Update On The EU's Efforts To Finance Sustainable Growth

The European Union's ("EU") plan to incentivize sustainable development and combat "greenwashing"—the omission or inaccurate disclosure of climate-related information—has taken shape since the Action Plan on Financing Sustainable Growth was published in March 2018.

European "Taxonomy"

Underpinning the EU Action Plan is the draft Taxonomy Regulation, a proposed far-reaching law meant to create a classification system, or "taxonomy," of environmentally sustainable economic activities throughout the EU.

The draft Taxonomy Regulation, among other things, would create a framework for screening sustainable investments and require that any activity labeled "sustainable":

• Substantially contribute to one of the Taxonomy Regulation's six environmental objectives (e.g., climate change mitigation and adaptation, marine conservation, pollution prevention);