After publishing its sustainable finance taxonomy regulation in June 2020 on environmentally sustainable economic activities, the Commission has been developing a taxonomy to support socially sustainable finance initiatives. It released the Final Report on Social Taxonomy this February as a proposal to supplement the existing environmental taxonomy. This social taxonomy will guide economic and financial activity and strategy, legislation, reporting and disclosure requirements, and corporate governance on the principles of social sustainability. It is predicated on the idea that economic activity is accountable for its social effects on a business’s workforce, consumers and the communities affected through its value chain.

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