EU Taxonomy Archives - Goodbody Clearstream

As climate change intensifies, businesses, governments, and financial institutions face growing pressure to adopt strong climate transition plans. These strategies are key to building a low-carbon, sustainable future and meeting global goals like the Paris Agreement.

But what exactly constitutes a climate transition plan, and why is it so critical?

A climate transition plan is a structured roadmap that defines an organization’s goals, actions, and resources to address climate risks and reach net-zero emissions. Importantly, Climate Transition Plans (CTPs) are not merely repackaged net-zero strategies or decarbonization roadmaps; rather, they serve as holistic narratives detailing an organization’s strategic approach to sustainability. Given the lack of a universally agreed-upon definition, Goodbody Clearstream has drawn upon the frameworks established by the Climate Transition Plan (CTP) guidelines, the UK’s Transition Plan Taskforce (TPT), and the Corporate Sustainability Reporting Directive (CSRD) to define the key components of a credible CTP.

At the core of any CTP are robust metrics, defined targets, and a structured approach to decarbonization.

Establishing a baseline carbon footprint is a crucial  first step. To begin with organizations should, at a minimum, quantify their Scope 1 and Scope 2 emissions. Additionally they should commit to evaluating their  Scope 3 emissions. With a clear emissions profile in place, the next priority is setting science-based targets to guide decarbonization efforts.

Once targets are established, businesses must identify the most effective decarbonization pathways and initiatives. Decarbonization levers represent broad strategic approaches, such as energy efficiency improvements, electrification, fuel switching, or product modifications. In contrast, decarbonization actions refer to specific, implementable measures designed to achieve emissions reduction goals.

For example, if a company identifies fuel switching as a key decarbonization lever, a corresponding decarbonization action could involve transitioning from diesel to hydrotreated vegetable oil (HVO). Through this process, organizations develop a clear roadmap for achieving their carbon reduction targets.

However, a climate transition plan goes further than just setting targets and outlining actions.

It should also articulate how the business intends to navigate the broader economic transition to a low-carbon future. This involves assessing  climate-related risks and opportunities, using scenario analysis to anticipate  future climate conditions, and strategic planning to address emerging challenges. Furthermore , transparency in  governance is essential, as stakeholders increasingly expect clear, executive-level commitment to sustainability goals.. High-level oversight and robust feedback mechanisms signal an intent to integrate climate goals into the broader corporate strategy.

Developing a climate transition plan is, first and foremost, a complex but necessary endeavour. Moreover, it requires d a high level of maturity in sustainability management. At its core, a CTP is a formalized report that documents the substantial efforts undertaken by a business to align with a low-carbon economy and society. However, this process is not without its challenges, including:

• Carbon Footprint Measurement – Ensuring an accurate and verified inventory of Scope 3 emissions remains a significant challenge.
• Target Setting – Selecting the most appropriate emissions reduction scenarios for both near- and long-term planning, with additional complexities related to the validation process for science-based targets.
• Risk Management – Identifying and preparing for long-term climate risks while developing credible mitigation strategies.

Nevertheless, despite these challenges, climate transition planning is becoming increasingly important aspect of corporate sustainability. CTPs are emerging as key performance indicators for green finance, influencing investor decision-making and regulatory compliance. As their significance continues to grow, organizations that proactively develop and implement credible transition plans will be better positioned to thrive in the evolving sustainability landscape.

If you wish to discuss your climate transition journey or how we can help your businesses, please contact Fionn at fionn@goodbodyclearstream.ie

At COP16, 23,000 people representing 196 countries, over 100 ministers, over 3000 business delegates, civil society, Indigenous people and local communities, youth among others, gathered in Cali, Colombia, for the 16th Conference of the Parties to the Convention on Biological Diversity (CBD COP16). Held over 2 weeks as the first biodiversity COP since the adoption of the Kunming-Montreal Global Biodiversity Framework (KMGBF) two years ago, COP16 marked a significant milestone in global biodiversity conservation efforts to accelerate the implementation of the KMGBF and its 23 targets.

For over 2 weeks, the countries negotiated on critical items for the implementation of the KMGBF, including the need to close the biodiversity financing gap, the role of Indigenous Peoples and Local Communities (IPLCs) and private sectors in the implementation of the KMGBF. After a 24-hour non-stop negotiation on the last day, COP16 ended with some key agreements made and some being postponed to a later stage.

What is the Convention on Biological Diversity?

The Convention on Biological Diversity (CBD) is an international treaty established at the 1992 Earth Summit in Rio de Janeiro. The CBD aims to halt biodiversity loss and promote ecological sustainability through its three primary objectives: conserving biological diversity, promoting sustainable use of resources, and ensuring fair access and benefits. As of now, the CBD has been ratified by 196 countries, making it one of the most widely adopted international environmental agreements. This broad ratification underscores the global commitment to addressing biodiversity loss and working towards sustainable development.

What is COP16?

The Conference of the Parties (COP)is the governing body of the CBD and meets regularly to review progress and negotiate actions for biodiversity preservation. COP16, the 16th meeting of this body, was set to build upon the outcomes of the previous conference, COP15, which saw the adoption of the Kunming-Montreal Global Biodiversity Framework (GBF) in 2022. This framework outlines 23 targets for preserving global biodiversity by 2030, with one of the main targets aiming to protect 30% of Earth’s land and water and restore degraded ecosystems. Additionally, Target 15 focuses on mainstreaming biodiversity across sectors, pushing for all sectors to assess, disclose, and address their impacts and dependencies on nature.

What are the key outcomes of COP16?

Closer look at 6 key outcomes of COP16

1. Establishment of the Cali Fund to share the benefits derived from Digital Sequence Information

In a significant move towards equitable and fair sharing of financial resources from genetic resources, COP16 delegates agreed on a mechanism for benefit-sharing tied to genetic resources with the creation of the Cali Fund. A global fund dedicated to sharing the benefits derived from using digital sequence information (DSI) from genetic resources. This decision encourages large companies and other major entities within sectors such as biotechnology, Pharmaceutical, cosmetics, agribusiness, nutraceutical that benefit commercially from DSI to contribute a 1% of the profits derived from the use of DSI or 0.1% of their overall revenue to the fund. Half of the fund will be allocated to Indigenous Peoples and local communities, ensuring that those who are often the stewards of biodiversity receive fair compensation. The establishment of this fund, although not mandatory, sends a strong signal to global corporations that biodiversity is a shared global resource and the financial benefits derived from it should be shared equally, particularly with the IPLCs and developing countries that are stewards and custodians of nature.

2. Enhanced Role of Indigenous Peoples and Local Communities

One of the celebrated agreements at COP16 was the recognition of the role of Indigenous Peoples and Local Communities (IPLCs) through the establishment of a new permanent subsidiary body under Article 8(j) of the CBD Convention. This is the first Permanent body under a UN Convention and decision-making body to officially recognize the role and importance of traditional knowledge systems in global biodiversity conservation efforts. This is a significant milestone towards inclusive decision-making on issues around safeguarding nature.

3. Progress on updating National Biodiversity Strategy and Action Plans in line with the Kunming-Montreal Global Biodiversity Framework:

In adopting the KMGBF IN 2022, countries agreed to domesticate the Global plan into National Biodiversity Strategies and Action Plans (NBSAPs) outlining how each of the 23 KMGBF targets will be achieved at a national level and the actions and policy measures needed to achieve the target.

By the end of COP16,Out of 196 countries, only 44 countries had submitted  National Biodiversity Strategy and Action Plans as the policy document which will support the implementation of these national targets at national level and Ireland is amongst the countries that have submitted their NBSAPs.119 countries submitted  national biodiversity targets and of all the GBF target, Target 15 focuses on companies acting, assessing and disclosing on nature and 80% of the countries have set a national target aligned with target 15.

4. Launch of a Global Mainstreaming Champions Group to push for Mainstreaming of Biodiversity across sectors:

One of the significant agenda items at COP 16 for business delegates was the mainstreaming of biodiversity across various sectors, which is Target 15 of the KMGBF. This involves integrating biodiversity considerations into business operations, policies, and decision-making processes. 18 national governments announced the establishment of a  Mainstreaming Champions Group to drive progress on biodiversity mainstreaming and embed the targets and goals of the Global Biodiversity Framework within and across all sectors of the economy. This is a positive step towards ensuring the involvement of non-state actors, including business and finance, in the implementation of the GBF. More countries are expected to join this group.

5. Bridging the gap between biodiversity and climate goals

Biodiversity and climate change are intrinsically linked, and this relationship was a key focus of negotiations at COP16. Countries recognized the need to address the interconnections between biodiversity loss and climate change at both the national and international levels. As a result, they agreed to establish pathways for fostering collaboration in national policies under the three Rio Conventions: The Convention on Biological Diversity (CBD), the United Nations Framework Convention on Climate Change (UNFCCC), and the United Nations Convention to Combat Desertification (UNCCD). This synergy will also be a significant agenda item at UNFCCC COP29 in Baku, which is scheduled to take place just a week after COP16.

6. Postponement of key decisions around closing the biodiversity financing gap:

While several important agreements were reached, discussions regarding the establishment of a new Global Biodiversity Fund, which is essential to secure the $200 billion needed annually by 2030 to implement the KMGBF and support biodiversity efforts—particularly in the Global South and developing countries—were postponed due to disagreements over the financial mechanism. Under the framework, parties agreed to raise $200 billion annually by 2030; however, the logistics of this fund are yet to be decided, stalling the implementation of biodiversity projects aimed at achieving the 23 targets of the GBF by 2030.

Business Engagements at COP16

COP16 saw a significant increase in the presence of business and finance corporations, with over 3,000 business delegates—a threefold increase from COP15—reflecting the growing recognition of the private sector’s role in biodiversity conservation and signaling that biodiversity, like Climate change is becoming a critical topic on the corporate agenda. This includes representatives from mining, pharmaceuticals, food, and agriculture and strong representation from financial services. Multiple side events and roundtables were co-organized by organizations including the Taskforce for Nature-Related Disclosures (TNFD), Global Reporting Initiative (GRI), CDP, and Science-Based Targets Network (SBTN). These events focused on nature transition plans, nature strategies, reporting, and the need for accurate and accessible nature data for companies to assess their impacts and dependencies on nature, as well as the interoperability among different frameworks and standards such as TNFD, CDP, CSRD, and GRI.

The Taskforce on Nature-related Financial Disclosures (TNFD) announced that over 500 organizations are now committed to voluntarily reporting their nature-related impacts and dependencies through the TNFD recommendations and approaches and launched their new guidance on nature transition planning. Additionally, SBTN announced the first companies to publicly adopt a science-based target for nature.

The high participation of the private sector and businesses reflects the urgent need for collective action and the recognition that sustainable development and biodiversity protection are interconnected.

What’s next?

COP 16 will resume at a later date and venue to adopt crucial agenda items, including a strategy for resource mobilization (biodiversity finance) and a monitoring framework for the KMGBF. The parties are yet to agree on a new strategy for resource mobilization to help secure $200 billion annually by 2030 from all sources to support biodiversity initiatives worldwide, in line with Target 19 of the KMGBF. The parties will also finalize the monitoring framework that will be used to measure progress against the 23 targets. The next Biodiversity COP 17 will be in 2026 in Armenia.

Conclusion

COP16 set the stage for significant advancements in biodiversity conservation, underscoring the urgent need for collaboration between governments, the private sector, and Indigenous Peoples and Local Communities and Civil Society. The establishment of the Cali Fund, recognition of IPLCs, and the push for mainstreaming biodiversity across sectors signal a shift towards greater accountability and a “whole of society “approach to halt biodiversity loss. As biodiversity and climate change are increasingly recognized as interconnected crises, these developments are crucial for building a resilient and equitable future for all.

What is the Gender Pay Gap?

The Gender Pay Gap is a measure of the difference in hourly remuneration of men and women across a workforce. In Ireland the Gender Pay Gap Information Act was introduced in 2021 requiring organisations with 250 employees or more to report their Gender Pay Gap in 2022.

It is important to note that the Gender Pay Gap is not a measure of discrimination or absence of equal pay for work of equal value. Equal pay for “like work” is a requirement under Irish law, whereas the Gender Pay Gap is a measure of gender representation across an organisation.

The most common driver behind the Gender Pay Gap is that females tend to be disproportionately represented in lower paid positions (lower pay quartiles), while more males occupy the higher paid positions (upper pay quartiles). The Gender Pay Gap can be significantly reduced or even eradicated when the ratio of males and females in each pay quartile matches the ratio within the organisation overall.

As well as it now being a legal requirement, studies consistently show that for companies that actively engage to eliminate any Gender Pay Gap, it improves productivity, drives innovation, aids attraction and retention of talent, and has a positive effect on bottom line.

Who does it apply to?

In 2024, organisations with 150 employees or more are being asked to report and will extend to those with 50 employees or more in 2025. The regulations are currently being revised to reflect the reporting obligations for organisations of this size.

What are the reporting requirements?

Currently, organisations are required to report on full-time, part-time, and fixed-term employees across:

• The Mean and Median gap in hourly remuneration.
• The Mean and Median gap in bonus remuneration.
• The % of men and women receiving bonus remuneration.
• The % of men and women receiving Benefit in Kind.

The regulation also requires the reporting of the respective percentage of employees who fall within 4 pay quartile bands across the organisation – low, lower middle, upper middle, and upper.

Organisations are asked to choose a snapshot date in June and calculations are to be completed based on remuneration data from the 12-months preceding this date. An organisation must report their Gender Pay Gap publicly on their website within 6 months of their snapshot date. For example, an employer who chooses a snapshot date of June 8^th has a reporting deadline of December 8^th.

An online Gender Pay Gap reporting system is currently being developed where companies will submit their Gender Pay Gap in future.

It is also a requirement for organisations to outline the steps they will take to reduce their Gender Pay Gap. To develop an effective action plan, further analysis on employee data can be completed to identify factors contributing to the pay gap and ensure problem areas are being tackled.

Some Helpful Tips to manage your Gender Pay Gap

The measurement and reporting of the Gender Pay Gap won’t solve the issue of gender balance alone, but it will enable your organisation to gain further insight into what is contributing to the pay gap and identify areas of opportunity for pay gap reduction.

Below are some helpful tips for your organisation relating to Gender Pay Gap measurement and management.

• Data management system

Calculating your Gender Pay Gap requires the collection and collation of many types of employee’s pay data. Having a robust data management system in place that will collect the required data in a suitable format is fundamental for Gender Pay Gap calculation. When collecting remuneration data, it is important to also collect other measures apart from gender for each employee, such as job title, division or department, and seniority level. These other measures can be used to extract further insight into your organisational Gender Pay Gap later.

• KPI Measurement

Aside from remuneration data we recommend tracking several KPI’s associated with the movement of people throughout the company. Completing analysis across these measures can give further insight into trends in recruitment, promotion, and employee retention to further support organisational decision making.

Examples of additional data you might measure are details of new joiners, leavers (including reason for leaving), hiring process information including the gender of those shortlisted and longlisted, details of those promoted during each year (including salary raises due to promotion), general salary raises, and % of those eligible taking maternity/paternity leave.

• Trend analysis

Once your Gender Pay Gap calculations are complete, we recommend taking a deeper dive into the data to identify Gender Pay Gap contributing factors. Identifying these contributing factors can support decision making and a strategy in lowering your pay gap. It can be helpful to compare employee remuneration between males and females across several categories such as seniority level, age, department, and number of years employed at your organisation.

For example, you may find the % of males being promoted is higher than the % of females being promoted. Identifying the cause of this difference can support your action plan towards lowering your Gender Pay Gap.

• Research & Awareness

Completing research on the causes of the Gender Pay Gap and solutions to reducing it, especially within your industry, can be a good starting point to understand the Gender Pay Gap context for your organisation. Benchmarking against peers can also indicate how you are performing on Gender Pay Gap within your industry. Communicating this information across your organisation from Board level to employees is important in driving your Gender Pay Gap reduction strategy forward.

• Strategy

Once you have completed appropriate analysis on your Gender Pay Gap data and identified problem areas, it is important to select initiatives and targets that relate to your identified problem areas. Examples of focal areas may include:

• Promoting pay transparency during the hiring process and ensuring employees understand how their pay is determined.
• Developing transparent, structured pay tiers with clear criteria for progression and pay increases.
• Investing in Education and Training to support progression of females through seniority levels.
• Addressing unconscious bias that may arise during hiring, promotion, and evaluation processes.
• Engaging with school and university students to educate females on their career opportunities, helping increase female representation in your organisation. This point is especially important if your industry is known to be male dominated.

How Can Clearstream Help?

Clearstream are currently working with several companies to help them calculate their Gender Pay Gap and prepare the supporting action plan. We also offer insight services to inform the development of the action plan.

If you would like more information on these services, please contact info@clearstreamsolutions.ie

Other Information Sources

The Irish government provide clear guidance on reporting requirements and calculation methodologies at gov.ie.

Goodbody Clearstream are delighted to share that Fran McNulty, Director Responsible Business is now a trained B Leader on the Irish B Leaders Database and can guide companies who are interested in B Corp certification.

Certified B Corporations, or B Corps, are companies that have been verified to meet high standards of social and environmental performance, transparency, and accountability.  The vision of the B Corp movement is an inclusive, equitable, and regenerative economic system for all people and the planet.

Fran can support companies through the B Impact Assessment, which evaluates and verifies performance across five impact areas: governance, workers, community, environment, and customers. B Corp Certification not only measures where a company excels now but also commits it to consider stakeholder impact for the long term by integrating it into the company’s legal structure.

More information can be found via B Lab Europe, or B Lab Ireland, whose mission is to oversee the growth of the B Corp movement in Ireland. B Lab is the nonprofit, global network that creates economic systems change through standards, policies, tools, and programs, and certifies B Corps, while also mobilising the B Corp community to tackle the social and environmental challenges we face.

For further information on how Fran can support company through the B Impact Assessment, contact is fran@clearstreamsolutions.ie 

What is EcoVadis?

EcoVadis is a leading sustainability ratings platform that assesses and rates the environmental and social performance of companies across various industries.

It provides companies with a comprehensive evaluation of their sustainability practices under four main themes: Environment, Labor & Human Rights, Ethics, and Sustainable Procurement, and offers a standardized rating system that enables benchmarking and comparison with industry peers. Under these broad themes it assesses companies progress on topics such as carbon emissions, waste management, labour conditions, diversity and inclusion, anti-corruption measures, and supply chain responsibility.

Who uses it?

While EcoVadis is applicable to a wide range of sectors, it is particularly popular for companies operating in the Construction, Retail, Pharmaceutical, IT Services, Financial Services, Transportation & Logistics and Utilities & Energy sectors. It is being used by many multi-national and large corporates to evaluate sustainability progress within their company and within their supply chain.

How does it score companies?

Ratings are provided on a scale of 1 to 100 and is categorized into different levels: Bronze, Silver, Gold, and Platinum.

Bronze: Indicates that a company has made initial efforts toward sustainability and has implemented some basic sustainability practices.

Silver: Indicates that a company has made progress in implementing sustainability practices and has achieved a moderate level of sustainability performance.

Gold: Signifies that a company has achieved a high level of sustainability performance and has implemented comprehensive sustainability practices.

Platinum: Represents the highest level of sustainability performance.

Rating scores are relative, meaning they are based on a company’s performance compared to its peers within the assessed industry.

Pros:

• EcoVadis provides an evaluation of your company’s current sustainability performance across environmental, social, and ethical dimensions.
• By assessing supplier sustainability practices and accessing supply chain data, EcoVadis helps mitigate risks associated with environmental, social, and ethical issues.
• EcoVadis offers a standardized rating system that allows companies to benchmark their sustainability performance against industry peers and understand sector average scores.
• The assessment helps identify strengths, weaknesses, and improvement areas, enabling companies to make informed decisions and drive sustainability improvements.
• It facilitates supply chain transparency by assessing and monitoring the sustainability practices of ones suppliers. This transparency helps identify and mitigate sustainability risks and can be a driver of change.
• Achieving a favourable EcoVadis score can enhance a company’s reputation and build stakeholder trust.
• EcoVadis helps streamline sustainability reporting by providing a framework for assessing and reporting on environmental, social, and governance (ESG) factors.
• Globally, it is the most widely used sustainability ratings platform with 100,000+ submissions in 2022.

Cons:

• Using EcoVadis requires an investment of financial and time based resources. There are costs associated with the assessment process, platform access, and ongoing engagement.
• While EcoVadis covers a wide range of sustainability criteria, the assessment does not capture the full complexity and context of a company’s sustainability performance. The standardized rating system used by EcoVadis simplifies the complexity of sustainability into a single score.
• EcoVadis relies on the active participation and cooperation of suppliers for accurate assessment and monitoring.
• There is a risk of companies focusing on achieving a favorable EcoVadis rating without implementing substantial and meaningful sustainability practices and strategy.

It’s essential for companies to carefully consider these pros and cons in relation to their specific needs, resources, and sustainability goals when deciding whether to use EcoVadis or any other sustainability ratings platform.

Clearstream Solutions Advisory Services – EcoVadis

Clearstream Solutions can play a role in helping clients improve their EcoVadis score by providing guidance, expertise, and support in implementing sustainability practices. Here are several ways we can assist in achieving a better EcoVadis score:

• Assessment preparation and submission
• Performance gap analysis
• Assist in development and execution of robust action plan
• Policy and procedure review and development
• Data collection and reporting
• Training and capacity building
• Supply chain engagement
• Continuous improvement support