In today's world, understanding and managing nature-related risks is crucial for businesses and financial institutions. Recognising this, the Taskforce on Nature-related Financial Disclosures (TNFD) was established to guide organisations in aligning their strategies with nature-positive outcomes. But what exactly is the TNFD and how does it apply to your business? Let's dive in! 🐬
What is the TNFD? 🌵
The Taskforce on Nature-related Financial Disclosures (TNFD) is a market based and science led global initiative that seeks to develop and deliver a risk management and disclosure framework for organisations to report and act on evolving nature-related risks. Launched in 2021, the TNFD's mission is to provide businesses and financial institutions with a comprehensive framework that integrates nature into decision-making processes, similar to how the The Taskforce on Nature-related Financial Disclosures (TCFD) has influenced climate-related disclosures.
Why is nature and the TNFD Important? 🐝
Nature is not just a "nice to have" – it is essential for economic stability and growth. The natural world underpins the the vital ecosystem services on which business and society depend, and which provide the foundation for every economy. However, these systems are in decline because of the business activities that rely upon them. The global economy is already operating outside the safe zones for six of the nine planetary boundaries. This poses serious risks for businesses, capital providers, financial systems and economies, and these risks are only increasing in severity and frequency. The TNFD provides a structured approach to understanding and responding to these risks and opportunities. Why nature matters – TNFD
The TNFD disclosure framework: recommended disclosures🍄
The Recommendations of the TNFD are based around four pillars, consistent with the Task Force on Climate-related Financial Disclosures (TCFD) and the International Sustainability Standards Board (ISSB).
- Governance: Disclose the organisation’s governance of nature-related dependencies, impacts, risks and opportunities.
- Strategy: Disclose the effects of nature-related dependencies, impacts, risks and opportunities on the organisation’s business model, strategy and financial planning where such information is material
- Risk Management: Describe the process used by the organisation to identify, assess, prioritise and monitor nature-related dependencies, impacts, risk and opportunities.
- Metrics and Targets: Disclose the metrics and targets used to assess and manage material nature-related dependencies, impacts, risks and opportunities.
Getting started 🌍
A good first step is to join the following groups to increase learning and build capacity:
Next, the TNFD have outlined 7 key steps for getting your organisation started on nature-related assessment and disclosure:
- Deepen your understanding of the fundamentals of nature. Why not have a look at our Business & Nature Toolkit, a great place to get you started!
- Make the business case for nature and gain buy-in from the board and management. Looking at dependencies of your business on nature can help.
- Start with what you have, leveraging other work. Carbon work often provides a good starting point with data points.
- Plan for progression over time and communicate your plans and approach. As your understanding and data quality improves, more progress can be made.
- Encourage collective progress through engagement. We need many imperfect actions rather than one business doing it perfectly.
- Monitor and evaluate your own adoption progress.
- Register your intention to start adopting the TNFD recommendations.
For more details see the TNFD getting started guide:
Getting started with adoption of the TNFD recommendations
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