Sustainability labelling as a tool for reporting the sustainable development impacts of climate actions relevant to Article 6 of the Paris Agreement

Karen Holm Olsen (), Fatemeh Bakhtiari (), Virender Kumar Duggal () and Jørge Villy Fenhann ()
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Karen Holm Olsen: Technical University of Denmark
Fatemeh Bakhtiari: Technical University of Denmark
Virender Kumar Duggal: Principal Climate Change Specialist (Future Carbon Fund)
Jørge Villy Fenhann: Technical University of Denmark

International Environmental Agreements: Politics, Law and Economics, 2019, vol. 19, issue 2, No 6, 225-251

Abstract: Abstract The architecture of global carbon markets has changed significantly since the Paris Agreement and the 2030 Agenda for Sustainable Development Goals were both agreed in 2015. Voluntary, international cooperative approaches established in Article 6 of the Paris Agreement allow Parties to work together to achieve the targets set out in their respective Nationally Determined Contributions to limit global warming to an increase below 1.5–2 °C. In Article 6.4, a sustainable mitigation mechanism is established for which rules, modalities and procedures will be developed internationally considering the experience and lessons learned from existing mechanisms, such as the Clean Development Mechanism (CDM) and its Sustainable Development (SD) Tool. Historically the issue of making integrated assessments of sustainable development and mitigation actions has been politically and methodologically controversial for many reasons: developing countries fear that an international definition of SD will interfere with their sovereignty and therefore their ability to define their own development pathways; players in the carbon market fear that markets can only handle one objective, namely mitigation outcomes; and sustainable development is regarded as too complex and costly to be measured and quantified. In an effort to address these concerns, the article proposes a new methodology for the sustainability labelling of climate mitigation actions relevant to Article 6 approaches. The article draws on an application of the CDM SD tool to analyse 2098 Component Programme Activities that had entered the CDM Pipeline by January 2017. The article demonstrates that assessment of the sustainable development benefits of climate actions can be graded and labelled based on the analysis of qualitative data, which is less costly than applying a quantitative approach.

Keywords: Sustainable development (SD) impacts; Climate actions; Labelling; Sustainability reporting; Clean Development Mechanism (CDM); Article 6; Cooperative approaches; Paris Agreement (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (8)

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DOI: 10.1007/s10784-018-09428-1

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