How to value co-benefits such as contributions to Sustainable Development Goals (SDGs) or biodiversity conservation?

In the context where the global carbon credit market increasingly focuses on added values beyond emission reduction factors, accurately valuing co-benefits such as contributions to Sustainable Development Goals (SDGs) or biodiversity conservation becomes particularly important, especially for small and medium-sized enterprises in Vietnam. To achieve this, several internationally recognized and widely applied approaches have been established.

Firstly, the application of credit verification standards that integrate co-benefit criteria, such as the Gold Standard for the Global Goals or Verra CCB (Climate, Community & Biodiversity), is a necessary step. These standards not only require projects to contribute to at least three SDGs but also provide quantitative toolkits, such as the SDG Impact Tool, to measure, report, and verify specific indicators regarding the environmental and social impacts of the project.

Secondly, Nature-based Solutions (NbS) projects that include biodiversity benefits are prioritized and valued higher by the market. According to the Ecosystem Marketplace report (2022), carbon credits from nature projects can be traded at prices 5 to 18 USD/tCO₂e higher than conventional credits, owing to the synergistic value derived from ecological conservation, climate regulation, and native ecosystem restoration.

Thirdly, to specifically quantify the value of co-benefits, several new tools and models have been developed. The SDG Co-benefit Framework model is a typical example, allowing scores to be calculated for each relevant SDG and generating a composite impact index, thereby supporting the negotiation of credit prices in the market. Similarly, the Biodiversity Impact Credit (BIC) system is also designed as a standard unit for valuing biodiversity within carbon credits.76

Fourthly, traditional environmental economics methods such as replacement cost, social cost of biodiversity, or contingent valuation can also be applied by SMEs to build financial justifications. These tools, which are common in the Payment for Ecosystem Services (PES) mechanism, can help businesses value non-market benefits such as climate regulation, flood control, or pollination services.

Practically, the co-benefit valuation process needs to be tightly integrated into the steps of developing and operating carbon credit projects. Businesses should start by clearly identifying the appropriate SDGs and types of co-benefits, using standard indicator sets for quantification, and then integrating these values into the MRV framework and credit pricing. Promoting these benefits to customers and investors not only increases credibility but also helps businesses access the premium carbon credit market.

In summary, valuing co-benefits in carbon credit projects not only enhances economic value but also serves as a strategic tool for businesses to build a sustainable image, create a competitive advantage, and access green finance sources more effectively in the context of transitioning towards a low-carbon economy.77 78 79 80

References

76. Rossberg, A. G., O'Sullivan, J. D., Malysheva, S., & Shnerb, N. M. (2024). A metric for tradable biodiversity credits quantifying impacts on global extinction risk. Journal of Industrial Ecology, 28(4), 1009-1021.
77. Hamerkop. (2025). Assessing carbon co-benefit standards: Unlocking the value of high-quality carbon projects. Hamerkop. https://www.hamerkop.co/blog/assessing-carbon-co-benefit-standards-unlocking-the-value-of-high-quality-carbon-projects
78. Dendra Systems. (2022, November 17). Carbon measuring and valuing biodiversity co-benefits (Part 1). Dendra. https://www.dendra.io/articles/carbon-measuring-and-valuing-biodiversity-co-benefits-part-1
79. Practical Action Consulting. (2009). Making carbon markets work for the poor in Vietnam. Green Economy Policy Platform. https://www.greenpolicyplatform.org/sites/default/files/downloads/resource/Making_carbon_markets_work_for_the_poor_in_vietnam_Practical_Action_Consulting.pdf
80. Lou, J., Hultman, N., Patwardhan, A., & Qiu, Y. L. (2022). Integrating sustainability into climate finance by quantifying the co-benefits and market impact of carbon projects. Communications Earth & Environment, 3(1), 137.