Author | Patricia M. LicerasThe European Union has created the first green financing rule book. The European Parliament and EU governments have reached an agreement on the first European criteria to identify investments that may be classed as green and therefore combat what is known as greenwashing, that is, financial products are advertised as sustainable when really they are not.The aim of this taxonomy or green labelling system is to urge banks, financial managers and insurance companies to ensure that the financial products they manage comply with environmental and ecological transition requirements in order to be eligible for the Green Dealsubsidies and investments.This Green Deal is the star initiative of the new president of the European Commission, Ursula von der Leyen, who, apart from seeking to make Europe the first “climate neutral” continent by the middle of this century, wants to strengthen the carbon emission targets for 2030.“Europe now has a unique language to make financial markets environmentally aware. It is a very important step forward towards the Green Deal”, said Pascal Canfin, Chair of the European Parliament’s Environment Committee.Specifically, green taxonomy establishes six environmental objectives that need to be considered in order to determine whether a business activity is sustainable and can receive EU funding. These are climate change mitigation and adaptation; the sustainable use and protection of water and marine resources; the transition towards a circular economy; pollution prevention and control; and the protection and restoration of biodiversity. Therefore, in order for an activity to be labelled as sustainable, it must “substantially” contribute, at least, to one of the preceding objectives and not cause harm to any of them.
Nuclear power production, a “transition” activity
