EU taxonomy

EU taxonomy for sustainable activities is a tool to support the sustainable transformation of Europe set by the New Green Deal. It helps transform European Union countries into countries with resource-efficient, zero-carbon, and environmentally friendly economies.

The New EU Taxonomy supports the implementation of private financing to achieve the goals of the European Green Deal. The rules for the involvement of private capital are set out in a European Parliament and European Council regulation on establishing a framework to facilitate sustainable investment (the document entered into force on March 10). The new EU Taxonomy was issued in the form of a regulation, which is binding in its entirety and must be directly applied in every EU country. Financial institutions must declare to what extent their products comply with the Taxonomy.

According to the European Union's definition, sustainable finance is the process of the financial sector taking due account of environmental, social, and governance (ESG) aspects to increase its commitment to long-term economic projects.

Source:

https://finance.ec.europa.eu/sustainable-finance/tools-and-standards/eu-taxonomy-sustainable-activities_en