Investments are required to successfully transition toward carbon neutrality and a circular economy. Private capital flowsshould be reoriented toward environmentally sustainable economic activities. Thus far, the European Union (EU) has beendeveloping sustainable finance policies. Representative actions to implement the policies include the establishment of theESG Technical Screening Criteria (TSC) and disclosure standards. Moreover, the proportions of turnover, capitalexpenditure, and operating expenditure are stipulated as key performance indicators that companies should disclose inrelation to economic activities that are environmentally sustainable. The TSC requires that companies’ economic activitiesmake a substantial contribution to six environmental objectives and adhere to the Do No Significant Harm (DNSH)principle. Provisions in the Taxonomy Regulation on the TSC and Corporate Sustainability Reporting Directive mandatethe sustainability reporting of companies and set forth the rules to establish disclosure standards, indicating that they aredesigned to facilitate an interconnected and harmonized implementation. In conclusion, the EU’s sustainable financepolicies demonstrate its commitment to establishing a financial framework for facilitating a seamless green transition inbusiness practices to ultimately achieve a transition to a sustainable economy. Therefore, Korea must take proactive stepsto establish future directions and principles for its industries, which would enable a successful transition of their businessactivities to economic sustainability.