Overview
A sustainable finance taxonomy provides common definitions for sustainable economic activities. It can help:
- direct private investment to these activities
- support Australia’s path to net zero emissions
- prevent ‘greenwashing.’
Greenwashing is where a company makes misleading claims about their environmental outcomes.
Initial development phase
The Australian Sustainable Finance Institute (ASFI) developed a sustainable finance taxonomy for climate mitigation. Treasury supported the development with a grant to ASFI.
ASFI released Australia’s sustainable finance taxonomy on 17 June 2025. The taxonomy can be accessed at: Australian sustainable finance taxonomy web page.
In this phase, ASFI focused on net zero-aligned criteria in 6 areas:
- electricity generation and supply
- minerals mining and metals
- construction and the built environment
- manufacturing and industry
- transport
- agriculture and land.
The taxonomy includes definitions to support:
- the environment – through ‘do no significant harm’ criteria
- society – through ‘minimum social safeguards’ criteria.
Governance and oversight
The Council of Financial Regulators’ (CFR) Climate Working Group oversaw the initial development phase.
Visit the CFR website to read about the working group.
The Taxonomy Technical Expert Group gave direction and feedback.
Visit the ASFI website to read about the expert group.
In consultation with key stakeholders, the government will explore options for:
- future governance arrangements
- any potential regulatory use.
Activities
Sustainable finance taxonomy interim report [Publication] 10 September 2024.