Letters: A clear vision for a better future
[Re: The EU’s plans for a ‘social sustainability’ taxonomy are a dangerous intervention, Feb 16]
How will a taxonomy support a better future as we address the global challenges of climate change, biodiversity loss and rising inequality?
Making positive social change happen requires clarity of what is considered positive impact according to a recent study of the best practices of 30 frontrunners in sustainability and impact. It requires coherent implementation and monitoring.
Neither markets nor shareholders alone can be relied upon to deliver positive social impact objectives under the current incentive structures and mismatch between benefits and costs.
So, what should a social taxonomy look like?
According to the best practices of values-based financial institutions, the social taxonomy should provide guidance, not thresholds.
Positive social impact is always context driven. It can never be defined by a limited set of metrics or thresholds. The social taxonomy can and should serve as a reference for financial institutions and investors to assess their social impact.
Tracking inputs and measuring outputs to claim impact are never sufficient on their own. And it should embed social impact themes in an approach centred on the real economy. Respect for human and labour rights must be a basis for all, as stipulated in the EU Taxonomy Regulation already.
Adriana Kocornik-Mina