Editorial: The Government must come clean

But if Federated Farmers and Groundswell are to be believed, then the 'green' finance rules being devised by the Government risk doing real harm to rural communities.

The Sustainable Finance Taxonomy is being developed by the Centre for Sustainable Finance and the Ministry for the Environment to provide a consistent framework for defining what is 'green' or 'sustainable' in financial markets.

Federated Farmers says it would create major risks for New Zealand's agricultural sector and is urging the Government to halt the process entirely.

One of their core concerns is the lack of practical farming expertise involved in developing the taxonomy - there are no hands-on farmers involved with the Technical Advisory Group. Instead, it's full of shiny-shoed bankers, sustainability advisors, and forestry lobbyists, according to Feds.

In a letter sent to Ministers and key officials on July 11, Federated Farmers outlined a series of serious concerns with the Sustainable Finance Taxonomy.

Groundswell, which is keeping pressure on the Government to withdraw from the Paris climate change pact, claims under the taxonomy proposal, all farms would be classified as green, amber or red. If a farm is classified red, it is unable to align with Paris 1.5 degree and in the words of the proposal "the only way... is for them to be phased out".

The Government must come out and explain the NZ Taxonomy proposal.

Some farmers want the Government to disband the taxonomy process entirely, warning it will do more harm than good.

Critics believe that this isn't a path to sustainable finance. If their claims are right, that it is ideologically driven and practically unworkable, it risks serious harm to rural New Zealand.