Insights
Clear definitions of the sustainability, climate, and ESG terms that matter most — from CBAM and CSRD to SBTi and PCAF. Written by Semtrio's advisory team.
The EU Emissions Trading System is the European Union's cap-and-trade carbon market, requiring covered installations, aircraft and ships to surrender one allowance for every tonne of CO₂ equivalent they emit, under a total cap that falls every year.
The European Green Bond Standard is an EU regulation creating a voluntary "European Green Bond" label, available to issuers that allocate proceeds to EU Taxonomy-aligned activities and meet mandatory disclosure and external review requirements.
The EU Taxonomy for Sustainable Activities is a science-based classification system established by EU law that defines which economic activities can be considered environmentally sustainable — enabling investors, companies, and financial market participants to identify and direct capital toward genuinely green activities and avoid greenwashing.
ESRS are the mandatory European Sustainability Reporting Standards that define what large EU companies must disclose under the Corporate Sustainability Reporting Directive — covering environmental, social, and governance topics across 10 topic-specific standards, underpinned by two cross-cutting standards that apply to all in-scope companies.
Financed emissions are the greenhouse gas emissions associated with a financial institution's lending, investment, and underwriting activities — representing the Scope 3 Category 15 emissions of banks, asset managers, insurers, and other financial institutions — accounted for using the PCAF standard and increasingly required under ESRS E1, IFRS S2, and institutional net zero frameworks.
If you're working through a regulatory framework or sustainability challenge and need clarity on a specific term or concept — our team is here to help directly.
