More than 400 firms adopt TNFD recommendations for nature disclosure

The Taskforce on Nature-related Financial Disclosures (TNFD) has announced a 30% uptick in companies disclosing and reporting their nature-related impacts since January, with more than 400 organisations now aligned to the framework.

More than 400 firms adopt TNFD recommendations for nature disclosure

The TNFD announced in January that 320 organisations across a variety of sectors and countries have aligned themselves with the disclosure framework.

To mark London Climate Action Week (LCAW) the TNFD has revealed that 96 organisations are now aligned with the framework, bringing the total number of organisations to 416.

Organisations represent more than 50 jurisdictions and 62 sectors. The publicly listed companies represent more than $6trn in market capitalisation and the 114 financial institutions classed as TNFD Adopters represent $15.9trn in assets under management.

The latest firms to align with the framework include investors LGIM, car maker Volvo, print solutions firm Richo and Mengniu Dairy from China.

TNFD Co-chair David Craig said: “The ongoing uptake of the TNFD’s recommendations is further evidence that the mindset in business and finance is quickly shifting to a recognition that accelerating nature loss is imposing costs and risks on society as a whole as well as to individual business models and capital portfolios.

“Voluntary uptake now of the TNFD recommendations is the best way to meet these shifting expectations and the best way to meet new regulatory requirements such as CSRD. We are delighted that organisations globally are also using TNFD to prepare for the forthcoming expansion of the global sustainability reporting baseline now that the ISSB has commenced its important work on nature building on the recommendations of the Taskforce”.

The TNFD recommendations intend to mitigate the industrial impact on nature by encouraging comprehensive reporting on businesses’ environmental footprint and properly integrating nature-related considerations in their strategies. In turn, this gives investors access to better-quality data.

After two years of design and development, the TNFD unveiled its 14 recommended disclosures and a suite of additional implementation guidance at Climate Week NYC on 18 September 2023.

The 14 reporting recommendations encompass guidelines for revealing nature-related impacts, risks, and dependencies throughout the entire value chain. Similar to the framework presented by the Taskforce on Climate-Related Financial Disclosures (TCFD), these recommendations involve assessing risk in a range of future scenarios.

The TNFD has this week published new additional, sector-specific guidance. New sector guidance has been updated for food and drink, pharmaceuticals, forestry and paper, metals and mining, and oil and gas amongst others.

Reporting frameworks

Through alignment with the TNFD’s disclosure requirements, companies will provide information in a standardised manner to stakeholders, including regulators and investors.

Indeed, a wealth of standards, frameworks and initiatives are emerging to help businesses measure their nature-related impacts, risks and opportunities.

Business for Nature named the first business biodiversity strategies it had assessed and found to be aligned with the principles of its Nature Strategy Handbook back in May.

The Science Based Targets Network (SBTN) is approaching the final stages of its pilot programme for science-based targets for businesses focused on nature conservation, with the first set of validated targets expected to be published later this year.

As 2024 began, the new GRI Biodiversity Standard was introduced, incorporating the science-based targets for nature approach. This integration aims to facilitate companies in effectively managing and publicly disclosing their impacts on nature, including biodiversity.

This year, several national governments are set to signal their support for mandatory reporting in line with the International Sustainability Standards Board’s (ISSB) first two standards, which are predominantly focused on climate but do contain nature-related elements. The ISSB itself will also set out its next priority topics for standards; nature is a likely pick.

Action inspires action. Stay ahead of the curve with sustainability and energy newsletters from edie