ESG Verification for the EU taxonomy

The new validation and reporting format primarily addresses financial market stakeholders, property developers and the owners of individual properties or entire portfolios. It serves for more transparency and risk minimisation, especially during the buying and selling process. In addition to requiring financial stakeholders to disclose any project investments they are involved in, in future projects that comply with taxonomy criteria are expected to receive better funding terms. In this regard, the new ESG verification offered by CPEA and the DGNB will serve as independent proof of compliance.

Audits can be carried out concurrently or independently during DGNB certification. In the first step, the DGNB service applies to the taxonomy objective relating to climate change mitigation and associated 'do no significant harm' criteria, as well as the S and G criteria, which are primarily targeted at companies themselves.

With its broad network of experts, the DGNB has more than 10 years of experience in the independent assessment of the sustainability quality of buildings through its activities in the field of certification. The DGNB has a correspondingly high reputation in this area, which is why a verification issued by the DGNB is regarded as a reliable, quality-assured evidence.

Stakeholders using the DGNB service to assess ESG conformity with the EU taxonomy not only receive proof of compliance with the criteria, but also reports capturing the detailed results of assessments, thus providing important pointers on areas that may still require specific improvement.

The questionnaires used in the ESG verification service have already been tested in practice, as they were already used in modified form in the course of an international study on the applicability and marketability of the taxonomy criteria - with consistently positive feedback from the builders, project developers and banks involved in the study.

Additionally, the ESG Verification for the EU Taxonomy represents a genuine European offer for companies from the real estate and financial sectors through cooperation with partner organisations from Spain, Austria, Belgium and Denmark.

Interested international applicants first contact one of the DGNB staff members mentioned above to obtain the appropriate application form. The applicant then sends the completed form by e-mail to system@dgnb.de. The application can be made for one project, several projects or portfolios. The applicant then receives the documents for verification by e-mail. In addition to the questionnaires matching the project, the applicant also receives a guideline describing the exact documentation requirements for the ESG verification. Please note that these requirements will be adjusted promptly in the event of future extensions of the taxonomy criteria by the EU, particularly in the areas of "Social" and "Governance".

Anyone who wants to get an overview of the relevant questions resp. requirements of the taxonomy for the environmental goal climate change mitigation in advance can find an overview for the economic activities new construction, renovation (soon) as well as acquisition and ownership here as a download.

The project-specific documents are submitted by e-mail to system@dgnb.de. The DGNB then examines the documents, evaluates the project with regard to the fulfilment of the EU taxonomy criteria and subsequently prepares a report. This is made available to the applicant by e-mail as official proof.

If a project is already registered for DGNB certification, the process slightly differs. The scope of the documents to be submitted for ESG verification is significantly reduced as the DGNB certification criteria already cover a large number of the requirements of the EU taxonomy that need to be documented. Here, too, the registration and submission of the documents for the ESG verification is done by e-mail to system@dgnb.de.

In principle, projects can be submitted by any developer, building owner or occupant – or anyone working on their behalf. After registering projects, applicants receive documentation providing a detailed list of everything that needs to be included in submissions. Basic ESG expertise is sufficient for submissions during the introductory phase in 2021. Depending on how EU taxonomy criteria develop going forward, in future specific qualifications will be required through the DGNB Academy.

To carry out ESG verification through the DGNB, there is a registration fee of €1500 (DGNB members: €750) plus a verification fee per project. For projects under the DGNB categories of New Construction and Renovation, the project fee is €3000 (DGNB members: €2500). The verification fee for an Acquisition and Ownership project is €2000, or €1500 for DGNB members. If more than one project is submitted at the same time, there is only one registration fee. If an entire property portfolio needs verification, synergies are applied to the auditing fee.
No fee is charged for projects already registered under the latest version of DGNB certification (New Construction Version 2018, Buildings in Use Version 2020, Renovated Buildings Version 2021). Application fees are also waived for all other projects striving to gain DGNB certification. This includes projects that have already been certified but require subsequent ESG Verification for the EU Taxonomy.

Fee Structure

The DGNB Academy will be offering training on the EU taxonomy and sustainable finance continuously. This will cover essential requirements underlying ESG verification. Advanced courses will offer training on managing requirements in practice and introducing continuous improvements. Training is open to DGNB auditors and consultants and to any other parties interested in this area, even without prior knowledge of the work of the DGNB.

Depending on the further development of the EU taxonomy criteria, the offer of the DGNB Academy will be expanded to include a specific qualification that is mandatory for project submission. This does not yet apply to the introductory phase in 2021.

To the DGNB Academy

In principle, it can be stated that many aspects required in the EU taxonomy are already part of the DGNB certification, whereby synergy effects are achieved in the ESG verification. The international study on the marketability of the EU taxonomy conducted by the DGNB with partners also showed that DGNB-certified projects performed significantly better than others. Due to the availability of resilient data, there was less effort involved in processing the verification of the taxonomy criteria.

Conversely, projects that meet the criteria of the EU taxonomy have a very good basis for a successful DGNB certification. In the DGNB System for Buildings in Use, for example, taxonomy-compliant projects already achieve a degree of fulfilment of at least 24 percent. In New Construction, the value is at least 13 percent.

Since the requirements of the EU taxonomy will continue to develop in the coming months and years, they are logically not yet comprehensively reflected in the current DGNB certification criteria catalogues. Until then, there are specific guidelines for the application of the ESG verification for the various DGNB certification systems, in which the additional documentation requirements are described in detail.

In future, the DGNB plans to include the latest version of the EU criteria in all new and further developments of the DGNB system and to integrate the ESG verification as a standard part of certification. This will already be the case for the new Version 2021 of the DGNB System for Renovated Buildings, which will be published shortly. The ESG verification will thus become a standard part of the DGNB certification.