Under construction: The chemical aspects of the Taxonomy Regulation – so far


After many heated debates on what constitutes sustainable business, the final pieces of the giant EU Taxonomy Regulation puzzle are now being developed and put into place. But what is the Taxonomy? How does it work? And how on Earth is it connected to hazardous chemicals?

A transition to a sustainable economic model that respects the limits and livelihoods of our planet needs finances. So how do we make sure that the “dough” ends up in the right “oven” and not the one that is eventually going to burn the entire house down, so to speak? That question is at the very core of the EU’s Sustainable Finance Program, which aims to channel public and private money into sustainable businesses.

The Taxonomy, a part of the Sustainable Finance Program, categorises which economic activities can be labeled as truly sustainable, according to six environmental criteria:

Climate change mitigation

Climate change adaptation

The sustainable use and protection of water and marine resources

The transition to a circular economy

Pollution prevention and control

The protection and restoration of biodiversity and ecosystems

No more greenwashing of financial products

Starting this year, it will be mandatory for companies, banks and investors based in Europe, or operating a European legal entity with more than 500 employees, to report on the first two criteria: the ones concerning climate. The remaining four criteria are going to be published over the coming months, and by January 2023, it will be mandatory to report on all six.

The reports will be made public, putting an end to the opportunity of easily – and incorrectly – declaring an investment as “green”.

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Chemsec, 29-03-22
; https://chemsec.org/under-construction-the-chemical-aspects-of-the-taxonomy-regulation-so-far/