Answer: A system for categorizing environmentally friendly investments
Notes: The RBI and Finance Ministry could draw from ASEAN's evolving green taxonomy for sustainable trajectories. Green taxonomy defines environmentally sound investments, aiding in preventing greenwashing and guiding informed investment decisions. It channels funds toward sustainable economic activities, encompassing climate mitigation, adaptation, and biodiversity conservation. Activities must contribute substantially to environmental objectives, avoid significant harm, and adhere to social safeguards. Some taxonomies adopt a "traffic light" system for classifying environmental sustainability.
