Glossary

Spending on acquiring or upgrading fixed assets. In taxonomy reporting, companies disclose the share of CAPEX associated with taxonomy-aligned activities.

Numerical simulation of fluid flow such as air or water. Used for wind analysis, thermal comfort mapping, and microclimate modelling around buildings.

A systematic process to identify physical climate risks, assess vulnerability and exposure, and plan adaptation measures. Required under Delegated Regulation (EU) 2021/2139, Appendix A.

EU Directive (2022/2464) requiring large companies and listed SMEs to report on sustainability matters, including taxonomy alignment.

One of the four alignment conditions. An activity must not significantly harm any of the other five environmental objectives to which it does not substantially contribute.

Secondary legislation adopted by the European Commission that specifies the technical screening criteria for each environmental objective. Key acts include the Climate Delegated Act (2021/2139) and the Environmental Delegated Act (2023/2486).

A rating of building energy efficiency from A to G. Activity 7.7 requires buildings built before 2021 to have at least EPC class A or to rank in the top 15% of the national stock.

An activity is taxonomy-eligible if it is described in the Delegated Acts, regardless of whether it meets the technical screening criteria. Eligibility is not the same as alignment.

An activity that enables other activities to make a substantial contribution to an environmental objective without causing lock-in to unsustainable assets.

The share of a credit institution's assets that finance taxonomy-aligned activities. Banks must disclose their GAR under taxonomy reporting rules.

Social minimum standards based on the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles on Business and Human Rights, and the ILO core conventions.

The predecessor to the CSRD, requiring certain large public-interest entities to report non-financial information. Early taxonomy reporting obligations were linked to NFRD scope.

Nearly zero-energy building. For new construction under activity 7.1, primary energy demand generally must be at least 10% below the national NZEB threshold.

Operating expenses. In taxonomy reporting, OPEX typically covers non-capitalised R&D, short-term leases, maintenance, and renovation linked to taxonomy-aligned activities.

EU regulation requiring financial market participants to disclose how they integrate sustainability risks, including the taxonomy alignment of financial products.

One of the four alignment conditions. An activity must make a significant positive contribution to at least one of the six environmental objectives as defined by the technical screening criteria.

Specific quantitative and qualitative thresholds that define when an activity substantially contributes to an objective and when it does no significant harm. They are set out in the Delegated Acts.

An activity under climate change mitigation for which no technologically or economically feasible low-carbon alternative yet exists, while greenhouse gas performance reflects the best performance in the sector.

Revenue from goods sold and services provided. One of the three KPIs companies disclose for taxonomy reporting alongside CAPEX and OPEX.

The phenomenon whereby urban areas are significantly warmer than surrounding rural areas because of dark surfaces, reduced vegetation, building geometry, and waste heat.

A thermal comfort index based on a multi-node human thermophysiology model. It considers air temperature, wind, radiation, and humidity to assess outdoor heat stress.