ICMA publishes overview of ‘taxonomies’ for sustainable finance and recommends success criteria

ICMA’s new publication Overview and recommendations for sustainable finance taxonomies compares the main features and methodologies of official taxonomies from the EU, China and other national authorities as well as influential market-based systems including the Green Bond Principles’ project categories.
Nicholas Pfaff, ICMA’s Head of Sustainable Finance said: ‘We hope that this paper will help market participants and service providers better understand and use existing taxonomies, and will provide especially the official sector with proposed success criteria to benchmark current and future taxonomy initiatives. We emphasise that taxonomies should be designed to work together with complementary approaches in the market and need to be transition-enabled’.
The key success criteria proposed by the paper recommend that taxonomies should be:
- Targeted in their purpose and objectives.
- Additional in relation to existing international frameworks.
- Usable by the market for all intended purposes.
- Open and compatible with complementary approaches and initiatives.
- Transition-enabled incorporating trajectories and pathways.
More information on ICMA’s sustainability work.