The publication of the first delegated act was accompanied by the adoption of a Commission Communication on ‘EU taxonomy, corporate sustainability reporting, sustainability preferences and fiduciary duties: Directing finance towards the European green deal’ that aimed at delivering key messages on how the sustainable finance toolbox facilitates access to finance for the transition.
A second delegated act for the remaining objectives will be published in 2022. Under the Taxonomy Regulation, the Commission had to come up with the actual list of environmentally sustainable activities by defining technical screening criteria for each environmental objective through delegated acts.Ī first delegated act on sustainable activities for climate change adaptation and mitigation objectives was published in the Official Journal on 9 December 2021 and is applicable since January 2022. The protection and restoration of biodiversity and ecosystemsĭifferent means can be required for an activity to make a substantial contribution to each objective.The sustainable use and protection of water and marine resources.The Taxonomy Regulation establishes six environmental objectives It establishes the basis for the EU taxonomy by setting out 4 overarching conditions that an economic activity has to meet in order to qualify as environmentally sustainable. The Taxonomy Regulation was published in the Official Journal of the European Union on 22 June 2020 and entered into force on 12 July 2020. In this way, it should create security for investors, protect private investors from greenwashing, help companies to become more climate-friendly, mitigate market fragmentation and help shift investments where they are most needed. The EU taxonomy would provide companies, investors and policymakers with appropriate definitions for which economic activities can be considered environmentally sustainable. It could play an important role helping the EU scale up sustainable investment and implement the European green deal. The EU taxonomy is a classification system, establishing a list of environmentally sustainable economic activities. This is why the action plan on financing sustainable growth called for the creation of a common classification system for sustainable economic activities, or an “EU taxonomy”. To achieve this, a common language and a clear definition of what is ‘sustainable’ is needed. The current COVID-19 pandemic has reinforced the need to redirect money towards sustainable projects in order to make our economies, businesses and societies – in particular health systems, more resilient against climate and environmental shocks.
In order to meet the EU’s climate and energy targets for 2030 and reach the objectives of the European green deal, it is vital that we direct investments towards sustainable projects and activities.
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