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    EU Taxonomy

    Definition

    The EU classification framework for assessing environmentally sustainable economic activities against six objectives and technical screening criteria.

    Editorial definition: The QHSE Standard, updated 3 October 2026 · https://qhsetech.com/glossary/eu-taxonomy

    Scope: An eligible activity is not automatically aligned; applicable criteria and disclosure duties require separate assessment.

    Sources checked: . Examples are editorial illustrations.

    What the Taxonomy Regulation and its delegated acts say

    The EU Taxonomy rests on Regulation (EU) 2020/852, published on 22 June 2020 and in force from 12 July 2020. Article 3 says an economic activity qualifies as environmentally sustainable where it contributes substantially to one or more of six environmental objectives, does no significant harm to the others, is carried out in compliance with minimum safeguards and complies with technical screening criteria set by the Commission. The six objectives are climate change mitigation, climate change adaptation, sustainable use and protection of water and marine resources, the transition to a circular economy, pollution prevention and control, and protection and restoration of biodiversity and ecosystems.

    Article 8 requires an undertaking that publishes non-financial information under Article 19a or 29a of Directive 2013/34/EU to say how and to what extent its activities are associated with environmentally sustainable activities. Non-financial undertakings disclose the proportion of turnover, capital expenditure and operating expenditure. The Disclosures Delegated Act, Regulation (EU) 2021/2178, defines an eligible activity as one described in the delegated acts, whether or not it meets the technical screening criteria, so eligible is a narrower claim than aligned. Because the duty hangs on Articles 19a and 29a, check how the 2026 amendments to the CSRD scope apply to you.

    Delegated Regulation (EU) 2026/73, adopted on 4 July 2025 and published on 8 January 2026, simplified the reporting content and some do-no-significant-harm criteria. It applies from 1 January 2026, and its Article 4 lets undertakings keep the earlier rules for a financial year starting in 2025. Among other changes, non-financial undertakings may omit assessing activities whose cumulative turnover or capital expenditure is below 10 per cent of the relevant denominator, and must report those amounts separately as non-material. The Commission's delegated acts page, last updated on 17 March 2026 when opened, lists two further delegated acts on technical screening criteria as not yet adopted, so check for later adoption. This page is general information, not advice on disclosure.

    Sources opened :

    What an EU Taxonomy record holds in software

    • A list of the entity's economic activities mapped to the activity descriptions in the delegated acts, with the version used.
    • For each activity, the eligibility conclusion and the reasons.
    • For each eligible activity, the assessment against substantial contribution, do no significant harm and minimum safeguards, with evidence and reviewer.
    • Turnover, capital expenditure and operating expenditure allocated to activities, with the accounting source and a check that nothing is double counted.
    • Any activity omitted under the 10 per cent rule, with the amount reported separately as non-material.
    • The reporting templates produced for the period and the version of the delegated acts they follow.

    Taxonomy-eligible, taxonomy-aligned and green

    Eligible means an activity is described in the delegated acts. Aligned means it also meets the criteria of Article 3 for the objective claimed. A high eligible share says little about alignment, and neither word makes a product, company or investment green on its own. The Taxonomy is a classification, not a rating, and an activity not listed is not thereby harmful.

    A hypothetical example: a manufacturer's activity list

    This case is invented to illustrate the record and describes no real company. A manufacturer lists its activities and finds that two match descriptions in the delegated acts, which are therefore eligible. For the first, a team collects the evidence for each criterion and concludes that the do-no-significant-harm test for one of the other objectives is not met, so it reports the activity as eligible but not aligned. For the second, the evidence supports alignment and the reviewer signs it off.

    Turnover is allocated from the ledger, capital expenditure from the asset register and operating expenditure from cost records. One small activity represents well under 10 per cent of capital expenditure, so the company applies the optional omission, discloses the amount as non-material and notes the choice. Next year a new version of the criteria is published, and the record keeps the earlier conclusions with the version they used instead of overwriting them.

    Common misunderstandings about the EU Taxonomy

    • Eligible is not aligned. Alignment needs substantial contribution, no significant harm, minimum safeguards and the technical screening criteria.
    • The Taxonomy does not label whole companies. It assesses economic activities and reports shares of turnover and expenditure.
    • An activity that is not listed is not necessarily harmful. It is simply not covered by the delegated acts yet.
    • Reporting content has changed. Simplifications apply from 1 January 2026, and more changes to the criteria were still at draft stage on the Commission page.
    • The duty to publish is tied to the CSRD articles, so a change in who reports under the CSRD can change who publishes Taxonomy figures.

    How the EU Taxonomy relates to other glossary terms

    The Taxonomy disclosures sit inside the same management report as the wider sustainability statement.

    • CSRD: the directive whose reporting articles the Taxonomy disclosure duty is attached to.
    • ESG: the topic grouping within which Taxonomy figures are one environmental metric among others.
    • Double materiality: a separate test for which sustainability matters are reported, not the same as eligibility.
    • ISO 14001: an environmental management system whose records may help gather the evidence on pollution and resource use.

    Records and evidence that usually exist for the EU Taxonomy

    • The activity list and the version of the delegated acts applied.
    • Evidence files for each criterion of each aligned activity.
    • Permits, assessments and policies relied on for no significant harm.
    • Minimum safeguards documents such as due diligence and governance policies.
    • Ledger, asset register and cost extracts behind the three financial figures.
    • Review and approval records and the published templates.

    What a software tool needs to capture for the EU Taxonomy

    • A versioned list of activities and criteria from the delegated acts, so a change is visible against the period.
    • Separate fields for eligibility and alignment, and for each criterion with its evidence.
    • Links from each activity to the financial data behind turnover, capital and operating expenditure.
    • Support for the optional omission with a separate report of non-material amounts.
    • A reviewer workflow with sign-off for each aligned activity.
    • Template outputs that follow the version in force for the financial year.
    • A read-only export of conclusions with evidence for an assurance provider.

    Catalog profiles documenting CSRD reporting workflows

    The list comes from the CSRD workflow rule. It does not show that a product supports the Taxonomy criteria or templates, which should be checked in a demonstration.

    Same rule for every product: tagged “ESG Reporting”, “ESG Frameworks Reporting”, “Sustainability Reporting”, “Materiality Assessment”, “ESG & Sustainability” or “Sustainability & ESG”, with a sourced CSRD, ESRS or materiality capability in its record, or one the vendor stated to us, labelled as vendor-stated. Documented and conditional capabilities qualify; check the linked scope before treating a module as included.

    Tekmon pays for a sponsored placement (above); its place in this list follows the same rule as every entry. How lists are ordered

    All 14 matching profiles are shown. Documentation review, not hands-on testing or a claim of compliance.

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    Frequently asked questions

    What is the difference between eligible and aligned?

    Eligible means an activity is described in the delegated acts, whether or not it meets the technical screening criteria. Aligned means it also satisfies Article 3: substantial contribution, no significant harm, minimum safeguards and the screening criteria.

    Who has to publish Taxonomy figures?

    Article 8 applies to undertakings that must publish non-financial information under Article 19a or 29a of the Accounting Directive. Because the 2026 Directive changed that scope, check how it applies to your company and its national transposition.

    Can an activity be left out of the assessment?

    Delegated Regulation (EU) 2026/73 lets non-financial undertakings omit assessing activities below 10 per cent of the relevant denominator for turnover, capital expenditure and, where it is material, operating expenditure, if they report the amounts separately as non-material. Confirm the version for your financial year.

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