SFDR, EU taxonomy, CSDR… explained under 1 min
Read time: 1 min
Do you also have an Acronym Overload in Climate Tech?
Here is your 1-Minute Guide to Sustainable Impact.
SFDR
Sustainable Finance Disclosure Regulation.
Transparency is the name of the game. Financial market participants in the EU must disclose how they integrate environmental, social, and governance (ESG) factors. It’s all about knowing where your money’s going and how it’s making a difference.
Article 9
Part of the SFDR focuses on products with sustainable investment as their objective.
Funds labeled Article 9 must disclose how they achieve a positive environmental and social impact.
Think of it as the gold standard for green funds.
CSRD
Corporate Sustainability Reporting Directive.
Expanding non-financial reporting. Large companies, soon even smaller ones, must report on sustainability risks, impacts, and activities. If you're big enough, you’re in.
EU Taxonomy
A green compass for investments.
Classification system for environmentally sustainable activities. Focuses on climate change, water, circular economy, pollution, and biodiversity. Want to call your business eco-friendly? Check the Taxonomy.
CSDDD
Corporate Sustainability Due Diligence Directive.
Responsibility in supply chains. Companies must identify, prevent, mitigate, and account for human rights and environmental impacts. EU and non-EU companies in the EU market are on the hook.
LCA
Life Cycle Assessment.
Evaluates environmental impacts from cradle to grave. Tracks the environmental footprint of products or services from raw material extraction to disposal.
TCFD* (now disbanded as of Nov 2023 at COP28)
Task Force on Climate-related Financial Disclosures.
Framework for consistent climate-related financial risk disclosures. Helps investors understand climate impacts on financial performance.
GRI
Global Reporting Initiative.
Provides standards for sustainability reporting. Ensures transparency and accountability on economic, environmental, and social impacts.
IRA
Inflation Reduction Act.
A major US legislation focusing on reducing inflation by investing in domestic energy production and promoting clean energy. Aims to cut greenhouse gas emissions, increase energy security, and drive down costs for consumers through various incentives and investments.
Conclusion
Short. Sweet. Simple.
*That Would Be Great
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