Sustainability Investment Assessment Based on Taxonomy Criteria
Overview of Taxonomy
With the Regulation on the Establishment of a Framework to Facilitate Sustainable Investments (REGULATION (EU) 2020/852), the European Union has established a comprehensive framework for defining environmentally sustainable investments.
This regulation, commonly referred to as the ‘EU Taxonomy Regulation,’ lays out fundamental principles and definitions crucial for assessing the sustainability of investments.
Investments are considered sustainable if they:
- Contribute to one of the environmental objectives
- Mitigate climate change through investments
- Adapt to climate change through investments
- Promote sustainability in the use and protection of water and marine resources through investments
- Transition to a circular economy through investments
- Prevent pollution and enhance pollution control through investments
- Protect and restore biodiversity and ecosystems through investments
- Do not significantly harm any of the environmental objectives
- Comply with minimum protective measures related to OECD guidelines for multinational enterprises and the United Nations’ guiding principles on business and human rights, including the principles and rights outlined in the eight fundamental conventions of the International Labour Organization and the International Bill of Human Rights
- The sustainability assessment of investments is conducted in accordance with technical verification criteria established by the European Commission through delegated regulations.
The first Delegated Regulation (EU) 2021/2139 outlines technical verification criteria for assessing whether investments contribute to the environmental objectives of mitigating climate change or adapting to climate change without significantly harming the other five objectives.
The European Commission is currently working on developing criteria for the remaining four environmental objectives. The Croatia Green Building Council is part of an eight-member consortium established by the German Council for Sustainable Construction, tasked with proposing criteria for evaluating construction projects contributing to the transition to a circular economy
Assessing Investment Compliance with Taxonomy Criteria
Based on the technical criteria outlined in delegated regulations, it is possible to evaluate whether an investment can be deemed sustainable or in line with the Taxonomy. The assessment considers whether the investment meets the criteria for contributing to one of the environmental objectives and the criteria for not causing significant harm to the other objectives.
The Croatia Green Building Council has developed a tool that allows investors and potential investors to assess the alignment of their own investments in buildings with the technical criteria for contributing to climate change mitigation and for not causing significant harm to any of the other five objectives.
Additionally, the Croatia Green Building Council conducts impartial reviews of sustainability assessments of investments in compliance with the Taxonomy.
Who is the Compliance Assessment Designed for?
The compliance assessment is intended for:
- All investors planning investments in:
- The construction of new buildings
- The renovation of existing buildings
- The purchase and ownership of buildings
- Financial and other institutions requiring an independent evaluation of investment compliance with Taxonomy criteria
Compliance Assessment Procedure
After the registration fee is paid, GBC provides the investor with an invoice for registration. Once the registration fee is settled, GBC sends the investor the compliance form for completion.
GBC reviews the completed form, examines the documentation, and subsequently prepares and certifies the report