Call for feedback on the draft reports by the Platform on Sustainable Finance on a social taxonomy and on an extended taxonomy to support economic transition

On 12 July 2021 the Platform on Sustainable Finance published 2 draft reports

The 2 drafts reports are important steps in the Platform’s deliverables to advise the Commission on potential extensions of the taxonomy framework beyond environmentally sustainable activities, to cover social objectives and activities that are significantly harmful to environmental sustainability, and those that have no significant impact on it. The Platform’s advice on this will feed into a Commission report on describing the provisions that would be required to extend the scope of the Taxonomy Regulation as set under Article 26 (2a and 2b) of the Taxonomy Regulation.

Draft report on a social taxonomy

The draft report argues that in the face of a pandemic, unanswered social questions around a sustainable transition, continuing human rights abuses and continuously rising costs for housing, it is important to identify economic activities that contribute to advancing social objectives.

Built on the foundation of international norms and principles like the sustainable development goals (SDG) and the UN guiding principles for businesses and human rights, the draft report argues that a social taxonomy would help investors to identify opportunities to finance solutions around ensuring decent work, enabling inclusive and sustainable communities and affordable healthcare and housing.

Draft report on taxonomy extension options linked to environmental objectives

This draft report focusses on support for the environmental transition needed in the whole economy – it recommends further clarity on both: activities that are significantly harmful to environmental sustainability, and those that have no significant impact on it. The aim is to support transitions in areas currently of "significant harm". They should transition to a level that at least does not cause significant harm, even if they do not actually reach substantial contribution (green).

The report sets out options to build on the existing taxonomy and its use.

Calls for feedback

The Platform gathered stakeholder feedback on the draft reports through two calls for feedback, which ran from 12 July to 6 September 2021 at 12:00 CEST (midday), after the original deadline of 27 August was extended.

After considering the stakeholder input, the Platform will submit final reports with their advice to the Commission in autumn 2021. The Commission will analyse and consider these reports in view of the continuous development of the EU taxonomy, as anticipated in the new strategy for financing the transition to a sustainable economy.