EU Taxonomy Compliance

What is the

EU Taxonomy?

The EU Taxonomy Regulation entered into force on 12 July 2020. Its objective is to enable both financial and non-financial companies to share a common understanding of which economic activities can be considered environmentally sustainable.

This unified framework plays a key role in promoting sustainable investments by:

providing predictability for investors,
protecting private investors from the risks of greenwashing,
supporting companies in developing climate-friendly and sustainable operations,
reducing market fragmentation through the harmonization of ESG and sustainability expectations.

The EU Taxonomy is a science-based classification system that defines what constitutes an environmentally sustainable economic activity based on the fulfillment of four conditions:

EU Taxonomy.com

EU Taxonomy alignment of real estate assets for green real estate financing and compliance with ESG requirements

Source: https://ec.europa.eu/sustainable-finance-taxonomy/

As the leading green building consultants in Central and Eastern Europe, our expert team played a pioneering role in developing the practical guidance for compliance with the EU Taxonomy’s technical screening criteria for buildings. Our founder and managing director led the EU Taxonomy working group of the Hungarian Green Building Council (HuGBC) and is also a member of the World Green Building Council’s European Taxonomy working group.

As consultants, we supported the first Hungarian real estate development certified by the HuGBC as EU Taxonomy–aligned, and since then we have contributed to the compliance of numerous additional properties and developments.

Thanks to our unique experience, we not only act as advisors but also operate as verifiers as accredited experts of the HuGBC. This up-to-date, system-level perspective enables us to provide our clients with complex, strategic services that go far beyond ensuring Taxonomy compliance alone. With our extensive experience in sustainability frameworks, we support projects from concept development through implementation to long-term value creation.

We help our clients understand and report on the sustainability impacts of their projects, financial investments, operations, and organizational strategies. We support project preparation to achieve EU Taxonomy compliance, assess climate-related risks and opportunities, and develop sustainability strategies and targets for buildings, portfolios, and supply chains.

EU Taxonomy

Services

Banking Certification Support (NC & EB)

Climate Adaptation & Asset Resilience

Portfolio-Level "Quick Check"

For: Owners of energy-inefficient buildings, Asset Managers.

Vulnerability Assessment: Identifying physical climate risks (heat stress, flooding, etc.) specific to your asset's location.
Adaptation Roadmaps: Creating cost-effective technical solutions to mitigate identified risks.
Retrofit Strategy: Aligning energy efficiency upgrades with EU Taxonomy thresholds to unlock better financing terms and increase asset value.

For: Green Funds, Real Estate Investment Trusts (REITs), Asset Management Firms.

Gap Analysis: Rapid identification of which assets are already "Green," which are "Transformable," and which pose a compliance risk.
SFDR Integration: Data-driven insights to support your SFDR (Sustainable Finance Disclosure Regulation) Article 8 or Article 9 reporting.
Investment Prioritization: We help you decide where to allocate CAPEX to achieve the highest portfolio-level Taxonomy alignment score.

For: Commercial Banks, Lending Officers, and Risk Managers.

NC (New Construction): Comprehensive audit of building permits and design documentation to ensure alignment with the latest energy efficiency standards.
EB (Existing Buildings): Verification of technical performance for acquisition and ownership activities.
DNSH Assessment: Detailed "Do No Significant Harm" verification to ensure compliance across all six environmental objectives.
Audit-Ready Documentation: We provide full technical dossiers that satisfy internal risk management and external regulatory audits.

3. Minimum safeguards

It complies, at company level, with the so-called minimum safeguards (e.g. human rights, including labor and consumer rights, taxation, fair competition, anti-bribery and anti-corruption, etc.)
.

For buildings and infrastructure, requirements exist primarily in relation to three of the six objectives:

Climate change mitigation,
Climate change adaptation, and
Transition to a circular economy.

2. Do No Significant Harm (DNSH)

It does not cause significant harm to any of the other environmental objectives.

Compliance with DNSH criteria and minimum safeguards is mandatory for all activities.

1. Substantial contribution

The activity contributes substantially to at least one of the following six environmental objectives:

Climate change mitigation
Climate change adaptation
Sustainable use and protection of water and marine resources
Transition to a circular economy
Pollution prevention and control
Protection and restoration of biodiversity and ecosystems

Why is the EU Taxonomy important

for companies and investors?

It makes real estate assets and owner/operator/tenant companies more attractive to investors seeking sustainable investments, facilitates the credible demonstration of genuine sustainability, and opens up new financing opportunities.

Improved access to capital

It increases transparency and credibility and helps avoid accusations of greenwashing.

Brand strengthening

It prepares companies for future, increasingly stringent reporting obligations and for integrating sustainability indicators into decision-making processes (e.g. ESG, NFRD, CSRD).

Regulatory compliance

It helps identify and manage climate-related risks, protecting companies from operational and regulatory pitfalls.

Enhanced risk management

Which sectors and activities fall under the EU Taxonomy?

Real estate, energy, transport, water management, and agriculture.
Within the real estate and building sector, the key activities subject to requirements are:

ownership and acquisition of existing buildings,
construction of new buildings,
renovation of existing buildings

How does an EU Taxonomy compliance project work?

Initial assessment and definition of objectives
Identification of activities and economic processes
Mapping against EU Taxonomy criteria (eligibility & alignment)
Gap analysis and recommendations to address deficiencies
Reporting and documentation support
Audit or external verification (if required)