G&A Resource Paper: Applying the EU Taxonomy for Non-EU Companies

G&A has published a new resource paper: Applying the EU Taxonomy for Non-EU Companies. This is an except from our resource paper:

The EU Taxonomy is a classification system that defines the economic activities of companies based on their contribution to sustainability objectives. Investors can use Taxonomy-aligned information to better integrate sustainability considerations into their investment decisions.

Entities required to report in line with the Taxonomy include:

• Large and listed companies: those required to comply with Directive 2013/34 (Accounting Directive) which sets requirements for annual financial and non-financial reporting
• Financial market participants and financial advisors: issuers of financial products or corporate bonds that are branded as “environmentally sustainable”

By setting clear definitions for what economic activities qualify as sustainable, the Taxonomy provides crucial transparency to achieve the objectives of the European Green Deal and the EU’s Sustainable Finance Framework. The purpose of the EU Taxonomy is not to mandate certain requirements for environmental performance or financial products. Rather, the goals are aligned with the EU’s climate and environmental goals to:

• Create a consistent definition of “sustainability” regarding economic activities
• Support companies in their effort to plan and finance their green transition
• Protect against greenwashing
• Accelerate financing of projects that are sustainable

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