IE 4.1. Assessment of the share of activities aligned with the EU Taxonomy

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France Invest 2023 / ESG Reporting – IE 4.1. EU Taxonomy Alignment

IE 4.1 from the France Invest ESG reporting framework poses a critical question regarding the alignment of a company’s activities with the European Union’s taxonomy, which is a classification system designed to determine whether an economic activity is considered environmentally sustainable.

1. How to answer this question ?

To answer, the company must assess its activities against the criteria defined by the EU taxonomy and determine if they substantially contribute to at least one of the EU’s six environmental objectives while not significantly harming the others. The response is straightforward: “Yes” if the company has performed this assessment and some (or all) of its activities are aligned with the EU taxonomy, or “No” if not.

2. Why is it important ?

The importance of this question lies in the growing need for transparency in sustainable investments and business activities. For investors, clients, and regulators, knowing whether a company aligns its activities with the EU’s sustainability goals is an indicator of its commitment to sustainable development.

3. Examples :

– Example A: “After assessment, our company confirmed that 40% of our industrial activities comply with the EU taxonomy, mainly in the area of renewable energy production.”

– Example B: “We identified that our research and development division, working on innovations for carbon footprint reduction, is fully aligned with the requirements of the EU taxonomy.”

In sum, the response to IE 4.1 helps to underline the extent to which companies are engaged in eco-responsible activities and comply with the EU’s strategic directions for sustainability.

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