EU taxonomy high on agenda of Presidents’ Board meeting

3 May 2021

Sustainable finance was the big topic...

Sustainable finance was the big topic on the agenda of last week’s meeting of Orgalim's Presidents' Board.

Orgalim President Rada Rodriguez opened the meeting, emphasising the value of connecting across the national associations to share commonalities and valuable insights.

The wide representation of Presidents from Europe's technology industries national associations had the opportunity to hear directly from our guest speaker, Marcel Haag, Director in the Directorate-General for Financial Stability at the European Commission, about the EU taxonomy, and to exchange views on the implications for Europe's technology businesses.

While the EU taxonomy is directly aimed at financial institutions, a key message of this session was that it will, in fact, have a strong direct impact on our industries too. As a central element of the Sustainable Finance agenda, it aims to establish a common understanding of what economic activities qualify as sustainable throughout the EU, to encourage more capital to flow to those activities and to prevent 'greenwashing'. The disclosure requirements will be mandatory for companies that come under the non-financial reporting Directive.

The session saw a valuable exchange between Mr Haag, who gave a first-hand insight into the aims and design of the taxonomy, and the Presidents’ Board members. Among the issues raised on the industry side was the taxonomy’s difficulty of screening for – and keeping up with – rapidly developing technologies and the absence of many of them from the current approach even though they are crucial to help other industries and sectors reduce their carbon emissions. The proportionality for SMEs was also flagged as, while reporting against the taxonomy is mandatory only for larger companies, the many SMEs who are suppliers to those companies will be indirectly impacted. The ability to remain competitive internationally and the need for a level playing field was another point of discussion.

Mr Haag acknowledged the concerns and stressed that more time is needed to address activities that are not yet covered, while reassuring participants that the taxonomy is intended to be flexible, proportionate and able to adjust to the pace of innovation, as well as to developments in climate and environmental science.

Speaking for Orgalim, Director General Malte Lohan pledged to feed  key take-outs from the meeting into the ongoing work on Orgalim's position paper on sustainable finance and assured that Orgalim continues to contribute actively on our industries’ behalf to the technical work through our participation in the Platform on Sustainable Finance. Wrapping up this topic, attendees recognised that the taxonomy is clearly a top priority for industry and one that also needs to be further raised at the national level.

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