Sustainable finance strategies are raising the sustainability bar; impact assessment needs to evolve to create a fruitful symbiosis

In this very welcome paper, Jiri Dusik and Alan Bond propose a connection between recent developments on taxonomies for sustainable finance and the wellestablished EIA system. They point out implications from the language used by the taxonomies to avoid greenwashing under the ‘sustainable development’ label. On a second level, they correctly indicate that both instruments can benefit from each other by working together. I briefly examine both of these dimensions. ‘Sustainable Development’ became a widely adopted and popular concept, mainly because it could be moulded to accommodate everyone’s interests. It was certainly more palatable than the soonforgotten concept of eco-development proposed by the Secretary General of the 1972 Stockholm Conference of the Human Environment, which was more critical of unlimited economic growth. When the environmental, social and economic dimensions of development are taken as interchangeable, and when one of these (environment) is in a weaker position given that it is not prominent in the development ‘accounts’ (a privilege reserved to the economic variables), the trade-offs are invariably to the detriment of the environment. Moreover, in the logic of the law of diminishing returns, as the state of the environment is increasingly degraded, the impact of further economic development on the environment is lower. In a way, EIA was meant to be an instrument that would analyse the impacts on the environment, informing a decision-making process that then brought the economic and social players to present their cards, initiating thus the trade-offs game. ‘Strong’ sustainability, where critical natural capital is to be protected at all costs, has remained the exception, and the intimate relationship between a healthy environment and economic and social development, clearly highlighted by the concepts of ecosystem services and of planetary boundaries, remains out of the field of vision of short-term planners and developers. The European Union has been at the forefront of promoting an understanding of sustainability that acknowledges critical natural capital. For example, if a project is likely to significantly affect the integrity of a Natura 2000 site (the natural sites with the highest level of protection in the EU), it can only be justified on the grounds of ‘imperative reasons of overriding public interest’; even then, compensatory measures need to be taken if the integrity of the site is compromised. The endless chipping away of the environmental ‘capital’ in favour of economic growth justified by the trade-offs logic appears now as a cynical interpretation of sustainability in the light of the massive evidence of the global environmental and climate change crises we are facing. The jolly free swap of cards (three green ones exchanged for one of the brown ones) needs to stop, and a clear definition of sustainability that responds to the global challenges we are facing is long due. Minimising adverse impacts on the environment can no longer satisfy us; what used to be the end objective is now but the minimum expected from any development project. The challenges we are facing call for a transformational change in the way we are developing. Ergo, the traditional focus of EIA falls short of expectations; Jiri and Alan believe not only that we can still save EIA but that EIA can support our more ambitious goals. It is here that the language and approach of the EU Taxonomy on sustainable finance seems to be revolutionary. To qualify as ‘sustainable’, projects they must contribute to at least one environmental or climate change objective, and they must show ‘no significant harm’ to the rest. However, a closer reading reminds us that the trade-offs approach is very much alive. Take as an example the Delegated act for activities that qualify as contributing substantially to climate change mitigation or adaptation; when it comes to hydropower plants, a cumulative impact assessment is necessary, and must identify and address any significant regional or basin-level environmental impacts. However, if the assessments demonstrate that the project ‘could deteriorate or compromise the achievement of good status/potential of the specific water body it relates to’ an in-depth cost-benefit assessment is to be performed. In spite of such impacts, the hydropower plant can still be considered ‘sustainable’ if it ticks the