What is Finance/ Taxonomy ?
”Sustainable finance” is understood as finance to support economic growth while reducing pressures on the environment (climate change mitigation and adaptation) and taking into account social and governance aspects (ESG). Sustainable finance also encompasses transparency on risks related to ESG factors that may impact the financial system, and the mitigation of such risks through the appropriate governance of financial and corporate actors.
Sustainable finance is a work stream aimed at supporting the European Green Deal by channelling private investment to the transition to a climate-neutral economy, as a complement to public money.
To implement the Commission’s 2018 action plan on sustainable finance, a proposal for a regulation on the establishment of a framework to facilitate sustainable investment was tabled. This regulation establishes the conditions and the framework to gradually create a unified classification system ('taxonomy') on what can be considered an environmentally sustainable economic activity.
Why is it important for HPs?
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