Finance Watch’s response to the consultation on Taxonomy criteria and disclosures – Consultation response

The Commission published on 26 February 2025 its first omnibus package amending the CSRD (Corporate Sustainability Reporting Directive), the CSDDD (Corporate Sustainability Due Diligence Directive), the Taxonomy Regulation and the CBAM (Carbon Border Adjustment Mechanism) with the intention to simplify the current legislative framework.

The Commission’s package also includes proposed adaptations to the Taxonomy delegated act, including:

• The introduction of a 10% de minimis threshold
• A revision of the Green Asset Ratio formula
• The reduction of data points in the Taxonomy reporting templates.

Finance Watch supports the principle of streamlining the current legislative framework, fixing some inconsistencies and simplifying the application of certain criteria. However, Finance Watch warns that the current proposal goes beyond mere simplification, increases legislative uncertainty and introduces the foundations for a deregulation agenda.

In this response, Finance Watch shares key concerns on the amendments to the Taxonomy Regulation and the related delegated acts:

• The Taxonomy is the best tool to assess corporate sustainability, and making it voluntary for companies with under 450m turnover would severely weaken possibilities to improve the SFDR framework.
• The introduction of a 10% de minimis threshold will lead to an uneven treatment of sectors due to the current segmentation of eligible economic activities.
• The adaptations to the KPIs for financial institutions will not resolve comparability limitations.