After the controversial EU classification of gas and nuclear power plants as climate-friendly investments, environmental organizations set up their own "green" financial label.

With it, banks, investors and insurers can check whether their investments are climate-friendly based on scientific criteria, according to a statement by several organizations including WWF, Ecos and the European consumer association Beuc on Wednesday.

"The initiative seeks to bring clarity to investors after the EU designated gas-fired power plants, nuclear power plants, tree burning, intensive deforestation and other harmful activities as 'sustainable' in the EU taxonomy," the organizations wrote.

Investments to fight climate change

In the taxonomy, the EU lists sectors in which investments can be made to combat climate change. Since the beginning of January, investments in gas or nuclear power plants have also been classified as climate-friendly. This had led to great discussions and criticism from environmental organizations, since the burning of gas emits climate-damaging CO2 and nuclear fission produces radioactive waste. Austria and Luxembourg as well as several organizations are suing against the EU taxonomy.

The WWF, Ecos and other environmental organizations now want to create "strict criteria" with their own taxonomy so that financial institutions can better assess what is climate-friendly and what is not. In concrete terms, all economic activities are to be gradually classified as green, yellow or red according to a traffic light principle. The criteria for this are to be checked regularly by a group of independent experts.