In recent decades, the challenges of a rapidly warming planet and other aspects of environmental degradation have motivated a call for all actors in society, including the financial sector, to take responsibility for environmental sustainability. The funding will have to come from both the public and private sectors, leveraging all asset classes, including bank credits, bonds, and secured assets, and involving a wide range of actors, including international financial institutions, central banks and financial regulators, banks, and institutional investors.

This World Bank guide addresses the need among financial market participants for clarity and transparency in what is understood and what qualifies as green. Applying its experience in shaping the debate on sustainable finance and its understanding of the very diverse national contexts of emerging economies, the World Bank Group recommends the principles and methodology for developing a taxonomy of environmentally sustainable activities. A well-defined and structured taxonomy can support better-informed and more efficient decision making and response to investment opportunities that contribute to achieving national environmental objectives