European Commission adds nuclear power to taxonomy

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Few topics in the sustainable bond market are being discussed as hotly and controversially as the European Union’s sustainable finance taxonomy and the European green bond standard. Key actions in the European Commission’s 2018 action plan on financing sustainable growth, and part of the European Green Deal, the initiatives have been widely criticised by investors and issuers.

The EU taxonomy is a classification system that provides companies, investors and policy-makers with appropriate definitions for environmentally sustainable economic activities. The European green bond standard is a voluntary measure to help scale up the ambitions of green bonds. It has two main objectives: supporting the growth of the green bond segment and promoting its transparency and integrity.

The big challenge with the EU taxonomy is that it has to be both ambitious and implementable. The framework is meant to change over time, but many issuers and investors complain…

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