Questions and Answers on the Sustainable Finance package

Following the publication of the proposed new „Sustainable Finance package“ which consists of three separate pieces of (proposed) legislation to improve and foster sustainable finance in the EU (please see EventID #21535 and EventID #21559 in this context), the European Commission (EC) has published a corresponding set of questions and answers (Q&As). In brief, the legislations will / would
– establish EU Taxonomy screening criteria for economic activities making a substantial contribution to non-climate environmental objectives;
– expand on economic activities contributing to climate change mitigation and adaptation under the Taxonomy Climate Delegated Act to include activities that weren’t previously covered yet (e.g. manufacturing and transport sectors); and
– establish a new authorization regime for ESG rating providers and stipulate new governance, transparency, disclosure, and conflicts of interest requirements ESG rating providers must adhere to in an effort to increase reliability, trust, transparency over ESG ratings.
The Q&As now provide information on the reasoning behind the issuance of the new package, the objectives the Commission seeks to achieve in this context, and the key content of the package.
The key questions contained in the document are noted below – as quoted; for all of them, please consult the original document:
– What’s in the new package?
– Is the package adding to the administrative burden of companies?
– How are SMEs affected by the sustainable finance framework and how is proportionality ensured?
– What is the current situation with regards to the ESG ratings market and what are the objectives of the Commission proposal?
– What are the main elements of the Commission proposal? [as to the proposed regulation on ESG ratings]
– What is the EU Taxonomy and its Delegated Acts?
– What are the activities included in these Taxonomy Delegated Acts?
– How can the EU Taxonomy and its Delegated Acts concretely support green investments?
– Is there a risk that companies not covered by the EU Taxonomy lose access to financing?
– How long will the scrutiny period by the co-legislators last?
– Is the EU sustainable finance framework working in practice?
– What are the main steps taken by the Commission to improve the usability of the sustainable finance framework?