Collaboration to Enhance Global Sustainable Finance Taxonomies

The Climate Bonds Initiative (CBI), Principles for Responsible Investment (PRI), and the United Nations Environment Programme Finance Initiative (UNEP FI) have joined forces to streamline and strengthen sustainable finance taxonomies worldwide. The initiative aims to harmonize taxonomy definitions and concepts, facilitating clarity and consistency among standard setters, policymakers, and users of sustainable finance frameworks.

Sean Kidney, CEO, Climate Bonds, emphasized the critical role of taxonomies in guiding investments toward sustainability objectives. "Taxonomies are akin to 'shopping lists' for sustainable investments, providing essential guidance that simplifies capital allocation toward climate solutions," he explained.

Liesel van Ast, Deputy Head, UNEP FI, highlighted the significance of sustainable finance taxonomies in establishing a universal language for green finance. "With over 40 jurisdictions worldwide developing their own taxonomies, enhancing usability and interoperability is crucial for fostering cross-border capital flows and promoting environmental goals,” she noted.

Nathan Fabian, Chief Sustainable Systems Officer, PRI, underscored the organization's commitment to facilitating the adoption and integration of sustainable finance taxonomies. "Our engagement focuses on ensuring these frameworks support well-functioning financial markets aligned with climate and broader environmental objectives," he stated.

The collaboration will focus on expanding taxonomies to cover emissions reduction, climate resilience, and other environmental criteria. Additionally, it will establish a Taxonomy Resource Center aimed at providing practical tools and resources for developers and users of sustainable finance frameworks. This initiative seeks to integrate taxonomies into regulatory frameworks and engage stakeholders across sectors to scale up private finance for sustainable development globally.

CBI, PRI, and UNEP FI bring extensive experience in sustainable finance across diverse economies, including technical taxonomy development, policy implementation, and support for public sector projects. Their combined expertise aims to foster a cohesive approach that strengthens the foundation of sustainable finance markets worldwide.