BETTER FINANCE supports ESMA’s efforts to simplify EU Taxonomy reporting. The current framework can be complex and, in some areas, requires significant reporting effort without always providing investors with equally useful information. Simplification is therefore welcome where it removes duplication, improves clarity and focuses reporting on information that investors can meaningfully use.
At the same time, simplification should not create new information gaps. We support a more focused approach to reporting operating expenditure (OpEx), while recognising that R&D alone may not adequately reflect transition efforts in all sectors. We also favour simpler reporting for complex financial groups and stronger links between Taxonomy and ESRS reporting, provided that important information remains comparable and accessible.
More broadly, the review provides an opportunity to make Taxonomy reporting simpler to produce and easier to use. This means clearer definitions, proportionate requirements and greater use of standardised digital information. For individual investors, the priority should be a framework that makes it easier to understand and compare the sustainability and transition characteristics of companies and financial products, rather than simply producing more information.
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