Legal & Regulatory News

TNFD publishes final Recommendations on nature related issues.

On 18 September 2023, the Taskforce on Nature-Related Financial Disclosures (TNFD) published its final Recommendations (the Recommendations). The TNFD is a market-based initiative which aims to encourage and aid the reporting of nature related risks and opportunities whilst also increasing the consideration by businesses and financial institutions of their impact on nature, nature risks, and the interrelationship between nature and climate.  

To ensure consistency, the fourteen recommended disclosures build on those of the Taskforce on Climate-Related Financial Disclosures (TCFD) and are aligned with the standards of the International Sustainability Standards Board, Global Reporting Initiative and Kunming-Montreal Global Biodiversity Framework.

The disclosures are grouped into four core pillars - governance, strategy, risk and impact management, and metrics and targets - and incorporate the eleven recommended disclosures of the TCFD and three additional disclosures:-  

• engagement: human rights policies and engagement activities with Indigenous Peoples, local communities and other stakeholders;
• locations: the locations of assets and/or activities that are either in material locations or sensitive locations, for example areas of high ecosystem integrity and/or of rapid decline in ecosystem integrity; and
• value chain disclosures: the method of identifying, assessing, and prioritizing the nature-related dependencies, impacts, risks and opportunities across the value chain.

The Recommendations were accompanied by additional guidance, including, “Guidance on the identification and assessment of nature-related issues: the LEAP approach” and specific guidance for financial institutions. The TNFD strongly encourage the voluntary adoption of the Recommendations, and the first businesses to do so will be announced in January at the World Economic Forum. The guidance for financial institutions, discussion paper on proposed sector disclosure metrics and discussion paper on proposed approaches to value chains are open to feedback.  

Click here to view the Recommendations.

Click here to read the press release.

Click here to read the “Guidance on the identification and assessment of nature-related issues: the LEAP approach”.

Click here to read “Getting started with adoption of the TNFD Recommendations”.

Click here to view the guidance for financial institutions.