Autorité des marchés financiers (AMF), France’s securities commission, has assessed the first alignment reporting of financial institutions under the EU Taxonomy Regulation, finding disclosures remain “dense and difficult to understand”. Since 2022, financial institutions have been required under Article 8 of the taxonomy to report exclusively on the eligibility of their exposures to the EU taxonomy. 2024 marked the first year in which financial institutions also have to disclose the alignment of their exposures or economic activities with the taxonomy. The taxonomy outlines which economic activities can be considered sustainable under its environmental categories, such as climate change mitigation and adaptation. “Due to the technical nature of the Taxonomy Regulation, the quantity of data produced and the format of certain regulatory templates, the disclosures remain dense and difficult to understand, particularly for non-experts,” AMF said. Currently, taxonomy-related information is being published “ad hoc”, the report said, calling for greater overall coherence to ensure disclosures are more relevant and useful for investors. All assessed financial institutions highlighted challenged procuring the data they need to effectively demonstrate taxonomy alignment, the report added. AMF has encouraged financial institutions to continue improving transparency by “clearly indicating the assumptions made, as well as any difficulties encountered, in particular the reasons for not publishing certain indicators”. The commission has separately published a report examining listed companies’ non-financial statements between 2023 and 2024, ahead of the application of the Corporate Sustainability Reporting Directive and its sustainability reporting standards.
