The EU taxonomy applies to the same companies scoped by the NFRD (Non-Financial Reporting Directive), stating for all practical purposes that all large, listed companies with more than 500 employees have to report on their taxonomy score and share this information with their financial reports. 

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The EU taxonomy does not require a level of sustainability performance. It just requires a company to be transparent about how it is performing by screening criteria in the taxonomy, and, where applicable, classifying activities as sustainable. The taxonomy classifies company activities as sustainable and less sustainable. The transparency creates better decision support for investors, banks, funds, customers and the company itself, directing money towards a green transition.

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