In order to qualify as environmentally sustainable, economic activities have to fulfil the following requirements:

 

  • contribute substantively to at least one of the six environmental objectives listed in the Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (Taxonomy Regulation);

 

  • not significantly harm any of the above environmental objectives (Article 17 Taxonomy Regulation and Article 2(17) of the Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector (SFDR)).

 

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22 June 2020

 

Taxonomy Regulation published in the EU Official Journal, Article 2a added to the SFDR by Article 25 of the Taxonomy Regulation 

 

 

In this context, 'the principle of do no significant harm’ will be specified through the European Commissions' delegated acts.

 

Article 2a of SFDR grants the European Supervisory Authorities (the ESAs) the power to develop draft regulatory technical standards to specify the details of the content and presentation of the information in relation to the principle of ‘do no significant harm’.

 

Further, the power is delegated to the European Commission to supplement this SFDR by adopting the relevant regulatory technical standards.

  

  

 

 

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SFDR, Article 2a


Principle of do no significant harm


1.   The European Supervisory Authorities established by Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010 of the European Parliament and of the Council (collectively, the ‘ESAs’) shall, through the Joint Committee, develop draft regulatory technical standards to specify the details of the content and presentation of the information in relation to the principle of ‘do no significant harm’ referred to in point (17) of Article 2 of this Regulation consistent with the content, methodologies, and presentation in respect of the sustainability indicators in relation to the adverse impacts referred to in paragraphs 6 and 7 of Article 4 of this Regulation.


2.   The ESAs shall submit the draft regulatory technical standards referred to in paragraph 1 to the Commission by 30 December 2020.


3.   Power is delegated to the Commission to supplement this Regulation by adopting the regulatory technical standards referred to in paragraph 1 of this Article in accordance with Articles 10 to 14 of Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010.
 


 

 

SFDR, Article 2(17)


‘sustainable investment’ means an investment in an economic activity that contributes to an environmental objective, as measured, for example, by key resource efficiency indicators on the use of energy, renewable energy, raw materials, water and land, on the production of waste, and greenhouse gas emissions, or on its impact on biodiversity and the circular economy, or an investment in an economic activity that contributes to a social objective, in particular an investment that contributes to tackling inequality or that fosters social cohesion, social integration and labour relations, or an investment in human capital or economically or socially disadvantaged communities, provided that such investments do not significantly harm any of those objectives and that the investee companies follow good governance practices, in particular with respect to sound management structures, employee relations, remuneration of staff and tax compliance;

 

 

 

 

 

 

 chronicle   Regulatory chronicle

 

 

 

 

22 June 2020

 

Taxonomy Regulation published in the EU Official Journal, Article 2a added to the SFDR by Article 25 of the Taxonomy Regulation 
  

 

 

  

 

 

IMG 0744

    Documentation    

 

 

 


 
Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector (SFDR)

 

Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (Taxonomy Regulation)

 

 

 

 

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Sustainable finance