European Taxonomy

The EU taxonomy is a cornerstone of the EU’s sustainable finance framework, directing investments towards activities essential for achieving the European Green Deal’s objectives. It classifies economic activities meeting criteria aligned with a net zero trajectory by 2050 and broader environmental goals. The EU Taxonomy establishes a common language by providing a shared definition of ‘sustainable,’ promoting transparency and guiding both financial and non-financial entities in making environmentally conscious decisions. Effective since July 2020, the Taxonomy Regulation sets conditions for activities to qualify as environmentally sustainable, aiming to scale up sustainable investment and mitigate greenwashing. Overall, it helps direct investments towards sustainable projects and activities.