Sustainable Finance Insights Series - 12 | ESMA final report on taxonomy - alignment of non-financial undertakings and asset managers
By Isabel Høg-Jensen
26 mars, 2021 par
vanessa Icardi Serrami

On 1 March 2021, ESMA published its final report on advice under article 8 of the taxonomy regulation (please refer to BSP Sustainable Newsflash Series number 7), which covers the information to be provided by non-financial undertakings and asset managers to comply with their disclosure obligations under the non-financial reporting directive (NFRD).

Key Performance Indicators (KPIs) defined in ESMA’s recommendations to the European Commission disclose how, and to what extent, the activities of businesses that fall within the scope of the NFRD qualify as environmentally sustainable according to the taxonomy regulation.

The main recommendations relate to how to further specify the three KPIs already established for non-financial undertakings in article 8(2) of the taxonomy regulation and KPIs for asset management companies in the scope of the NFRD.

This final report sets out in concrete terms how to comply with the disclosure obligations under the taxonomy framework. Such disclosures are essential to provide investors with the information needed to direct investments towards environmentally sustainable activities.

ESMA’s advice on the KPIs to be disclosed by non-financial undertakings provides the definitions that entities should use for the calculation of the three metrics; the turnover KPI, the capital expenditure (CapEx) and the operating expenditure (OpEx) that asset managers in the scope of the NFRD should disclose.

Such KPIs are complemented with the minimum information that should accompany these disclosures and the methodology and level of granularity for the reporting of the three metrics.

For asset managers, the proposals set out the KPI that they should disclose, the methodology to be applied to that KPI and recommendations for the development of a coefficient methodology to assess taxonomy-alignment of investments in investee companies that do not report under the NFRD.  

It is proposed by ESMA to use standardised templates for their reporting under article 8 in order to facilitate comparability of these disclosures.

ESMA’s final report will be delivered to the European Commission as part of the invitation issued by the European Commission to the European Supervisory Authorities (ESMA, EBA and EIOPA - ESAs). Along with ESMA, the EBA and EIOPA also published their proposals on the same date. It is expected that the European Commission will adopt a delegated act by 1 June 2021.