EU Taxonomy – Technical Working Group

Platform on Sustainable Finance

In order to meet the EU’s 2030 climate and energy targets and reach the goals of the European Green Deal, it is crucial that we channel investments into sustainable projects and activities. To achieve this, a common language and a clear definition of the term “sustainable” is needed. For this reason, the action plan on financing sustainable growth created a single classification system − the EU Taxonomy (Regulation (EU) 2020/852) − for sustainable economic activities.

The Taxonomy Regulation entered into force on July 12, 2020. It lays the foundation for the EU Taxonomy by establishing four overarching requirements that an economic activity must meet to be considered environmentally sustainable. In doing so, the taxonomy criteria addresses six different environmental goals:

    1. Climate change mitigation
    2. Climate change adaptation
    3. The sustainable use and protection of water and marine resources
    4. The transition to a circular economy
    5. Pollution prevention and control
    6. The protection and restoration of biodiversity and ecosystems

The actual EU taxonomy is adopted by the European Commission in the form of a series of delegated acts under the Taxonomy Regulation.

    • A first delegated act on climate change adaptation and mitigation was formally adopted for consideration by the co-legislators on June 4, 2021.
    • In 2022, a second delegated act with technical criteria will be adopted, providing an initial list of activities that make a significant contribution to each of the non-climate related environmental objectives (objectives 3 through 6 in the list above), as well as additional activities that make a significant contribution to the two climate objectives.
    • Thereafter, the development of the taxonomy will continue by adding more activities over time and updating the technical criteria for the activities already included to ensure that they are always in line with the latest scientific and technological developments.

The European Commission develops the EU Taxonomy in close collaboration with external experts (from the public and private sectors) and based on a transparent process involving stakeholders, robust methodologies and scientific evidence.

As a permanent expert group of the European Commission that has been established under Article 20 of the Taxonomy Regulation, the Platform will assist the Commission in developing its sustainable finance policies, notably the further development of the EU taxonomy. In this regard, the Platform on Sustainable Finance is an advisory body subject to the EU Commission’s horizontal rules for expert groups. Its main purpose is to advise the European Commission on various tasks and issues related to the further development of the EU taxonomy and to assist the Commission in the technical preparation of delegated acts to implement the EU taxonomy. Currently, the Platform on Sustainable Finance is divided into six sub-groups based on the variety of tasks and subtasks, the deadlines specified in the mandate, and the different types of skills and expertise required.

The Technical Working Group on the Platform of Sustainable Finance, with Prof. Dr. Marzia Traverso as Co-Chair, started its mandate on October 15, 2020 and focuses on the following objectives within the Platform on Sustainable Finance:

    • Develop the technical screening criteria for environmental goals 3-6 and submit a report in the third quarter of 2021;
    • Report on a revision of the criteria for all six environmental goals by Q3 2022.

Suzana Ostojic
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