We're still teaching character too. This incentive recognizes achievement with students who have a harder time learning. The addition of a basic diploma recognizes the value of programs that promote work and life skills. The inclusion of alternative measures simply recognizes the value of assessments other than the SOL tests. Many of those are also academically rigorous such as the SAT II and the AP exams.
Some courses are clearly more attuned to demonstration of skills than labeling of parts.
Multiple criteria are always superior to single high stakes pencil and paper tests.