Taxonomy
The EU Taxonomy is a classification system that identifies which economic activities qualify as environmentally sustainable.
It provides clear technical screening criteria to determine if an activity substantially contributes to climate change mitigation, adaptation, circular economy, pollution control, and biodiversity protection, while ensuring no significant harm (DNSH) to other objectives and compliance with social safeguards. The Taxonomy influences financial market participants and large companies under the Corporate Sustainability Reporting Directive (CSRD), guiding investments towards sustainable projects. Recent amendments, such as those in the Omnibus I Simplification package, aim to simplify reporting and reduce administrative burdens.
Why is it important?
The EU Taxonomy steers capital flows to support the EU’s transition to a low-carbon and resource-efficient economy. For industries like precious metals, it impacts access to sustainable finance and investment opportunities. However, the current rules focus heavily on design and manufacturing, often overlooking recycling and secondary raw materials, which are critical areas for the precious metals sector.
Clarity and consistency across EU legislation on sustainability criteria are essential to avoid disproportionate restrictions and to ensure that industries can contribute effectively to environmental goals without undue burdens.
To ensure fair access and accurate classification, the EU Taxonomy should:
- Ensure coherence in circular economy language across EU legislation with realistic ambitions acknowledging limits in decoupling economic growth from resource extraction.
- Maintain proportional and practical Do No Significant Harm (DNSH) criteria consistent with existing EU laws, such as REACH and the CRMA.
- Accept multi-metallic recycling as eligible under the EU Taxonomy. Ensure that recycling and refining of precious metals – a multi-metal recycling process – is clearly recognised.
- Avoid extending substitution-focused approaches in chemical manufacture and respect exemptions like those under RoHS for circular electrical and electronic equipment.
- Consider risk management measures alongside hazard classifications to prevent overly restrictive measures.
- Promote voluntary reporting to reduce administrative load.
- Advocate for a leading role for the Joint Research Centre (JRC) and recognition of multi-metallic recycling as eligible activities under the Taxonomy.
