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Reform Support

Do No Significant Harm (DNSH) Guidelines for Implementing the Green Transition in Finland

Funding Programme
Technical Support Instrument (under the European Recovery and Resilience Facility)
Year
2022

Supporting reforms to ensure efficient and effective revenue administration and public financial management.

The Commission supports the Finnish authorities to implement the DNSH criteria to fund the decision-making process with a view to advance the green transition. The main beneficiary is The Ministry of the Environment, with close involvement of Ministries of Finance, and Economic Affairs and Employment.

Context

The European Green Deal aims to make Europe climate neutral by 2050. Finland has, however, decided to take this one step by pledging to carbon neutrality by 2035. Finland’s Sustainable Growth Programme funded by the EU’s recovery package, “Next Generation EU”, is instrumental for reaching this goal. As part of the Programme, Finland has allocated about 50% of Recovery and Resilience Facility (RRF) funds to support the domestic green transition. The RRF funding must follow the “Do No Significant Harm” (DNSH) principle defined by Article 17 of the Taxonomy
Regulation.

The principle is also reflected to various degrees in Regulations establishing other EU funding programmes such as the Just Transition Fund, the InvestEU, Horizon Europe and the European Regional and Development Fund.

This principle can also be recognised - though to a lesser extent- in other established EU funded programmes such as the Just Transition, InvestEU, Horizon Europe and the European Regional and Development Fund.


Finland intends to increase its administrative capabilities, as well as its knowledge of the application of the DNSH principle. These measures will ensure that reforms and investments planned across the country are in line with EU, as well as national climate environmental targets.

Support delivered

The Finnish authorities are provided support (by the EU) in three interlinked project phases between 2022 and 2024. These include but are not restricted to:

  • Identifying and understanding the green transition investment needs and gaps in Finland.
  • Providing ad hoc support to apply the DNSH guidelines in selected pilot cases, and organise two seminars to present the results of the project

Results achieved

The project provides guidance to Finnish authorities in implementing the “Do No Significant Harm” (DNSH) criteria in funding decisions. As a result, Finnish authorities will gain a thorough understanding of how public funds are currently directed to help achieve climate and energy objectives. They will develop the capacity to quickly and reliably make funding decisions that accelerate the green transition and do not harm the environment (do not negatively impact the environment). The project will contribute to the implementation of the European Green Deal by allocating public which will go towards green priorities.

Lessons learned from a variety of pilot cases and clear guidelines will be shared with the Commission and EU Member States to contribute to good practice approaches for integrating the DNSH into public funding processes.

Knowledge shared will include findings garnered from pilot cases and clear guidelines for the Commission and EU Member States will also be provided. This will contribute to the understanding of good practices which will further integrate DNSH into public funding processes.