- The European Union has recognised that its ambitious climate targets may only be achieved if funding flows into environmentally sustainable business projects not only in the public sector but also in the private sector.
- Therefore, it put the Taxonomy Regulation into force on 12 July 2020, which provided the world's first legal definition of environmentally sustainable economic activities.
- Furthermore, to promote transparency, Article 8 of the Taxonomy Regulation prescribes a non-financial reporting obligation primarily for public-interest entities. This obligation will be significantly extended and strengthened.
- The new classification system helps investors, governments, and various business organisations make their financial decisions in accordance with the EU’s climate targets, eliminating the risk of greenwashing.
The Regulation will constitute an integral factor in shaping the Hungarian economy going forward. Financial actors, such as banks, investors and insurance companies are incorporating the Regulation into their risk frameworks, which may thus gain importance in fundraising (e.g. bank loans, share and bond issues).
Consequently, apart from the legal obligation, corporations should now assess whether their current and planned activities are taxonomy compliant to be able to establish the extent to which they adhere to the statutory requirements that become increasingly relevant from the aspect of financing.
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PwC’s experts will help you:
- assess to what extent your corporation is affected by the Regulation and your activities are taxonomy compliant
- compile the non-financial report in line with the EU legislation, as stipulated by the Regulation
- set up the reporting mechanism
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