Forward-looking GHG impact assessment should inform capital allocation and management decisions for an investor, entrepreneur, or project developer, by providing a better understanding of the direct mitigation (direct impact), indirect GHG emissions reduction (indirect impact), or system enablement potential (induced impact) of the project, or of the technologies or solutions offered by the venture.

When assessing the future GHG impact of a project or a venture, the impact evaluator should appropriately define and communicate the system impacted, and reflect all the direct, indirect or induced GHG emissions reductions made possible by the venture or project within the system boundaries, for early stage technologies and companies this will very likely be affecting the scope 1 & 2 emissions of another party. including but potentially beyond its own scope 1, 2, 3 emissions.

Impact evaluators should seek to quantify as much as possible all relevant direct, indirect or induced future GHG emissions reductions impact (whether potential or planned) within the defined system boundaries in defined time horizons. We will provide further guidance on direct and indirect effects via Frame.

System-enabling technologies or solutions whose impact cannot be quantified should be appropriately characterized and recognized for their impact contributions (this includes possible negative impacts).

Any baseline against which the projected GHG impact assessment is made for new projects or technologies or solutions should be clearly articulated, including whether the analysis takes a static (status quo baseline) or a dynamic baselines (which takes into account likely future developments in baseline technology or markets which would increase or decrease GHG emissions, absent those new projects or technologies).

A common terminology should be adopted by impact evaluators, in order to help stakeholders navigate GHG impact assessments and facilitate the comprehension of their meanings. Access Frame’s growing glossary of terms here.

A systematic forward-looking GHG impact assessment methodology should be followed throughout the commercial life of the venture or project, necessitating a degree of consistency between data, assumptions, and measurement approaches used during different stages of the venture or project’s existence and under different sets of owners and impact evaluators. Access Frame’s methodology for forward-looking GHG impact assessment.

The methodology used and assumptions taken for GHG impact assessment should be documented by impact evaluators, to provide transparency and comparability across investors, companies and projects and to facilitate best practices and sharing.

Impact evaluators shall make no excessive or misleading claim as to the venture or project’s role or contribution regarding its direct, indirect or induced impact. Investors assessing the future GHG impact of their portfolio should not make any excessive or misleading claim as to the ownership of the carbon emissions reduced by their portfolio companies and projects.

Input data used (e.g., baselines, future markets trends and technology adoption) should align with reasonable and commonly referenced data and scenarios.

The risks to each venture or project achieving its impact potential should be assessed, and assessment accuracy should be adapted to the time horizon of the forward-looking GHG impact assessment, recognizing that uncertainty grows with the horizon of the assessment.

Forward-looking GHG impact assessment methodologies should be reviewed and improved based on lessons learned and the impact realization as actual impact data becomes available through the deployment of the project or the venture’s products and services. We encourage transparent reporting through impact or ESG reports and encourage investors to have their impact report independently reviewed.

GHG values should not be overestimated. It is a best practice to be conservative when data and assumptions are uncertain and update estimates over time