At its simplest, a taxonomy is a classification system: it ties the question of which economic activities are to be regarded as environmentally sustainable to predetermined technical criteria. The Türkiye Green Taxonomy is a national framework prepared for this purpose and modelled on the European Union taxonomy. Its legal significance lies in taking the “green” label out of marketing language and turning it into a measurable and auditable concept.
Why is it on the agenda?
In the last few years, complementary regulations in the field of climate and sustainability have followed one another in quick succession. At the end of 2023, the Public Oversight, Accounting and Auditing Standards Authority (KGK) published the Turkish Sustainability Reporting Standards (TSRS), and sustainability reporting became mandatory for companies of a certain size. The Climate Law, adopted in 2025, established the legal basis of climate policy, in particular the emissions trading system. The taxonomy serves as a common language between these two structures: it shows by which criteria the “green” revenue, investment and expenditure reported by a company are classified as such.
Environmental objectives
In parallel with the EU model, work on the taxonomy is structured around six environmental objectives:
- Climate change mitigation
- Climate change adaptation
- The sustainable use and protection of water and marine resources
- The transition to a circular economy
- Pollution prevention and control
- The protection of biodiversity and ecosystems
When is an activity considered “taxonomy-aligned”?
For an activity to be regarded as aligned, three conditions generally have to be met together:
- It makes a substantial contribution to at least one of the objectives; this contribution is measured by technical screening criteria specific to the activity.
- It does no significant harm to any of the other objectives; for example, a facility that reduces emissions must not seriously damage water resources or biodiversity.
- It complies with minimum social safeguards in areas such as human rights, occupational health and the fight against corruption.
This structure requires companies not only to declare outcomes but also to document their declarations.
Who is affected?
The primary direct addressees are companies, banks and capital markets institutions that are subject to reporting obligations. The effect, however, spreads along the chain: a company seeking financing through a green loan or a green bond in turn begins to request taxonomy-aligned data from its suppliers. For businesses exporting to the European Union, the carbon border adjustment mechanism and the supply chain expectations of EU customers create pressure in the same direction.
Legal points to note
- Greenwashing risk: As the taxonomy criteria become established, “environmentally friendly” claims that are not based on the criteria will become easier to challenge under the legislation on misleading advertising and unfair commercial practices.
- Reflection in contracts: In green financing agreements, taxonomy alignment, notification obligations and the consequences of losing alignment should be expressly regulated.
- Transition period: The detailed technical criteria and the implementation timetable are being determined by secondary legislation. For this reason, companies that map their current position now will reduce their compliance costs once the effective dates are finalised.
As a new field that brings environmental law to the same table as company law, financial law and consumer law, the taxonomy will be at the centre of both academic debate and practice in the period ahead.