The European Union (EU) Creates Taxonomy to Systematically Classify Sustainable Activities

What is the taxonomy?

a 5-step EU classification system for sustainable activities that provides guidelines and classifications to enable institutions to assess whether an activity is environmentally sustainable

Phased in over 2 years

Financial firms and non-financial companies will create disclosure and assessment processes using the taxonomy to examine the overall impact of their activities on climate mitigation and adaptation 

The goal

provide risk insights so firms can integrate climate objectives into strategic plans and determine targets for financing sustainable activities

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