The Taskforce on Nature-related Financial Disclosures (TNFD) announced today the release of the first beta version of its disclosure framework aimed at enabling and guiding organizations to report on evolving nature-related risks.
The TNFD was launched in June 2021, aiming to deliver a framework for organisations to report and act on nature-related risks, and building on the success of the Task Force on Climate-related Financial Disclosures (TCFD). According to the TNFD, the beta release marks a significant step towards enabling the market to address the risk of nature loss to the global economy, and to reduce the impact on nature.
David Craig, Co-Chair, TNFD, said:
“Building an improved understanding of nature and nature-related risks and opportunities is a critical enabler of better corporate strategy, better capital allocation decisions, better governance, and better risk management and disclosure practices. With climate change and nature-related impacts and risks increasing, it is essential companies incorporate natural assets into their strategic planning and risk management if they are going to succeed.”
The draft framework’s key components are comprised of foundational guidance encompassing science-based concepts and definitions, disclosure recommendations aligned with the TCFD’s approach to climate reporting, and guidance for companies and financial institutions to conduct nature-related risk and opportunity analysis.
The framework is being designed by the TNFD taskforce, consisting of over 30 senior executives chosen from across a broad range of sectors and disciplines, encompassing Financial Services, Corporates, and Market Service Providers. The TNFD has also partnered with several leading international sustainability-focused standard-setting, corporate reporting, and sustainable finance organizations, and the framework is being designed for alignment with sustainability standards currently under development by the International Sustainability Standards Board (ISSB).
TNFD member Dr Richard Mattison, President of S&P Global Sustainable1, said:
“As a member of the TNFD taskforce, I am delighted to support the release of the first beta version of the TNFD framework. Against the backdrop of net zero commitments from investors and companies, it is essential that net zero for climate should be net positive for nature. More than ever, investors and companies seek evidence-based insights, high quality data and advanced analytics from credible providers, including S&P Global Trucost, to support the decisions driving their strategies linking nature and business performance. The TNFD framework will be the key to unlocking better understanding, analysis and action around nature-related risks.”
The TNFD stated that it aims to release the next beta version of the framework in June, followed by updated versions in October 2022 and February 2023, with the final framework release anticipated in September 2023.
Elizabeth Mrema, Co-Chair, TNFD, said:
“The TNFD process is a unique collaboration between market participants and the world’s leading authorities in the science of nature and standard setting. The foundations we have laid are strong, driven by the market and grounded in the science.”