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How Practically Applicable Are the EU Taxonomy Criteria for Corporates?—An Analysis for the Electrical Industry

Author

Listed:
  • Suzana Ostojic

    (Institute of Sustainability in Civil Engineering (INaB), RWTH Aachen University, 52074 Aachen, Germany)

  • Lorenzo Simone

    (Institute of Sustainability in Civil Engineering (INaB), RWTH Aachen University, 52074 Aachen, Germany)

  • Mark Edler

    (Weidmüller Interface GmbH & Co., KG, 32758 Detmold, Germany)

  • Marzia Traverso

    (Institute of Sustainability in Civil Engineering (INaB), RWTH Aachen University, 52074 Aachen, Germany)

Abstract

This study addresses the current and future mandatory reporting on taxonomy alignment for companies within the EU, examining the practical applicability of criteria outlined in the Climate Delegated Act. Focusing on the electrical manufacturing industry through a case study, a five-step method was developed to assess the usability of the sector-specific criteria. The results highlight the need for enhanced usability across all criteria and offer key recommendations for policy development. Particularly, the substantial contribution criteria for climate change mitigation relating to the “manufacture of other low-carbon technologies” and “data-driven solutions for GHG emissions reductions” were found to be impaired by usability issues. These results emphasize the relevance of investigating the activities assessed in this study when policymakers revise the current criteria. Finally, the study highlights the necessity for future implementation of assessments to prevent usability issues and provide a holistic picture of the status quo of the current EU taxonomy criteria.

Suggested Citation

  • Suzana Ostojic & Lorenzo Simone & Mark Edler & Marzia Traverso, 2024. "How Practically Applicable Are the EU Taxonomy Criteria for Corporates?—An Analysis for the Electrical Industry," Sustainability, MDPI, vol. 16(4), pages 1-23, February.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:4:p:1575-:d:1338299
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    References listed on IDEAS

    as
    1. Ottmar Edenhofer & Christian Klein & Kai Lessmann & Marco Wilkens, 2022. "Financing the transformation: a proposal for a credit scheme to finance the Paris Agreement," Climate Policy, Taylor & Francis Journals, vol. 22(6), pages 788-797, July.
    2. Franziska Schütze & Jan Stede, 2020. "EU Sustainable Finance Taxonomy – What Is Its Role on the Road towards Climate Neutrality?," Discussion Papers of DIW Berlin 1923, DIW Berlin, German Institute for Economic Research.
    3. Kirschenmann Karolin, 2022. "The EU Taxonomy’s (Potential) Effects on the Banking Sector and Bank Lending to Firms," The Economists' Voice, De Gruyter, vol. 19(2), pages 275-283, December.
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