uncertainties and the factors
affecting the uncertainties.
Financial milestones and target
metrics that can be monitored
to track progress in the deliveryof the Finance Plan per theschedule described in ClauseC3.2.3.3.

This Finance Plan incorporates
detailed financial budgets for firsttwo years. Higher level estimates andprojections may be used over thesubsequent three to five years.
Beyond that, estimates andprojections will be broader and into
the longer term represent more abroad conceptualization of possible
financial pathways.
The costs estimated in the Finance
Plan are reasonably sized compared
to sector peers and/ or the overallplausibility of the Finance Plan is
supported by external evidence fromcredited third party sources. Material
deviations are explained andsupported. If expected costs orrevenue impacts are substantiallydifferent when compared toequivalent estimations elsewhere,reasonable explanation is given tojustify this.
Assumptions on growth, market
demand for products, prices andcosts related to future business mix
are broadly aligned with industry
trends, and the plan adequately
justifies an expectation ofcommercial viability.
Quantitative future outcomes arecalculated on the basis of given
scenarios, assumptions, base dataand other information and reflect
the uncertainties and sensitivities
identified in the Strategic Narrativeand Sensitivity Analysis

Revenue impacts must include the positive
and/or negative impacts from changed productor service offerings and/ or the prices of thoseofferings.
Balance sheet impacts must address balance
sheet and cash flow impacts. For example
revised asset values/ write-downs.
Target metrics that can be tracked over timemight include:- % of the Certified Entity’s capital expenditurealigned with the strategic narrative- % of the Certified Entity’s R&D aligned with
the Strategic Narrative- % of the Certified Entity’s asset base alignedwith the products/ services described in thevision- % of the Certified Entity’s revenue alignedwith the products/ services described in thevision.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

The selected milestones and target
metrics are clearly linked to thedelivery of the Finance Plan andrepresentative of all aspects of it andcan be tracked over time.
There is no material uncertainty
related to the capacity of theCertified Entity to finance thetransition represented by the
Climate Mitigation Performance
Targets, either due to likely
underestimation of costs or weakfinancial profile compared to the
expected expenditures involved,
estimated sources of finance, andtheir timing.
The Certified Entity’s projected asset
base does not indicate a lock-in tohigh carbon impact technologies thatis inconsistent with the attainment of
the Vision and Strategic Narrative.
Financial data and assumptions are
consistent with and integrated into
the corresponding financial data andassumptions in the Certified Entity’s
financial statements in accordancewith the relevant accounting
standard.
For subsequent annual verifications
The interim milestones and target
metrics falling due since the previous
annual verification engagement havebeen delivered/ met.
Or, for any milestones or target
metrics that have not been met, thecorrective actions being taken toaddress this within 12 months (in linewith Clause C.3.3.).
The Financial Plan is compatible withany financial statements issued post
certification.
Any amendments to the Financial
Plan since the previous verification
engagement meet the ‘To obtain
Certification’ requirements as
described above.
C.3.2.3.4.
Internal policyalignment

Information on the key internal
policies developed or to be
developed to enable thedelivery of the Climate
Mitigation Performance
Targets, Strategic Narrative,
Action Plans and Finance Plan,
explaining how each of thesepolicies supports specificelements and milestones in theStrategic Narrative and Action
Plans and Finance Plan.

To obtain Certification
Documentation of the key internal
policies that need to be developed todeliver the Climate Mitigation
Performance Targets.
For each policy, the following is
described:-

The objective of the policy.
The activity to which it relates.

Key policies and conditions will vary according to
the Certified Entity and its activities. They may
cover operational, financial or any other aspectsof the transition.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist--

Additional guidance

How it supports the delivery of
the Climate Mitigation
Performance Targets, linking it
to elements in the Strategic
Narrative / Action Plans and/or Finance Plan.
A schedule for its development
and implementation, withannual trackable milestones.

For subsequent annual verifications
The trackable milestones have been
met. Or, for any trackable
milestones that have not been met,
an explanation is given of how thiswill not affect the delivery of the
Action Plan/ Finance Plan/ Climate
Mitigation Performance Targets, orcorrective actions have been
identified and are being
implemented to address thisunderperformance within 12 months(in line with Clause C.3.3.).
C.3.2.3.5.
Sensitivity
analysis

Sensitivity Analysis identifying
the key sensitivities and risks to
the Vision, Strategic Narrative,
Action Plans and Finance Plan
that have the potential todecisively impact the deliveryof the Climate Mitigation
Performance Targets.

To obtain Certification
The key sensitivities and risks aroundkey assumptions underpinning the
Vision, Strategic Narrative, Action
Plans and Finance Plan andultimately the delivery of the Climate
Mitigation Performance Targets are
identified.
Sensitivity analyses has been
performed on plausible variations ofthese key assumptions and theimpacts of these are quantified in
respect of estimated impacts on thelikelihood, timing and/ or costs ofdelivery of the Climate Mitigation
Performance Targets.
For subsequent annual verifications-

Key sensitivities and risks will be specific to theCertified Entity, depending on their activity, sizeand location among other factors. At a minimum,
consideration should be given to key sensitivities
and risks relating to:o Policy and regulatory change e.g. how policy
o
o

o
o
o

and regulatory change will subsidise the costof investments.
Technological developments e.g. reliance on
new technologies and the timing and cost of
their roll out
The physical impacts of the current andforecast changing climate e.g. how changing
precipitation patterns and may impact accessto water required for operations.
Shifts in client and consumer demand e.g. thelevel of demand for products or services thatthe company is not currently providing.
Operating environment change e.g.
decarbonisation of the grid.
Supply chain considerations, scarcity/pricesof key inputs

C.3.3. GOVERNANCE
The following accountability
mechanisms are in place togovern the delivery of the
Climate Mitigation
Performance Targets and any
associated Delivery Strategy.
C.3.3.1. Boardand senior
executive
responsibility

C.3.3.1.1. Board mandate
The Board (or equivalent
governance body) has a clear
mandate to:•Oversee the selection of
the Climate Mitigation
Performance Targets andTo obtain Certification
The Terms of Reference, mandate
and related policies for the Board (orequivalent governance body) of theCertified Entity reflect the four
elements noted in Clause C.3.3.1

The Board or equivalent governing body means:• The Board• A named, specific, Board committee• An executive or committee that reports on
this directly to the Board or to a Board-levelcommittee.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

•

•

•

development of the
Delivery Strategy; andApprove the Climate
Mitigation Performance
Targets and Delivery
Strategy; andOversee the execution
and monitor progresswith the Delivery
Strategy; andApprove and monitor
any corrective actions
required where interim
Climate Mitigation
Performance Targets andDelivery Strategy
milestones are not beingmet.

C.3.3.1.2. Senior management
responsibility

C.3.3.2.
(Re)setting andmonitoring the
ClimateMitigation
Performance
Targets andDelivery Strategy

Certification Checklist
There is a named board member or
executive with explicit responsibility
for the Certified Entity’s response to
climate change.
This person has climate change
expertise and/ or the Board engages
external experts to advise on climate
and other related technical matters.
Board minutes document receipt anddiscussion of regular status reportson the design of the Delivery
Strategy, execution of the Delivery
Strategy, and corrective measuresneeded in respect of delivery of the
Climate Mitigation Performance
Targets and implementation of the
Delivery Strategy, as per thedisclosed information on thefrequency of Delivery Strategy
review and monitoring.

Senior management has
responsibility for execution of
the Delivery Strategy, and the
responsible parties haveauthority and access toresources to ensure execution.

For subsequent annual verifications

C.3.3.2.1.(Re) setting Climate
Mitigation Performance
Targets and the Delivery
Strategy

To obtain Certification

Tools and mechanisms are inplace for the (re) setting ofrobust Climate Mitigation
Performance Targets and the
Delivery Strategy, including afull review and, if necessary,
update of the Climate
Mitigation Performance
Targets and Delivery Strategy
at least every five years.
C.3.3.2.2. Tracking andmonitoring delivery
Tools and mechanisms are inplace for tracking andmonitoring of delivery ofinterim Climate Mitigation
Performance Targets and themilestones and metrics
identified in the Action Plans
and Finance Plan.

Additional guidance

Board minutes since the previous
verification engagement document
receipt and discussion of regular
status reports on the design of the
Delivery Strategy, execution of the
Delivery Strategy, and corrective
measures needed in respect ofdelivery of the Climate Mitigation
Performance Targets and Delivery
Strategy, as per the disclosed
information on the frequency ofDelivery Strategy review andmonitoring.

An internal control system is in placein relevant internal assurancefunctions in which there is:
1. A documented process for (re)setting the Climate Mitigation
Performance Targets and the
Delivery Strategy at least every
five years, including identificationof internal controls established toprevent, or detect and correct
inappropriate or erroneous
inputs, or computational errors in
the compilation of the financeplan, and ensure the underlying
base data is complete andaccurate.
2. An information system forobtaining, processing andcommunicating relevant dataand information of sufficientquality to enable monitoring of
progress in the delivery of theinterim Climate Mitigation
Performance Targets andinterim milestones and target

This internal control system may include aninternal audit system.
Climate Mitigation Performance Targets should
be reset and/ or Delivery Strategy adjusted, as
needed, to reflect significant changes within or
external to the business that could compromise
relevance and consistency of the existing target
or delivery strategy. This re-evaluation andrecalibration must reflect changing operating
conditions and market developments, such as
new technologies coming online sooner than
expected.
Any Climate Mitigation Performance Targets
and/ or Delivery Strategy reset during the periodof Certification must comply with the Standard(including Climate Bonds Standard Sector
Criteria) in force at the date of initial
Certification, not the Standard in force at thetime of reset.
Tracking and monitoring processes should be
adequate to identify in a timely manner:- Actual underperformance against the interim
Climate Mitigation Performance Targets

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist
metrics identified in the Action
Plans, and the ongoingappropriateness of theassumptions underpinning the
Vision and Strategic Narrative,
including those highlighted in
the Sensitivity Analysis as posing
significant risks to the executionof the Delivery Strategy.
3. A central record of and tracking
processes for Interim Climate
Mitigation Performance Targets
and interim milestones andmetrics for monitoring
purposes.
4. Stakeholder communication andengagement and feedback
mechanisms.
5. An escalation process to enable
any challenges or concerns inrelation to the Certified Entity’stransition to be communicatedto and considered by senior
management and the Board as
appropriate.

Additional guidance--

and the milestones and metrics identified
in the Delivery Strategy
Anticipated underperformance of futureinterim Climate Mitigation Performance
Targets and milestones and metrics
identified in the Delivery Strategy due tochanges in internal or external factors thatmight impact on future delivery.
Changes in anticipated operating conditions
that might conversely enable a tightening
or strengthening of Climate Mitigation
Performance Targets and associated updateof the Delivery Strategy.

Evidence that the development of
the Climate Mitigation Performance
Targets and Delivery Strategy on
which Certification has beenobtained have followed this internal
control process.
A public statement by the managing
body or executive management
committing to review the Climate
Mitigation Performance Targets andDelivery Strategy at least every 5
years, and notification of the nextscheduled review.
For subsequent annual verifications
Evidence of regular overallmonitoring of the internal control
system to determine that suchcontrols are effective.
Any Climate Mitigation Performance
Targets reset since the previous
verification engagement are incompliance with the requirements ofClause C.3.1 and supported by a(revised) Delivery Strategy thatcomplies with Clause C.3.2.
C.3.3.3.
Correction ofunderperformance

In the event that interim
Climate Mitigation
Performance Targets andmilestones and metrics due
during the period of
Certification have not beenmet, corrective action must be
taken to reverse that under-

To obtain Certificationn/a
For subsequent annual verifications in the event of underperformance
only

Climate Mitigation Performance Targets andmilestones may be reset as part of this corrective
process (i.e. resetting Climate Mitigation
Performance Targets and/ or the Delivery
Strategy can be the corrective action), but any
revised Climate Mitigation Performance Targets
and/ or Delivery Strategy must be in complianceCriteria as written in PART C of the Climate Bonds
Standard v4.0
performance, so no
Performance Target or
milestone is unmet for a period
longer than 12 months.

Certification Checklist

Additional guidance

A unified dashboard underpinned bya single system of record to track all
instances of underperformance andtheir associated action or mitigationplans.

with the requirements of Clauses C.3.1.1 andC.3.2.

The corrective actions are deemed to
be feasible and sufficient to correct
the performance gap.
The corrective actions are approved
and subsequently monitored by the
Board.
C.4. COMMITMENTS OF THE PARENT GROUP
C.4.1. Exclusions
C.4.1.1.
Expansion offossil fuelactivities

C.4.1.2.
Conversion ofhigh carbon
stock land

If any legal entity within the
Parent Group is in the businessof the exploration or extractionof fossil fuels, or is a utility
company generating or
supplying power or heatgenerated from fossil fuels, theParent Company has, within
the last year, publicly(re)committed to no expansionof any of the following
activities across the Parent
Group after 1 January 2023:
i.
The exploration andextraction of
conventional andunconventional fossil
fuel reserves; orii.
The exploration of
new conventional
and unconventional
fossil fuel resources;oriii.
Natural gas
production; oriv.
Refining crude oil toproduce derivative
products; orv.
The supply and/or
use of fossil fuels for
power generationand heat.

To obtain Certification

The Parent Company has,within the last year, publicly(re)committed that as of 1
January 2020 no entity within
the Parent Group has or will
convert, fragment orunsustainably intensify
operations on high-carbon
stock land leading to the loss of
its status as high-carbon stockland.

To obtain Certification

Commitment documented in a
published policy or statement.
For subsequent annual verifications
Commitment documented in a
published policy or statement.

These activities include unconventional sources
such as hydraulic fracking, arctic drilling, oilsands and shale deposits.
No expansion means no additional commitmentof CapEx for the acquisition or leasing of new
fossil fuel assets. These assets might be fixed(e.g., property, plant, equipment) or intangible(e.g., goodwill, capitalized licences).
Already committed CapEx with pre-dated Board
sign off is not included in the exclusion.
Capex for maintenance of existing fossil fuelassets is permitted, so long as it does not extend
the life of those assets.

Commitment documented in a
published policy or statement.
For subsequent annual verifications
Commitment documented in a
published policy or statement.

High-carbon stock land is defined as:i. Wetlands: land that is covered with orsaturated by water permanently or for asignificant part of the year; andii. Continuously forested areas: land spanningmore than one hectare with trees higher
than five metres and a canopy cover ofmore than 30 %, or trees able to reachthose thresholds in situ; andiii. Land spanning more than one hectare withtrees higher than five metres and a canopy
cover of between 10 % and 30 %, or trees
able to reach those thresholds in situ.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

C.4.2. Net zerocommitment

To obtain Certification

The commitment must cover reducing (without
the use of offsets) material scope 1, 2 and 3
emissions to zero or to a residual level that is
consistent with reaching net-zero emissions at
the global or sector level in eligible 1.5°C
scenarios or sector pathways and neutralizing
any residual emissions at the net-zero target
date and any GHG emissions released into theatmosphere thereafter (offsets may be utilised
to address these residual emissions only).

The Parent Company has
approved and made public net
zero emissions commitments
covering all material scope 1, 2
and 3 emissions of the entire
Parent Group, or already has
net zero emissions as
determined in line with the
GHG Protocol and based onemission data that is
independently verified/audited
and not more than 2 years old.

Commitment documented in a
published policy or statement.
For subsequent annual verifications
Commitment documented in a
published policy or statement.

All relevant GHGs required as per the Kyoto
Protocol (CO2, CH4, N2O, HFC, PFC, SF6, NF3)
must be included.
Materiality is defined as at least 95% of groupwide scope 1 and 2 emissions. Plus, forcompanies with scope 3 emissions that are atleast 40% of total emissions (scope 1, 2, and 3
emissions), at least 90% of scope 3 emissions.

C.4.3. Transition
Plan

The Parent Company has
approved and made public
corresponding Transition Plans
to support the public net zerocommitment for the Parent
Group (per Clause C.4.2).

To obtain Certification
A documented, public Transition Planfor the Parent Group, aligned with
the net zero commitment, that
includes:i. The nature of the economic
activities undertaken by eachlegal entity within the Parent
Group and their respective
contribution to the Parent
Group’s total emissions andrevenue. This includes theactivities of the Certified Entity.
ii. The GHG reduction targets of allparts of the Parent Group not
forming part of the Certified
Entity. This must include thetarget date(s) by which eachactivity is set to achieve net zero
emissions, and interim targets
for each activity over the short,medium and long term alignedwith that target. These targets
must address all material scope
1, 2 and 3 emissions.
iii. If any part of the Parent Grouppractices any of the activities
described under Clause C.4.1.1.,
the plans to fully cease those
activities by the earlier of:a. a ten-year timeframe,
andb. 2030 if located in anOECD country or 2040
elsewhere.
For subsequent annual verifications
Any amendments or updates to theTransition Plan since the previous

Materiality is defined as at least 95% of groupwide scope 1 and 2 emissions. Plus, forcompanies with scope 3 emissions that are atleast 40% of total emissions (scope 1, 2, and 3
emissions), at least 90% of scope 3 emissions.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

verification engagement meet the‘To obtain Certification’requirements.
C.5. DISCLOSURE
C.5.1.
Information todisclose

The Applicant publishes andkeeps accessible on theirwebsite the information
presented in Table C1.

To obtain Certification
All items under the ‘To obtain
Certification’ column of Table C1
have been publicly disclosed in linewith the format of disclosure
requirements in Clause 5.2.
For subsequent annual verification
All items under the ‘For subsequentannual disclosure’ column of Table
C1 have been publicly disclosed inline with the format of disclosure
requirements in Clause 5.2.

C.5.2. Format ofdisclosure

Disclosures have been and will
be made according to thecustomary practices regarding
corporate disclosures, such as
via annual reporting, dedicatedsustainability reporting,statutory filings and investor
presentations, at the discretionof the Applicant.

To obtain Certification
For subsequent annual verification-

There are no specific requirements regarding
where the disclosure items per Table C1 should
be disclosed, so long as they are publicly
available and remain publicly available via the
Applicants’ website at a minimum.
Examples: Annual reports, sustainability reports,
websites.
In respect of Transition Plan disclosures per
Table C1, the same corporate reporting norms
should be applied as are applied to general
purpose financial reporting. Specifically, any
information should be disclosed that, if omitted,
misstated, or obscured, could reasonably be
expected to influence the decisions that the
primary users of general purpose financial
reporting make on the basis of that reporting.
Disclosure integrates with, and build from,broader climate related disclosures in thereporting entity’s general purpose financial
reports.

C.6. EXTENDING ENTITY CERTIFICATION
C.6.1. Extending
entitycertification to
instruments
linked to the
ClimateMitigation
Performance
Targets andDelivery Strategy

The Applicant may use Entity
Certification as a steppingstone to certification offinancial instruments linked to
the Climate Mitigation
Performance Targets andDelivery Strategy of theCertified Entity as assessed per
Clause C.3, such as a
Sustainability Linked Bond orLoan, or a compatible Use-ofProceeds Bond.
Certification is not
automatically extended tothese financial instruments. It
requires an Approved Verifier
to verify the link between the
Entity certification andSustainability Linked Debt
(SLD)/ Use-of-Proceeds
Certification, under Part D/
Part A of the Standard andmeet any other SLD/ Use-ofProceeds criteria as describedin this document.

n/a

Example 1: Certification of a Sustainability Linked
Bond (SLB) whose Sustainability Climate
Mitigation Performance Targets are tied to thesame Climate Mitigation Performance Targets,
Delivery Strategy and other metrics and evidence
used by the issuing entity to determine theCertified Entity’s compliance with PART C of the
Climate Bonds Standard v4.0.
Example 2: Certification of a Use-of-Proceeds
debt instrument where the eligible nominatedassets and projects the proceeds are allocated toare compliant with Clause A.4 and no way
conflict with or undermine the Climate
Mitigation Performance Targets and/ or Delivery
Strategy used by the issuing entity to determine
the Certified Entity’s compliance with PART C the
Climate Bonds Standard.

Criteria as written in PART C of the Climate Bonds
Standard v4.0

Certification Checklist

Additional guidance

C.6.2. Extending
entitycertification to
general purpose
debt

n/a

The certification of the general purpose debt will
apply as long as the issuing entity remains a
Certified Entity.

n/a-

A Certified Entity may also
apply for certification of any
general-purpose debt issued by
the same Certified Entity, suchas commercial paper, revolving
credit facilities or a general
purpose bond.
A company wishing to certify
its general-purpose debt mustcomplete the Climate Bonds
Information Form and submit itto the Climate Bonds Standard
Secretariat. The Climate Bonds
Secretariat will award
Certification without the needfor a Verification Report by an
Approved Verifier.

C.6.3.
Revocation oflinkedcertification

Should certification of theCertified Entity lapse or be
revoked for any reason inaccordance with Box C2,
certification of any linked
instrument still outstanding will
also be publicly revoked.