As environmental sustainability becomes increasingly important in the conduct of economic activities, companies operating in different sectors are required to take environmental impacts and sustainability criteria into account in their business processes. In addition, regulations aimed at supporting access to finance for sustainable investments are further increasing the importance of sustainability in financial decision-making processes.
The Türkiye Green Taxonomy Regulation (the “Regulation”), published in the Official Gazette dated 24 September 2026 and numbered 33380, sets out the procedures and principles regarding the classification of economic activities in terms of environmental sustainability, technical screening criteria and taxonomy reporting. The Regulation has been introduced with the objectives of supporting economic activities aligned with sustainable development goals, encouraging the flow of finance towards sustainable investments and preventing “greenwashing” in the market. The Regulation entered into force on the same date.
Türkiye Green Taxonomy and Its Scope
The Türkiye Green Taxonomy has been established as a classification system enabling economic activities to be assessed against specific environmental objectives. The Regulation sets out the applicable conditions, technical screening criteria, reporting and verification processes, and the principles governing the Online Taxonomy Management System in respect of the economic activities listed in Annex-1 and the activities of financial institutions.
The activities listed in Annex-1 are considered “eligible economic activities”; however, the inclusion of an economic activity in Annex-1 does not, by itself, mean that such activity is environmentally sustainable.
For an economic activity to be considered a “taxonomy-aligned economic activity”, it must make a substantial contribution to at least one of the environmental objectives, do no significant harm to any of the other environmental objectives, and meet the minimum social safeguards.
Environmental Objectives and Technical Screening Criteria
The environmental objectives to be taken into consideration in the assessment of economic activities under the Regulation are determined as the reduction of greenhouse gas emissions, adaptation to climate change, sustainable use and protection of water and marine resources, transition to a circular economy, pollution prevention and control, and the protection and restoration of biodiversity and ecosystems.
The technical screening criteria will be taken as the basis for assessing the alignment of economic activities with these environmental objectives. These criteria will be determined by the Climate Change Presidency and published on the Presidency’s website, while updates to the criteria are envisaged to apply as of the following year.
Accordingly, it will not be sufficient for an activity merely to be described as “green” or “sustainable”; it will also be necessary to assess whether the activity meets the requirements set out under the Regulation and the relevant technical screening criteria.
Taxonomy Reporting
The Regulation provides for different reporting requirements for institutions, organizations and enterprises on the one hand, and certain financial institutions on the other, in respect of economic activities.
Institutions, organizations and enterprises carrying out at least one of the eligible economic activities listed in Annex-1 may voluntarily conduct taxonomy reporting in accordance with the reporting templates to be published by the Climate Change Presidency.
On the other hand, reporting obligations have been introduced for intermediary institutions, investment trusts and portfolio management companies, banks, and insurance, reinsurance and pension companies. However, it is regulated that the reporting obligation for such financial institutions will not apply until 1 January 2029.
The reporting will be based primarily on certain key performance indicators, including the ratios of revenue, capital expenditure and operating expenditure derived from taxonomy-eligible or taxonomy-aligned products and services.
Where the ratio of revenue, capital expenditure or operating expenditure arising from eligible economic activities within the scope of Annex-1 to the relevant total amount remains below 10% separately, the relevant key performance indicator may be excluded from the reporting.
Information Flow Between Financial Institutions and the Real Sector
The Regulation also introduces a mechanism aimed at ensuring that the implementation of the taxonomy is not limited solely to financial institutions subject to mandatory reporting obligations.
In this context, financial institutions subject to mandatory reporting obligations may request institutions, organizations and enterprises carrying out activities within the scope of Annex-1 to provide reporting in accordance with the Regulation in respect of business and transactions that may be subject to their own reporting.
Accordingly, even where real-sector companies are not directly subject to a mandatory reporting obligation, they may need to prepare and share taxonomy-related information and data within the scope of their financing relationships. In this respect, the Regulation may indirectly affect the data and sustainability processes of companies in the real sector through the reporting obligations imposed on financial institutions.
Online Taxonomy Management System and Administrative Sanctions
The Regulation provides that the reports to be prepared within the scope of taxonomy reporting must be uploaded to the Online Taxonomy Management System by the end of the sixth month following the end of the relevant financial statement period. Taxonomy reports uploaded to the system are, in principle, to be made publicly available.
However, information and documents uploaded to the system other than taxonomy reports may be shared with third parties with the consent of the relevant institution, organization or company. In terms of ensuring information security, it is provided that the Cybersecurity Law No. 7545, the Climate Law No. 7552 and the legislation enacted thereunder shall apply.
Under the Regulation, where those conducting reporting fail to fulfil their obligation to submit the notifications, information and documents required for reporting, administrative fines may be imposed pursuant to the relevant provisions of the Climate Law No. 7552.
Conclusion and Assessment
The Türkiye Green Taxonomy Regulation establishes an important framework for assessing economic activities against common criteria in terms of environmental sustainability. Although the system introduced by the Regulation does not currently impose a direct and mandatory reporting obligation on all real-sector companies, it increases the importance of environmental data relating to companies’ activities, particularly through financing processes and the reporting obligations imposed on financial institutions.
In this context, it is important for companies to first assess whether their activities fall within the scope of Annex-1 to the Regulation and the technical screening criteria applicable to such activities and, where necessary, to ensure that data that may be used in sustainability, investment and financing processes is maintained on a regular basis.
For companies that obtain financing from financial institutions or plan to benefit from sustainable finance instruments in the future, monitoring the activities that may be assessed under the taxonomy and the financial and technical data relating to such activities from an early stage is important in terms of preparing for potential reporting and information-sharing requirements that may arise in the future.
The Regulation further provides that the taxonomy transition plan constitutes a complementary element of the report, and that the procedures and principles regarding transition plans and verification processes will be separately determined by the Climate Change Presidency. Accordingly, the scope of the implementation and the obligations that may arise for companies should be assessed together with the technical criteria, reporting templates and secondary legislation to be published in the future.
The Regulation is available here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
