Satisfaction seems to be in order following the preliminary agreement reached by representatives of the European Parliament and the EU Council on Thursday 5 December on the regulation laying the foundations for the future taxonomy on sustainable finance (see EUROPE 12026/4), which will assess, sector by sector, the environmental sustainability of economic activities.
“We bring clarity to the market on what green financing means”, said Bas Eickhout (Greens/EFA, Netherlands), negotiator for Parliament. The Executive Vice-President of the European Commission, Valdis Dombrovskis, stated that this agreement was a “major success ahead of COP25 and for our Sustainable Finance Strategy”.
The overall compromise (see EUROPE 12384/2) provides for the establishment of three categories of investments in: - “green” activities; - “transitional” activities, for which there are no low-carbon alternatives yet; - “enabling” activities that help to develop zero-carbon activities.
As for the highly sensitive issue of the inclusion of nuclear and gas, it was finally decided that they could not be on the list of “green” activities. However, they were neither included nor excluded from the other two categories.
For Sven Giegold (Greens/EFA, Germany), the outcome of the negotiations is a “success” for his political group. The conditions and obstacles provided for in the text in order to be part of these two categories are so high that in practice nuclear energy will not be able to overcome them, he assured in a statement.
Some stakeholders have already welcomed the agreement, while others are still waiting to scrutinise the final compromise before taking a decision.
“While it’s still not the full taxonomy we are calling for, it is to the credit of the negotiators that they found balanced compromises on sticky issues like disclosure”, said Sébastien Godinot, an economist at WWF, in a statement.
For Transport & Environment (TE), this agreement is an “unexpected early Christmas present”. The organisation said the compromise will result in “a very strong regulation that will drive the private investments needed for the transition to a truly sustainable economy”.
On the contrary EuropeanIssuers, the organisation defending the interests of publicly quoted companies across Europe, expressed its grave concern with the recently agreed obligation for big publicly quoted companies (of more than 500 employees according to the 'disclosure of non-financial information' directive) to publish the proportion of their total turnover and the proportion of their total investments (CapEx) and/or expenditures (OpEx) associated with environmentally sustainable economic activities.
All eyes are now on the EU Council. The compromise package was presented to the Member States on Friday 6 December. According to a European source, the meeting was only intended to inform the Member States, and no green light was expected. The real discussion is expected to take place on Wednesday 11 December, at the meeting of Member States’ ambassadors to the EU (Coreper).
The date of the final ‘trilogue’ to formally conclude the agreement has not yet been set, according to our information. While the dates of 16 and 18 December have been mentioned, the meeting could also be brought forward to the following week. (Original version in French by Marion Fontana)