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As a software provider for both large and small and medium-sized enterprises (SMEs), I believe that the latter group will be surprised by the billions of EU funding that will be distributed under the recovery fund to the Covid – the next generation Fund.
Last week, the Czech Republic and Ireland were approved for their national recovery and resilience plans. This makes them the most recent additions to the group of EU countries eligible for transfers from the € 800 billion fund. Most of the 27 member states now have their plans ‘green light’, with funds already distributed. In the next five years, the entire amount will be invested (Report, September 8).
The EU has demanded that at least 37 percent of the funds go to investments that support the bloc’s climate goals. In addition, no investments are allowed that prejudice these objectives, which must be assessed according to the technical criteria of the EU’s rules for sustainable financing, the taxonomy.
It specifies when certain activities can be considered sustainable and will take effect in January. This will require all large and listed companies in the block to report their taxonomy adjustment points.
SMEs, on the other hand, will only be required to report taxonomy scores in 2024, when the proposal for corporate sustainability reporting comes into force.
This delay in implementation was initially a disadvantage when the EU already required compliance to gain access to next-generation funds.
The EU taxonomy is a groundbreaking initiative, aimed at combating green growth and leading capital flows to more sustainable investments. It should be used in the distribution of the largest incentive package in the history of the EU. SMEs should take note and prepare for the “checklist” of taxonomy.