Mongolia Launches SDG Finance Taxonomy Version 2.0 with EU and UNDP Support
Ulaanbaatar, 20 August 2026. Mongolia launched the SDG Finance Taxonomy Version 2.0 today at the COP17 which the country is hosting. The launch marks major step in Mongolia’s efforts to build a financial system that supports sustainable development.
Taxonomy is a classification tool for identifying green and sustainable economic activities providing a common language for policy makers, financial institutions and businesses, while strengthening transparency and reducing the risk of greenwashing. Mongolia adopted its National Green Taxonomy in 2019 becoming one of the earliest adopters of taxonomy globally, followed by the SDG Finance Taxonomy in 2023, which broadened the framework beyond green activities to include environmental and social priorities aligned with the Sustainable Development Goals. The framework was subsequently tested against real loan portfolios, generating practical lessons and assessed against internationally agreed common taxonomy principles that informed the development of Version 2.0.
The revised Taxonomy now adopts a Technical Screening Criteria methodology incorporating credible, science-based criteria to identify sustainable economic activities, in alignment with international taxonomies to ensure interoperability across regions and countries. Transitioning from a whitelist-based approach, Version 2.0 introduces a more rigorous assessment approach based on three key principles: an activity must make a Substantial Contribution to an environmental or social objective, Do No Significant Harm to other sustainability objectives, and meet Minimum Social Safeguards.
SDG Finance Taxonomy
During the presentation of the SDG Finance Taxonomy Version 2.0, Mr. Amarbayasgalan Batbaatar, Chair of the Taxonomy Technical Working Group and Director-General of Financial Policy Department, Ministry of Finance said “For Mongolia, a clearer and more credible Taxonomy can help channel financing towards areas with significant sustainable investment potential, including renewable energy and energy efficiency, sustainable agriculture and livestock, water management and land restoration. It can also provide domestic and international investors with a more consistent basis for identifying investments that contribute to Mongolia’s environmental and social priorities.”
SDG Finance Taxonomy
Revision of SDG Finance Taxonomy Version 2.0 was supported by the European Union Sustainable Finance Advisory Hub with United Nations Development Programme as implementing partner. H.E. Ms. Ina Marčiulionytė, Ambassador of the European Union to Mongolia said at the launch “The taxonomy helps identify economic activities that contribute meaningfully to sustainability objectives, while strengthening transparency and reducing the risk of greenwashing. The European Union is pleased to partner in this process and stands ready to continue supporting Mongolia in this journey.”
This comes at a time when Mongolia is seeking to mobilize greater investment for its green transition. In October 2025, European Investment Bank Global and the Government of Mongolia signed a memorandum of understanding under the EU’s Global Gateway strategy aimed at unlocking up to €1 billion in investment for Mongolia’s green transition. The revised Taxonomy can support these efforts by providing investors, financial institutions and businesses with a shared understanding of what qualifies as sustainable investment.
SDG Finance Taxonomy
Version 2.0 was developed through an extensive consultation process involving more than 70 organizations, including the Ministry of Finance-chaired Technical Working Group, sectoral sub-working groups, regulators and financial institutions. It will now be submitted to the Financial Stability Council for formal endorsement. The next phase will focus on practical guidance, sector-specific tools and capacity building to help regulators and financial institutions apply the Taxonomy consistently in their day-to-day financing and investment decisions.
As Mongolia moves from framework development to implementation, the Taxonomy Version 2.0 can help strengthen the credibility and transparency of the country’s sustainable finance market and create clearer pathways for domestic and international capital to support investments that deliver environmental, social and economic benefits.
SDG Finance Taxonomy
About European Union
The European Union is an economic and political union of 27 European countries. It is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities. It acts globally to promote sustainable development of societies, environment and economies, so that everyone can benefit.
About European Union Sustainable Finance Advisory Hub
Launched in 2024, the EU Sustainable Finance Advisory Hub provides support to low- and middle-income countries with the development of sustainable finance taxonomies, disclosure and green bond frameworks.
About UNDP
UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and planet.