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Brussels faces threat of legal challenge over sustainable finance rules

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By illuminem briefings

· 2 min read

illuminem summarizes for you the essential news of the day. Read the full piece on the Financial Times or enjoy below:

🗞️ Driving the news: Austria and Luxembourg threaten legal action against the European Commission over the inclusion of nuclear power and natural gas in the EU's sustainable finance "taxonomy" rules
• Spain may also develop its own green finance standards

🔭 The context: The EU's taxonomy regulation aims to guide investments towards sustainable economic activities, categorizing industries responsible for 80% of EU greenhouse gas emissions
• Pro-nuclear and pro-gas countries support their inclusion, while opponents argue these energy sources do not align with the EU’s environmental principles

🌍 Why it matters for the planet: Accurate categorization of sustainable investments is critical to avoiding greenwashing and ensuring financial markets genuinely support the transition to renewable energy sources and net-zero emissions by 2050

⏭️ What's next: The European Commission faces increased pressure as the taxonomy rules are likely to be approved by a coalition of pro-gas and pro-nuclear governments
• The potential legal challenges and differing national standards could undermine the taxonomy’s adoption
💬 One quote: Leonore Gewessler, Austria’s green energy minister, stated, “We need to make sure that financial markets stay true to the alternatives of renewable energy.”

📈 One stat: The Institutional Investors Group on Climate Change, whose members have €50 trillion of assets under management, warned that including gas would create an "unnecessary headache" for investors with green ambitions

Click for more news covering the latest on sustainable finance


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