Launch of the Thailand Green Taxonomy will accelerate the country’s decarbonization drive. On the 5th of July, Thailand officially adopted the Green Taxonomy, marking a seminal moment for the country's climate policy. The Green Taxonomy provides a blueprint for a green future, guiding the nation’s business community, government, and experts in their efforts to combat climate change.

Alfred Tang

Hatched by Alfred Tang

Nov 06, 2023

4 min read

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Launch of the Thailand Green Taxonomy will accelerate the country’s decarbonization drive. On the 5th of July, Thailand officially adopted the Green Taxonomy, marking a seminal moment for the country's climate policy. The Green Taxonomy provides a blueprint for a green future, guiding the nation’s business community, government, and experts in their efforts to combat climate change.

The Green Taxonomy in Thailand is an ambitious initiative that aims to expand to other key sectors in the future. In its initial phase, it covers only two sectors, namely energy and transportation. By focusing on these sectors, Thailand aims to address the significant carbon emissions associated with energy production and transportation systems.

What sets the Thailand Green Taxonomy apart is its emphasis on science, specificity to Thailand, and its experience-based approach. The taxonomy is science-guided, meaning that it is based on the latest scientific research and evidence. This ensures that the criteria for defining green activities are in line with the most up-to-date understanding of environmental sustainability.

Moreover, the Thailand Green Taxonomy is specifically tailored to the country's unique circumstances. Thailand faces distinct challenges and opportunities when it comes to decarbonization, and the taxonomy takes these into account. By considering the local context, the taxonomy can provide targeted guidance and support to businesses and policymakers, enabling them to make informed decisions that align with Thailand's decarbonization goals.

Another key aspect of the Thailand Green Taxonomy is its focus on being greenwash-proof. Greenwashing refers to the misleading or deceptive marketing practices used by companies to portray themselves as environmentally friendly when they are not. To ensure that the taxonomy is not exploited for greenwashing purposes, it includes rigorous criteria and verification processes. This will help maintain the integrity of the taxonomy and ensure that only genuinely green activities receive the green label.

Thailand's decision to launch the Green Taxonomy is driven by its deep understanding of the catastrophic consequences of climate change. The country has experienced firsthand the impacts of extreme weather events, rising sea levels, and biodiversity loss. By adopting the Green Taxonomy, Thailand is taking a proactive stance in addressing these challenges and accelerating its decarbonization efforts.

In addition to the launch of the Green Taxonomy, Thailand is also planning to align its sustainability disclosures with international financial reporting standards (IFRS). This move aims to enhance the quality and transparency of sustainability information. The plan is to require listed companies with a capital of over 10 billion baht to prepare sustainability information by 2026 and disclose it externally by 2027.

Aligning sustainability disclosures with international standards is crucial for several reasons. Firstly, it enables comparability of sustainability performance across different companies and sectors. This allows investors and stakeholders to make informed decisions based on standardized and reliable information. Secondly, it enhances transparency and accountability, as companies will be required to disclose their environmental and social impacts in a consistent and systematic manner. Lastly, it signals Thailand's commitment to global sustainability efforts and aligns the country's reporting practices with international best practices.

In conclusion, the launch of the Thailand Green Taxonomy and the plan to align sustainability disclosures with international standards are significant steps towards a more sustainable future. These initiatives provide a clear roadmap for businesses, government agencies, and experts to drive decarbonization efforts and ensure that sustainability remains a priority in Thailand. To further support these efforts, here are three actionable pieces of advice:

  • 1. Embrace the Green Taxonomy: Businesses should familiarize themselves with the criteria and guidelines outlined in the Green Taxonomy and strive to align their activities with the defined green standards. This will not only contribute to the country's decarbonization goals but also enhance their reputation as environmentally responsible entities.
  • 2. Invest in Sustainability Reporting: Companies should start preparing for the upcoming requirement to disclose sustainability information by investing in robust reporting systems and processes. This will enable them to collect, measure, and report on their environmental and social impacts accurately and transparently.
  • 3. Collaborate for Impact: To effectively address the challenges of climate change and achieve sustainable development, collaboration is key. Businesses, government agencies, and experts should work together to share knowledge, resources, and best practices. By leveraging collective efforts, Thailand can accelerate its decarbonization drive and create a greener, more sustainable future for all.

By adopting these actionable advice and leveraging the opportunities presented by the Thailand Green Taxonomy and international sustainability reporting standards, Thailand can make significant progress in its decarbonization journey and contribute to global efforts to mitigate climate change.

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