An activity must contribute substantially to at least one of six environmental objectives, do no significant harm to the others and meet minimum social safeguards. EU companies and financial institutions report taxonomy-aligned turnover, capital and operating expenditure.
Source: Tüzük (AB) 2020/852
Related terms
EU Corporate Sustainability Reporting Directive (CSRD)The EU directive requiring certain companies to report on sustainability under the European Sustainability Reporting Standards (ESRS) and to obtain assurance on those reports.Green financeInstruments such as green bonds, green loans and sustainability-linked loans used to finance projects with environmental benefits.GreenwashingMisleading claims and communication that present a company's products, activities or financial instruments as more environmentally sustainable than they really are.Carbon Border Adjustment Mechanism (CBAM)An EU regulation that puts a price on the embedded carbon emissions in the production of certain goods imported into the European Union.Carbon creditA tradable certificate representing one tonne of carbon dioxide equivalent of greenhouse gas reduction or removal achieved by a verified project.Carbon footprintThe total greenhouse gas emissions caused by an organisation, product or activity, expressed in carbon dioxide equivalent (tCO₂e).
Last updated: November 8, 2026 · This definition is for general information only.