Understand the March 2025 EU taxonomy update, how it affects CSRD and ESG compliance, and why ESRS reporting is essential. Dcycle helps you stay compliant.
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EU taxonomy: what’s changing in March 2025 and why it matters if you work in sustainability or finance

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What the Platform recommends (and why it makes sense)

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What the Platform recommends (and why it makes sense)

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Other key takeaways

Legislation
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EU Taxonomy Update 2025: Key Changes to the Delegated Act and Impact on CSRD & ESG Reporting

Updated on
June 26, 2025

On 26 March 2025, the EU Platform on Sustainable Finance published a key document responding to the public consultation on the new delegated act updating the EU taxonomy.

It may sound technical, but it has a direct impact on how companies report on sustainability, how investors assess what’s “green”, and how money flows towards sustainable activities in Europe.

The Platform supports simplifying reporting processes—but makes it clear: simplifying doesn’t mean weakening. You can’t build a sustainable finance system if the rules lose credibility.

Get ahead of 2025 changes with CSRD software that includes EU Taxonomy integration by default.

Here’s what you really need to know:

What is the EU taxonomy and why is it being reviewed?

The taxonomy is the EU’s official system for defining which economic activities are considered environmentally sustainable.

Its main goal: direct private capital towards activities that align with the EU’s climate and environmental objectives.

In March 2025, the European Commission proposed a new delegated act to adjust and simplify the taxonomy’s practical implementation, after two years of initial rollout. The Platform on Sustainable Finance—made up of experts from companies, banks, NGOs, regulators and more—responded with concrete feedback and warnings.

What the Platform recommends (and why it makes sense)

  • Don’t reduce the CSRD’s scope. Keep the current coverage. No opt-in for large companies.
  • Simplify the indicators, not the number of companies required to report.
  • Promote the use of ESRS, the common European standards for sustainability reporting.
  • ‍Support SMEs with proportionate tools like the simplified SME SFS standard.

Keep what works, improve what doesn’t

At Dcycle, we believe speaking the ESRS language is essential to stay competitive in the European market.

We help you take full control of your ESG data through a reporting system that’s standard-compliant and user-friendly.

If you're ready to take real control of your company’s sustainability, you’re looking for our solution. And we’re here to help.

Quick glossary

  • EU taxonomy: The official classification of sustainable economic activities.

  • CSRD: EU directive requiring companies to report on sustainability (replacing the NFRD).

  • ESRS: European Sustainability Reporting Standards.

  • Opt-in: When companies choose voluntarily whether to report (not recommended).

  • CapEx / OpEx / Turnover: Key indicators—investments, expenses, revenue—used to measure sustainability.

  • DNSH: “Do No Significant Harm” to other environmental objectives.

  • GAR / GIR: Green Asset Ratio / Green Investment Ratio. KPIs used by banks and insurers.

  • Partial alignment: Activities that only partially meet taxonomy criteria.
  • SME SFS / VSME ESRS: Simplified reporting standards for SMEs.
Take control of your ESG data today.
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Cristina Alcalá-Zamora
CSRD Specialist | Content Creator

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Frequently Asked Questions (FAQs)

How Can You Calculate a Product’s Carbon Footprint?

Carbon footprint calculation analyzes all emissions generated throughout a product’s life cycle, including raw material extraction, production, transportation, usage, and disposal.

The most recognized methodologies are:

  • Life Cycle Assessment (LCA)
  • ISO 14067
  • PAS 2050

Digital tools like Dcycle simplify the process, providing accurate and actionable insights.

What Are the Most Recognized Certifications?
  • ISO 14067 – Defines carbon footprint measurement for products.
  • EPD (Environmental Product Declaration) – Environmental impact based on LCA.
  • Cradle to Cradle (C2C) – Evaluates sustainability and circularity.
  • LEED & BREEAM – Certifications for sustainable buildings.
Which Industries Have the Highest Carbon Footprint?
  • Construction – High emissions from cement and steel.
  • Textile – Intense water usage and fiber production emissions.
  • Food Industry – Large-scale agriculture and transportation impact.
  • Transportation – Fossil fuel dependency in vehicles and aviation.
How Can Companies Reduce Product Carbon Footprints?
  • Use recycled or low-emission materials.
  • Optimize production processes to cut energy use.
  • Shift to renewable energy sources.
  • Improve transportation and logistics to reduce emissions.
Is Carbon Reduction Expensive?

Some strategies require initial investment, but long-term benefits outweigh costs.

  • Energy efficiency lowers operational expenses.
  • Material reuse and recycling reduces procurement costs.
  • Sustainability certifications open new business opportunities.

Investing in carbon reduction is not just an environmental action, it’s a smart business strategy.