The EU Taxonomy Regulation Moves Forward

Economic actors across the spectrum have been calling for a harmonized disclosure tool that would enable investors and others to make informed choices on the sustainability attributes of particular investments or activities. As Jones Day recently reported, on April 15, 2020, the European Council, which includes the heads of state of European Union ("EU") countries, moved closer to answering that call by adopting a regulation (the "Regulation") containing an EU-wide classification system for environmentally sustainable economic activities. The Regulation is one of the main pillars of the European Green Deal and forms a key part of the European Commission's action plan on sustainable finance. It underpins three other legislative measures to implement the EU's ESG strategy: the Regulation on sustainability-related disclosures in the financial services sector, the Non-Financial Reporting Directive, and the Climate-Related Benchmarks Regulation.