Advancing China's Sustainable Blue Economy 2025

23The Principles offer an overarching chapeau for the emerging blue finance ecosystem. It is therefore important to seek linkages and alignment between the Principles and other functional parts of the blue finance ecosystem. Most notably, the Task Force on Nature-related Financial Disclosures (TNFD) is a corporate disclosure framework for finance institutions to report and act on evolving nature-related risks54. By providing criteria and metrics on nature-related impacts and dependencies, it aims to increase transparency across the sector and encourages consistent reporting. The TNFD’s focus is broad in terms of biodiversity, but the task force is currently developing criteria that is strongly aligned with UNEP FI guidance for a number of ocean sectors. 4.1.2 Insights from the international experience While these emerging initiatives and voluntary frameworks have a significant role to play in shaping ocean-related guidance and in driving the transition toward an SBE, it is important that SBE sectors are included in national “sustainable” finance taxonomies — classification systems that provide regulators and financiers clarity on the activities, assets and project categories that deliver on key climate, green and blue, social and sustainable objectives55. By providing environmental performance criteria to define what constitutes sustainable activities across different sectors56, they deliver integrity within the sustainable financial market and allow governments to track capital flows to “sustainable” sectors. This enables them to assess whether sufficient capital is flowing to targeted sectors to meet national biodiversity and climate commitments57. By way of example, within the EU green taxonomy, introduced in 2020, economic activities must respect three criteria, namely (i) substantially contribute to one or more environmental objectives of the taxonomy; (ii) do no significant harm (DNSH) to any other environmental objectives of the taxonomy; and (iii) respect social safeguards. To guide the second category, UNEP FI’s guidance includes a recommended exclusion list for activities that cause significant harm to nature and people58. Given the significant contribution of the ocean to national economies59 and the risks associated with unsustainable business-as-usual practices60, the development of blue taxonomies and their integration with national policies and development plans should be prioritized. Current sustainable finance taxonomies (47 as of April 2024 61) are primarily based on terrestrial sectors, however, so targeted action is needed to scale the blue dimension. As a minimum, sustainable blue finance taxonomies need to be forward-looking and grounded in robust ocean science to incentivize and guide corporate transition to operate 54 TNFD, Recommendations of the Taskforce on Nature-related Financial Disclosures, 2023, https:/ /tnfd.global/wp-content/uploads/2023/08/Recommendations_of_the_Taskforce_on_ Nature-related_Financial_Disclosures_September_2023.pdf . 55 Nicholas Pfaff, Özgür Altun, and Yanqing Jia, Overview and Recommendations for Sustainable Finance Taxonomies, 2021, https:/ /www.icmagroup.org/assets/documents/Sustaina - ble-finance/ICMA-Overview-and-Recommendations-for-Sustainable-Finance-Taxonomies-May-2021-180521.pdf . 56 WWF, When Finance Talks Nature, 2022, https:/ /wwfint.awsassets.panda.org/downloads/when_finance_talks_nature.pdf . 57 Jena, L.P., Tandon, G., Creating Effective Sustainable Finance Taxonomies, 2025, https:/ /www.orfonline.org/public/uploads/posts/pdf/20250211110942.pdf . 58 UNEP FI, “Recommended Exclusions for Sustainable Blue Economy Financing, 2021, https:/ /www.unepfi.org/publications/turning-the-tide-recommended-exclusions . 59 WWF, Reviving the Ocean Economy, 2015, https:/ /wwf.panda.org/discover/our_focus/oceans_practice/reviving_the_ocean_economy/ . 60 “Navigating Ocean Risk: Value at risk in the global blue economy”, WWF & Metabolic, 2021, https:/ /value-at-risk.panda.org/#recommendations . 61 Sustainable Banking and Finance Network (SBFN), 2024, SBFN Toolkit. Sustainable Finance Taxonomies, https:/ /www.sbfnetwork.org/sbfn-toolkit-sustainable-finance-taxonomies/ . 62 OECD, 2020, Developing Sustainable Finance Definitions and Taxonomies, Green Finance and Investment, 2020, https:/ /doi.org/10.1787/134a2dbe-en .within planetary boundaries. Successful implementation of sustainable blue finance taxonomies should address regulatory integration, harmonization and improvements in data availability7. Alignment through a common set of principles, such as the Sustainable Blue Economy Finance Principles, definitions and sustainability objectives, would ensure ocean-related technical screening criteria and performance metrics are aligned to climate and biodiversity commitments and are interoperable across markets. They should also be reviewed regularly, to integrate the latest environmental science and technology innovation, and should be consistent with international guidance, such as the UNEP FI guidance, and corporate disclosure standards, such as the Task Force on Climate-related Financial Disclosures (TCFD) and TNFD. It is also key to have mandatory reporting requirements, as is the case for the EU and China62, where the Green Industry Guiding Catalogue is mandatory for sustainable financing activities. Uptake, alignment and adoption of standardized SBE frameworks, principles, guidance, tools, criteria and metrics will require regulators and the finance sector to view ocean risks as material and to fully recognize the strong opportunities offered by a “sustainable” blue economy. Patrick Yeung