Stockholm (NordSIP) – The Practical Briefings on EU Taxonomy webinar series, organised by the EU Platform on Sustainable Finance, have quickly become a Monday tradition for hundreds of professionals worldwide, including NordSIP. Eager to better understand the intricacies of this complex legislative framework, we tune in, week after week, to hear the lively discussions between experts in the field. “Mondays are for EU Taxonomy,” as they say on Twitter.
Ahead of this week’s session, the organisers had promised to answer the question of what the EU taxonomy means for corporations and exemplify it with a case study. To help deliver on that promise, the moderator, Sean Kidney of Climate Bonds, is joined by fellow expert Nadia Humphreys of Bloomberg (also an EU Platform co-Rapporteur of Usability & Data Workgroup) and Isabelle Lambert, the Corporate Social Responsibility Director of SPIE Group.
While both Humphreys and Kidney excel at pedagogically guiding us through the main features of the taxonomy, this session’s highlight is undoubtedly the case study presented eloquently by Lambert.
SPIE, a European company specialising in multi-technical services in energy and communications with some 45,500 employees, decided early on to embrace the EU taxonomy from the beginning rather than develop its own proprietary green framework. Subsequently, the company has reported a 71% eligibility and a 41% alignment[1] to the EU taxonomy.
The implementation has been and still is challenging, admits Lambert. Yet, she was prepared for the complexity of the evolving regulatory framework. It has, however, taken a toll on her colleagues working with business development and operations, some of whom had previously not even heard about taxonomy. Ultimately, they are the ones who need to assess all business activities and classify them, measure contributions as well as potential significant harm to the sustainability objectives. And while some of the company’s activities, such as the ones related to the interconnected and diversified European electricity grid, are not difficult to assess, taxonomy-wise, others, especially building and renovation projects, present plenty of challenges.
Implementing the taxonomy takes time, explains Lambert, but it can turn into this powerful transformative force if you put in the effort. Her colleagues are now getting used to collecting all material sustainability data. Crucially, internal communication has picked up. It is not just about getting the C-suite all excited about the high taxonomy-alignment numbers. She seems most proud of the healthy internal competition around what they have dubbed “the green share”.
She also points out that, while clients earlier used to be somewhat reluctant to discuss energy-efficient construction, their awareness is improving quickly. Nowadays, a potential customer may ask questions about sustainability even before enquiring about the price.
Verification is another interesting point Lambert takes up. As a French company, SPIE is obliged to have its sustainability disclosures audited by a third party, which can be challenging, according to her. The auditors are not quite ready yet, moving as they are along the same learning curve as the companies they are auditing.
At the end of the session, prompted by the moderator to explore the cost-benefit ratio of implementing the taxonomy so far, Lambert asserts once again the tremendous benefits of going through the challenging process. Onerous as it might be, the quality of engagement with the company’s stakeholders alone makes it worth it, according to her. Lambert’s advice to her peers, therefore, is unwavering: “Don’t be scared to start implementing the taxonomy! Go early, even if it means getting a few things wrong. You can fix your mistakes along the way and improve over time.”
Image by Mathew Schwartz on Unsplash
[1] The distinction between eligibility and alignment is an important one: it is the alignment number that signifies the company’s degree of sustainability, but a high eligibility number is important to understand the significance of the alignment score.
