ISS ESG, the responsible investment arm of Institutional Shareholder Services (ISS), has launched an enhanced EU Taxonomy Alignment Solution, to help clients meet imminent and medium-term reporting deadlines for their products’ alignment with all six EU Taxonomy objectives, starting in January 2024.
Last June, the European Commission approved EU Taxonomy criteria for economic activities making a substantial contribution to one or more of the remaining four of the six Taxonomy objectives.
These include sustainable use and protection of water and marine resources; transition to a circular economy; pollution prevention and control; and protection and restoration of biodiversity and ecosystems.
The ISS ESG expanded its solution to cover the recently introduced new technical screening criteria for 45 activities related to the remaining four objectives.
This is along with the amended criteria for 26 existing activities tied to climate change mitigation adaptation.
The enhanced solution provides data that flows directly into existing top entity level factors which can be obtained via multiple delivery channels, per clients’ needs.
“Investors currently face a significant discrepancy between the availability of data reported by investee companies and the granularity of data required to fulfil their own EU Taxonomy reporting obligations,” said Till Jung, managing director, head of ISS ESG.
He added, “Modelled data can be used to bridge both this gap and the gaps created by the staggered implementation of EU Taxonomy requirements.
ISS ESG’s newly enhanced, comprehensive EU Taxonomy Alignment Solution, which uses both modelled and reported data, is now uniquely placed to help clients address the major EU taxonomy-related reporting challenges.”
In addition, he said clients can use the solution to define targets, limits and policies to align with environmental criteria, assess the performance of investments against a tangible environmental taxonomy and monitor their portfolios.
Modelled data on both eligibility and alignment have been available from this month while company-reported data on eligibility for the four remaining objectives will be on offer from January 2024.
This will be followed in 2025 by data on alignment for non-financial companies, and for financial companies, the year after.
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