Experts on the EU taxonomy – Anette Andersson, Senior Sustainability Investment Specialist, SEB
How is the EU taxonomy applied in practice? Learn from leading experts
who have already gained a solid understanding of the taxonomy.
The EU taxonomy has undeniably made headlines and raised issues within both sustainability and finance. Although the vast majority agrees that the taxonomy is a relevant step forward, there is yet much left to be defined and still much to learn from its practical application.
To raise our knowledge about the EU taxonomy, we have interviewed experts with different perspectives who have already gained a clear picture of what the taxonomy means in practice. In the first part of this interview series, we introduce Anette Andersson, Senior Sustainability Investment Specialist at SEB:
Tell us about your background – how did you first come into contact with taxonomy?
I have worked with investments in the financial industry for 30 years, of which 10 years as a fund manager of sustainable/ethical equity funds. About 15 years ago, I started working with sustainable investments, but it was something completely different from what we are talking about today. From focusing mostly on excluding companies or industries for ethical reasons it has developed into an inherent part in analyzing investments.
Since we have not had a clear definition of sustainability, it has been difficult for both financial players and customers to specify what sustainable investments actually mean. Different players work in different ways.
Marie Baumgarts from SEB (Head of Sustainability Regulatory Affairs) was part of the so-called TEG (Technical Expert Group) who supported in the production of the taxonomy. Through her contribution the team got to take part in the progress of creating it.
What are your impressions of the taxonomy so far?
The taxonomy is incredibly complex and difficult to communicate, yet it is necessary. It contributes in making sustainability work tangible and comparable, evaluating all businesses and industries according to the same set of criteria.
What effects do you expect the taxonomy to have for listed companies?
It will allow for more explicit and relevant sustainability reporting. It will also facilitate how we as investors follow-up and monitor company performance.
And for the others?
Smaller companies will be faced with a tougher road ahead, mainly associated with higher reporting demands by investors (both in terms of reporting frequency and information quality).
What advice would you give to unlisted and listed companies regarding taxonomy and sustainability work?
Since reporting according to the taxonomy will be mandatory, there is not much to add. When it comes to reporting sustainability work in general, my advice is to start from what is important for the company, i.e. choose a small number of important (material) sustainability KPI:s and build from there. Sustainability must be profitable and support companies with risk mitigation and facilitate opportunities – it is not just a reporting requirement. Since the sustainability area is both vast and under constant growth, one can easily get stressed.
Regarding unlisted companies I would say that they should attempt to collaborate with their owners or maybe even their competitors. For example, if you have a PE company as your main investor, make sure to use their expertise.
The taxonomy has been faced with some opposition. What are your thoughts on that?
Novelty will always faced with a certain amount of resistance and in this case resistance may be increased due to the taxonomy requiring additional reporting from both companies and investors. I believe that when the taxonomy is fully developed, investors will find the process of making informative decisions in relation to sustainability more straightforward.
The taxonomy is still new – what will be the next step?
My hopes are that the taxonomy will branch outside the EU and become a global standard.
Many thanks Anette for your participation!
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