EU Taxonomy Regulation What auditor evidence should teams keep for Taxonomy alignment

Build the evidence file around the four alignment conditions in Article 3 of Regulation (EU) 2020/852: substantial contribution to at least one environmental objective, no significant harm to the other objectives, compliance with minimum safeguards, and compliance with the Commission's technical screening criteria.

Do not describe every review as a mandatory audit. The Commission's Climate Delegated Act notice says some technical screening criteria contain specific verification requirements for certain activities; where the criteria require verification, the external verifier's report is evidence of compliance. For other activities, the file still needs enough documentation to let a reviewer trace the eligibility, alignment, DNSH, safeguards, and KPI decisions.

A review-ready file should let a person who was not involved in the original assessment reproduce the conclusion. Start with the activity boundary and the applicable delegated-act criteria, then connect each data point to the published disclosure line or KPI value it supports.

For Article 8 reporting, non-financial undertakings disclose turnover, capital expenditure (CapEx), and operating expenditure (OpEx) proportions associated with environmentally sustainable economic activities. The Disclosures Delegated Act also requires contextual information for financial undertakings, including scope, data sources, and limitations, so evidence should preserve the source and limitations behind each KPI.

Where Regulation (EU) 2026/73 is used to leave non-material activities unassessed, the review file should not imply that those activities failed eligibility or alignment. Retain the relevant KPI denominator, the cumulative 10% test, the activities omitted from assessment, and the amount reported separately as non-material.

Treat every technical screening criterion as an evidence requirement, even when the criterion does not prescribe a formal verifier. The Climate Delegated Act notice says compliance checking requires collecting and assessing relevant information; it also explains that all substantial-contribution criteria, DNSH criteria, and minimum social safeguards must be met for an activity to be considered Taxonomy-aligned.

Evidence depth should match the criterion. For example, the Commission notice discusses adequate evidence for building top-15-percent assessments, coherent adaptation plans for DNSH climate adaptation where climate risks are identified, and supplier information or testing for some Appendix C pollution-prevention checks.

A broad sustainability policy does not prove that a specific activity is Taxonomy-aligned. It does not show how the activity met the relevant technical screening criteria, DNSH checks, minimum safeguards, and KPI allocation rules.

A stronger file is narrower and more traceable: it names the activity, the criteria version, the reporting period, the data source, the calculation or allocation method, the reviewer, and the unresolved limitations. For CapEx allocated across mixed-use assets, the Commission notice says the allocation methodology should be based on verifiable evidence.