The Gold Standard framework is designed to accelerate progress toward climate security and sustainable development. It enables initiatives to quantify, certify and maximize their impacts on climate security and the Sustainable Development Goals. The framework continues to deliver the highest levels of environmental and social integrity. Projects can seek “Gold Standard Certification” and all Gold Standard certified projects are listed on the organization's Impact Registry for public review. 

On the other hand, IRIS+ is the generally accepted system for measuring, managing, and optimizing impact. It maximizes impact on Real Estate, Agriculture, Health, Employment, Education, Financial Services, and Climate Security. The framework Minimizes confusion about how to set objectives, describe and understand the impact, assess success, and clearly communicate impact performance with other impact investing stakeholders.

One of the similarities between IRIS and the Gold Standard framework is how they're created to help companies and investors maximize their impacts on different areas. The two frameworks are available to both individuals and organizations. They contribute to sustainable development. The fact that they help others understand how to effectively measure and manage their impact, and also learn how to expand and improve that impact over time creates another similarity. Both websites can certify NGOs that meet certain criteria.

A dive into the differences shows how the Gold Standard focuses on climate security and the Sustainable Development Goals. IRIS focuses on a variety of areas as compared to the Gold Standard framework. The Gold Standard offers an Impact Registry, which tracks environmental assets like carbon credits. Unlike Gold Standard, IRIS+ has very clear metrics for each of its areas of focus. For instance, “Number of learning hours provided to students during the reporting period.”

As mentioned earlier, the IRIS website's main purpose is to minimize confusion in setting objectives, understanding impact, measuring success, and clearly communicating impact performance with other impact investing stakeholders. In doing this, IRIS+ focuses on sectors including Real Estate, Agriculture, Health, Employment, Education, Financial Services, and Climate Security. 

Meanwhile, Gold Standard focuses on enabling initiatives to quantify, certify, and maximize their impacts in specifically climate security and sustainable development sectors. They give organizations the opportunity to have their projects be “Gold Standard Certified.” However, based on deep research, it appears there are not many projects that have been certified and they all are very specific and similar in nature. Due to Gold Standard’s vague system structure and lack of transparency, we advise Impact X to avoid using Gold Standard as an influence on its creation of a new platform dedicated to consolidating various frameworks.

Our team looked into issues in transparency mainly focusing on IRIS 990 and Communications. During our semester of research, we came across many issues with Gold Standard’s transparency, financials, and communications. Our team reached out to the Gold Standard team after exploring the website and other material like Charity Navigator in hopes of acquiring more information about the certification process, metrics, leadership, and general inquiries encompassing the scope of our project.

After reaching out to five representatives of the website, we waited two weeks to hear back from two people. One’s response was vague and unhelpful. Additionally, the second responder told us he would put us in contact with someone else and never did. After inquiring about a methodology similar to IRIS, we received an even vaguer methodology to measure impact– labeled as Gold Standard Eligible Impact Quantification Methodologies.

Their “Approved Methodology” was just as confusing as every component of its website. As mentioned in our Methodology and Research section, Gold Standard sent us an Excel sheet of metrics that are in the process of “road testing.” These metrics are similar to IRIS but overall confusing and aren’t yet for universal use. Unfortunately, we did not see much benefit from reaching out again, so we pursued other methods of research.

Charity Navigator provided access to Gold Standard’s IRS Forms 990, from which we gathered significant information. The most alarming issues we found associated with their 990 forms were information in Part IV of the 990, “Checklist of Required Schedules,” and executive compensation. The only available documents we could find were Gold Standard’s 990 forms from 2015 to 2018 even though they were founded in 2003.

In the 38 lines of the checklist, we came across several lines that raised eyebrows. For example, Gold Standard reports having residence in Lexington, MA, and said it did not maintain any offices or employees outside of the US, but the Gold Standard Website says its registered address is in Switzerland and almost all of its employees are located across Europe and Asia. Additionally, throughout all the years, the only executive being compensated is Lisa Rosen– Treasurer, Clerk, and Executive Director.”

Her salary varied from $140,000 to $153,131. The following executives Marion Verles (President) and Gideon Gradman (Director) put in one to five hours a week for the recorded four years with no compensation. All three executives on the 990 form are nowhere to be found on the current Gold Standard website. Discontinuities like these lead our team to believe Gold Standard should not be considered in developing a methodology for Impact X.

The lack of transparency and issues in reporting we encountered was made even more apparent after briefly studying B Lab in class. B Lab provides much more in-depth information about its metrics for certification and processes to be labeled as a B corporation. In contrast, Gold Standard’s metrics and steps for certification are terribly difficult to find, and the little description Gold Standard has for its ‘methodology’ is unhelpful.

Upon further research, our team found Marion and Rosen on a spin-off of Gold Standard called Sustain-Cert. Sustain-Cert is a descendant of the Gold Standard Foundation and was created in 2018 “with one ambition: to mainstream credible climate and SDG impact accounting and certification” (About Sustain-Cert). Gold Standard and Sustain-Cert have the same fundamental mission, so our team is confused as to why there was a change; they tackle decarbonization needs and certify projects that meet its standards. Before we address Sustain-Cert later on in our proposal, our team has decided to compare NGOs through the lens of IRIS and Gold Standard.

Although Sustain-Cert is new – founded in 2018 – we believe it would be worthwhile for ImpactX to keep them on its radar. Sustain-Cert claims to leverage technology, user-centricity, and innovation to transform the way assessment is currently performed. It says they make certification more accessible, reduce complexity, lower costs of certification, and provide maximum credibility.

The list of things they claim to do goes on, so it may be all smoke and mirrors but there is no way of telling currently without waiting. At the moment, there is no access to its IRS 990 forms, so we could not take a deeper dive into its financials and operations. Sustain-cert does, however, have significant partners including Microsoft and WWF. It may resemble Gold-Standard too closely, but it may expand and become relevant to Impact X.

Overall, the lack of clarity with Gold Standard certification has been concerning, especially because so many nonprofit organizations advertise their “Gold Standard Certified” status to legitimize their efforts. To better understand the impact measurement frameworks currently being used to certify nonprofits, we chose to investigate NGOs that have similar
missions. We looked into each NGO’s impact documents to gain a better understanding of similarities and overlaps that likely made them all Gold Standard Certified. Knowing these similarities will allow us to craft a better, more explicit framework for measuring impact within this particular realm of work.

The first NGO we researched was Microsol, a company focusing on mitigating climate change across the globe. They take on projects around the world and help project developers use more environmentally conscious methods by providing evaluations and carbon certifications. Microsol contributes specifically to seven of the United Nations Sustainable Development Goals (SDGs), including no poverty, good health and well-being, quality education, affordable and clean energy, decent work and economic growth, climate action, and life on land. These contributions have granted them certification by Gold Standard.

The next certified NGO within the same impact category we found was Forest Finance. They provide an opportunity for individuals to engage in impact investing by providing Forest Finance with the capital needed to build forests. As a result, the forests create jobs, generate capital, and in the end, investors are paid for their investment. Forest Finance has been awarded by multiple entities, including Gold Standard. All other recognitions given to Forest Finance have further information listed under their award names except for Gold Standard. Impact investors looking for a way to spend their dollars are left in the dark as to what it means for Forest Finance to be “Gold Standard Certified.”

From a research perspective, it looks as though Forest Finance could meet many of the impact measurement requirements listed under IRIS+. Forest Finance has key indicators such as community engagement, a climate resilience strategy, and a forest management plan. This information is vital to an impact investor in the decision-making process; information like these management plans need to be made easily accessible for all stakeholders.

Next, we reviewed ArBolivia, a project conducted by Plan Vivo. Plan Vivo is an organization that began with an initiative to plant trees in Chiapas, Mexico. The organization has since grown into its own certification system for environmental and social projects. ArBolivia is one of Plan Vivo’s conservation projects focusing on reforestation in Bolivia. ArBolivia meets four key SDGs including no poverty, climate action, life on land, and partnerships for the goals. They go into detail for each of these SDGs to show the public how they are meeting the said goals.

This transparency is critical for impact investors wanting to research opportunities. ArBoliva meets many of the same IRIS+ metrics as Forest Finance. They gave a very clear indication of community engagement by micro-financing loans to local farmers. Additionally, they have provided information about a forest management plan: they give alternatives to traditional deforestation techniques in addition to taking action to replant trees with native species. Overall, ArBolivia meets key metrics for this particular impact category and they were great at sharing how they work to reach these goals.

Overall, NGOs which are certified by any impact metric system should provide clear information on which metrics they are meeting and how. Microsol and ArBolivia did a decent job of providing details on why they received certifications. Conversely, Forest Finance lacked clear information on which metrics they were meeting. Perhaps having a more clear metric measurement system within a particular impact category would help these NGOs be better at sharing key information regarding impact. Below is our solution to this widespread problem.

We’ve mentioned that we would not recommend using Gold Standard as a primary resource for investors to make decisions about their investments. An alternate solution would be to model after the current B-corp model. B Corps are “businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose.”

In order to achieve this prestigious status and join the community, organizations pursuing B corp certification must undergo a rigorous B Impact Assessment to ensure that they align with the rest of the organizations and the standards. Impact X can implement a similar assessment for organizations to join this coalition based on how they’re reporting metrics, the clarity of their plan forward, their transparency, etc.

There would be a large incentive for the organization to undergo this process as it would establish enormous credibility with investors, make it easier for investors to find them, and would put them in a network of other mission-driven groups, lending opportunities for partnership and idea-sharing. This way, instead of Impact X trying to categorize projects and organizations and bring investors to them, the organization can be proactive in securing their certification, and there are incentives for them to do so. For the sake of this deliverable, we will be dubbing this process “ImpactX Certification.”

A large part of becoming “ImpactX Certified” is that the organization will be required to report a certain list of metrics from IRIS+ depending on which field the organization falls under (water usage, clean energy, etc). During each certification process, there will be a list of suggested metrics depending on the category. For example, an organization receiving certification under “sustainability” will automatically have “CO2 reduction” as a suggestion. If a suggested metric absolutely does not apply to an organization, they may remove that metric, but the point of having a suggested list is so that the organization that is trying to receive certification can ensure that they have not left out reporting important statistics.

After doing a similar analysis ourselves, we realize that combing through these metrics is not always easy for an investor. To systemize the process of selecting a relevant organization in which to invest, each NGO will be required to put together two separate documents. The first document is a shorter, 1-page synopsis of the metrics. This document will serve a role similar to an abstract in a scientific paper so that investors can make a brief overview of the organizations most relevant to their priorities and make a decision on which of them they want to pursue information on further. If the organization peaks interest, the investor can then look at the second document which is a full outline of the metrics and mission that the organization is reporting.

For example, follow along with the prototype, and let’s look at an investor that is solely interested in investing in organizations that help female entrepreneurs. First, they navigate to that category of the website titled “women.” Then they can narrow down the option to “for women.” They are presented with a list of NGOs that pertain to this topic. If they click on the first NGO’s name, they are presented with the organization’s mission statement, brief description, and an
option to look at the two documents.

The investor looks at the abstract document and sees within minutes that the reported numbers are to their liking. They see that organization has helped to start 103 female-run businesses that year, has generated $2.8 million in revenue among those businesses, and has a 50% growth plan for the following year. Based on this, the investor decides to look at the second, longer document that they now feel is worth their time. Based on the full metrics, the investor decides that this is an organization that they want to invest in and they reach out directly from the site.