Thailand’s Taxonomy launch: a new reference for climate-aligned investment in Southeast Asia

On 27 May 2025, Thailand officially launched its national sustainable finance taxonomy, establishing a regionally significant framework to guide investments towards climate-resilient, net-zero development. 
 

Developed by the Thailand Taxonomy Board[1], and supported by the International Finance Corporation (IFC), Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and Asian Development Bank (ADB), this taxonomy is a major milestone in Southeast Asia’s growing sustainable finance ecosystem. It reflects international best practices while being tailored to the country’s unique climate, economic, and sectoral realities. 
 

The taxonomy’s development took place over three years and was completed in two distinct phases. Phase 1 began in June 2022, focusing on core sectors such as energy and transport. Phase 2 extended the taxonomy’s coverage to manufacturing, construction, waste, agriculture, and aquaculture—introducing some of its most innovative and globally distinctive features. 
 

Climate Bonds Initiative served as a primary technical partner throughout both phases, contributing methodology, thresholds, and implementation support. 

Why It Matters 
 

Thailand is among the countries most vulnerable to the impacts of climate change— it currently ranks 24th in the 2025 Climate Change Performance Index (CCPI), reflecting strong performance in reducing greenhouse gas emissions but ongoing challenges in climate policy and renewable energy adoption. The country has improved its resilience, moving from the 9th to the 30th place in the latest Climate Risk Index for 1993–2022, though it remains highly vulnerable to floods, droughts, and heatwaves.  
 

In this context, the Thailand Taxonomy is more than a policy tool—it is a critical reference for aligning financial flows with long-term resilience and net-zero goals, both nationally and across the Southeast Asian region. 

A Science-Based Framework 
 

The taxonomy uses a traffic light classification system to assess economic activities: 
 

• Green: Activities aligned with a 1.5°C trajectory or already low-emission; 
   

• Amber: Transitional activities that can become green, with time-bound emissions thresholds or retrofit plans; 
   

• Red: Activities incompatible with the taxonomy’s decarbonisation objectives and expected to be phased out. 
   

This system builds on Climate Bonds Initiative’s Financing Credible Transitions methodology, adapted to Thailand’s national context through a multi-stakeholder process. 

Key Innovations 
 

1. Aquaculture Guidance – A Global First 
   Thailand’s taxonomy is the first globally to introduce a list of recommended practices for aquaculture, reflecting the significance of the sector in Thailand’s economy and environmental footprint. 
    

2. Expanded Sector Coverage – Including Manufacturing 
   It includes Paris-aligned criteria for manufacturing, even for traditionally low-emission subsectors, using emissions reduction trajectories aligned with Science-Based Targets initiative (SBTi) benchmarks. 
    

3. DNSH Flexibility with Accountability 
   A three-year remediation period allows users to address outstanding gaps in Do No Significant Harm (DNSH) and Minimum Social Safeguards (MSS) compliance while remaining eligible under the taxonomy—encouraging practical implementation without compromising on environmental and social integrity. 
    

A Regional Model 
 

Thailand’s taxonomy is the first national taxonomy in ASEAN to combine several key features into one integrated framework: 
 

• A transition finance methodology, based on Climate Bonds’ internationally recognised framework 
   

• Practice-based agricultural guidance 
   

• Sector-specific technical thresholds, with clear screening and sunset criteria 
   

Thailand’s model brings depth guidance into a nationally implemented taxonomy. It sets a new precedent for how emerging economies can design tools that are globally aligned and locally grounded. 

To learn more, read the official press release from the Bank of Thailand. 

‘Til Next Time 

Climate Bonds