Glossary entry

Environmental Performance


Contracts definitions

Option 1

Environmental Performance means the performance of the [Company][Borrower] against the [International Finance Corporation’s Environmental and Social Performance Standards] as assessed within [90] days of Financial Year End by an independent expert approved by the [Shareholders] and appointed by [the Company].

Option 2

Environmental Performance means the performance of the [Company][Borrower] against the [UK Government’s guidance for businesses on measuring and reporting environmental impacts] [key environmental performance indicators for [the Company] agreed by the Board and the [Shareholders][Lender] within [30] days of [insert event]] [ISO 14031] and which shall be assessed by an independent expert approved by the [Shareholders] and appointed by the [Company].

Option 3 (as drafted in Emma's Clause)

Environmental Performance means all or any of the following in relation to the Premises, the Building and/or the Estate:

(i) energy consumption;
(ii) water consumption and discharge;
(iii) waste generation and management;
(iv) generation and/or emission of Greenhouse Gases; and/or
(v) other adverse environmental impacts.

Option 4

Environmental Performance means the combination of factors that can be measured to give an idea of a building’s [or project’s/product’s/process’] environmental impact during manufacture, use and disposal including, but not limited to, the following factors:

(i) the source of materials;
(ii) the use of materials;
(iii) energy sources;
(iv) energy consumption;
(v) water sources
(vi) water consumption
(vii) flexibility, durability and resilience;
(viii) pollution and waste processing;
(ix) transport;
(x) landscape and ecology; and
(xi) deconstruction and disposal.

Model laws definition

Environmental Performance means the state of sustainability of a country as measured by the Yale Centre for Environmental Law and Policy using 32 performance indicators across 11 issue categories covering environmental health and ecosystem vitality and set out in its Environmental Performance Index.

Drafting notes

Measuring environmental performance should not be a tick-box exercise and available budget and resources need to be considered when choosing how to measure environmental performance. A relevant question is whether any financing needs to include the costs of such assessments.

Option 3 provides a short form definition and Option 4 provides a more detailed definition.


Company reports; financing agreements, supply chain contracts.