Platform on Sustainable Finance report: Advancing sustainable finance

The Platform on Sustainable Finance, an advisory body to the European Commission, has published an independent report on advancing sustainable finance: technical criteria for new activities & first review of the Climate Delegated Act.

The Platform on Sustainable Finance has been tasked by the Commission with

1. reviewing and potentially recommending amendments to the technical screening criteria of the economic activities included in the Climate Delegated Act adopted in 2021, with a focus on transitional activities for which the Taxonomy Regulation stipulates a requirement for review every three years
2. developing technical screening criteria for a list of new economic activities
3. and developing ‘do no significant harm' (DNSH) criteria for activities to be included in Annex II of the Climate Delegated Act, as “adapted” activities

This is both for the new activities developed under the current mandate and for activities already included in the Taxonomy Delegated Acts for substantial contribution to an environmental objective other than adaptation, for which no such criteria exist yet. The inclusion aims to enhance the economy's climate resilience and support environmental transition by allowing more entities to claim their climate resilience investments as taxonomy‑aligned, ultimately increasing adaptation finance.

All of the Platform’s work under its second mandate is informed by input received from the markets through the EU taxonomy stakeholder request mechanism. In addition, the Platform’s work integrated usability guidance from the Platform’s first mandate, updates in legislation, the latest scientific results and changes in technologies available in the market. This applies both to its recommendations for the development of new activities and for the review of activities already included in the Climate Delegated Act. Reflecting these various elements of the Platform’s mandate, the report contains recommendations for the below‑listed activities/areas.

Review of criteria and analysis for the Climate Delegated Act

• usability improvements for the generic climate change adaptation criteria
• consistency and usability improvements for selected activities under the climate change mitigation and Adaptation objectives, including through harmonising activity titles and descriptions
• adjustment to scientific results and technological developments of selected substantial contribution and DNSH criteria under the climate change mitigation objective
• general recommendations for updating substantial contribution and DNSH criteria under the climate change mitigation objective
• mapping of activities with inconsistent or insufficiently considered DNSH criteria

New activities mandated by the European Commission

• refining substantially contributing to climate change mitigation
• mining substantially contributing to climate change mitigation
• close to market research, development and innovation substantially contributing to all four objectives of the Environmental Delegated Act
• digital solutions and services substantially contributing to all four objectives of the Environmental Delegated Act

New activities mandated by the European Commission, but not completed

• manufacture of emergency aircraft substantially contributing to climate change adaptation
• maintenance of tunnels and bridges substantially contributing to transition to circular economy
• manufacture of tyres substantially contributing to pollution prevention and control
• telecommunication networks substantially contributing to climate change adaptation
• energy efficiency equipment in industry substantially contributing to climate change mitigation

The report includes progress reports for each of the above‑mentioned activities except for telecommunication networks

Further recommendations for climate change adaptation

• DNSH criteria for “adapted” activities for
  • the newly proposed activities under the current mandate of the Platform
  • activities already included in existing Delegated Acts but not included in Annex II of the Climate Delegated Act
• a climate change adaptation headline ambition statement
• an analysis of sectors most vulnerable to physical climate risks – to be prioritised for inclusion as “adapted” activities in the future
• progress on conceptual approach to nature‑based solutions’ inclusion enabling climate change adaptation objective