Final recommendations published by Taskforce on Nature-related Financial Disclosures

The Taskforce on Nature-related Financial Disclosures (TNFD) has published its final recommendations for nature-related risk management and disclosure. In addition, it has released guidance aimed at helping market participants get started with integrated assessment and corporate reporting related to nature. The TNFD said the recommendations “are a key milestone in the relationship between nature, business and financial capital, positioning nature risk alongside financial, operational and climate risk and helping to shift capital flows to nature-positive outcomes”. It added that the recommendations aim to inform better decision-making by companies and capital providers, and ultimately contribute to a shift in global financial flows toward nature-positive outcomes and the goals of the Kunming-Montreal Global Biodiversity Framework. The framework and guidance come at a critical time, with rapidly growing interest across business and finance globally on nature and biodiversity issues. Policymakers, regulators, asset owners, asset managers and leading global companies are all increasing their focus on nature-related risk management and the necessity of mobilising private sector engagement and finance to tackle nature loss and scale-up nature-based solutions, said the taskforce. The recommendations build on those of the Task Force on Climate-related Financial Disclosures (TCFD) and are consistent with the global sustainability standards of the International Sustainability Standards Board and the impact materiality approach used by the Global Reporting Initiative and incorporated into the new European Sustainability Reporting Standards. They are also aligned with the requirement of Target 15 of the Global Biodiversity Framework for corporate reporting, which calls for assessment and disclosure of nature-related risks, impacts, and dependencies, enabling companies to align their corporate reporting with global policy goals as they are now doing on climate related issues. David Craig, co-chair of the TNFD and founder and former CEO of Refinitiv said: “Nature loss is accelerating, and businesses today are inadequately accounting for nature-related dependencies, impacts, risks and opportunities. Nature-risk is sitting in company cash flows and capital portfolios today. The costs of inaction are mounting quickly. Businesses and financial institutions now have the tools they need to take action.” He added: “Building on the language, structure and approach of the TCFD and consistent with the ISSB’s sustainability reporting baseline, the adoption of the TNFD Recommendations represent a step-change in the momentum and capacity for business and finance to identify, assess and disclose their exposure to nature-related issues in a manner consistent with climate-related-reporting.” The TNFD said it will now encourage and support voluntary market adoption of the recommendations. Following the example of the TCFD, the TNFD will track voluntary market adoption on an annual basis through an annual status update report beginning in 2024. The TNFD noted that GSK has already announced it is committed to publishing its first TNFD disclosures from 2026, based on 2025 data. The recommendations are science based and voluntary, building on the market’s experience with, and progress on, climate-related reporting, and incorporate the same four conceptual pillars as the TCFD disclosure framework. Governance: The governance processes, controls and procedures the organisation uses to monitor and manage nature-related issues; Strategy: The approach the organisation uses to manage nature-related issues; Risk & Impact Management: The process used by the organisation to identify, assess, prioritise and monitor nature-related dependencies, impacts, risks and opportunities; Metrics & Targets: The metrics and targets used to assess and manage material nature-related dependencies, impacts, risks and opportunities. They are intended to serve as a starting point for companies to begin identifying, assessing and disclosing the nature-related issues in their own time, and subject to their own strategy, materiality, cost and capability considerations.

Final recommendations published by Taskforce on Nature-related Financial Disclosures

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