Is a Global Taxonomy the ‘Investment Highway’ to a Net-Zero Transition?

ESG Investor talked to sustainable finance experts and stakeholders on the forms a global taxonomy should take to scale climate finance internationally.

If current plans to set up a global taxonomy on sustainable finance are well executed, it could supercharge responsible investment flows globally.

The International Platform on Sustainable Finance (IPSF), consisting of 17 member jurisdictions, is currently developing a common ground taxonomy to this end.

The body serves as an international forum of dialogue between policymakers developing sustainable finance policy and seeks to scale private capital towards environmentally sustainable investments.

While not itself a standard setting body, the work of the IPSF will prepare the ground for international standard setters to develop global standards, a 2020 annual IPSF report explains.

A spokesperson at the European Commission told ESG Investor the common classification system, which is being developed in a working group co-chaired by the EU and China, is planning to deliver “its work on taxonomy by autumn 2021, along with a report on sustainability-related disclosure”.

“The comparison exercise will focus on existing (regulatory) taxonomies which, as of now, can be found in the EU and China,” while also considering taxonomies developed by other IPSF members.

Meanwhile any talk of alignment of taxonomies “would seem to be premature”, the spokesperson added, given the different targets and transition pathways of nations… [continues]

Read the full article on Regulation Asia’s sister publication, ESG Investor.

To Top
Share via
Copy link
Powered by Social Snap