TNFD welcomes the ISSB’s decision to commence work on nature-related issues

London | April 24, 2024

The Taskforce on Nature-related Financial Disclosures (TNFD) welcomes the decision of the International Sustainability Standards Board (ISSB) to commence work on nature-related issues drawing on the recommendations of the TNFD. This is a critical next step in developing the global baseline for sustainability reporting following the release of its IFRS S1 and IFRS S2 sustainability reporting standards in 2023.  The TNFD looks forward to continuing to work closely with the ISSB on the research and development of its nature-related standard setting work.

Following the release of the TNFD recommendations in September 2023, the roll out of the European Sustainability Reports Standards (ESRS) and the recent update to the GRI biodiversity standard (GRI Biodiversity 101), the ISSB announcement is another important step forward for nature-related corporate reporting. The further incorporation of nature-related issues into the global reporting baseline, drawing on the work of the TNFD, will provide investors and report preparers with a more integrated approach across governance, strategy, risks management and metrics and targets. It will also help to realise the achievement of Target 15 of the Global Biodiversity Framework, which called for nature-related corporate reporting of risks, dependencies and impacts, and was agreed to by over 190 countries in December 2022.

The TNFD’s recommendations have already been designed to provide a high level of consistency in the structure, approach and language used not only by the TCFD, but also in the ISSB’s existing IFRS S1 and IFRS S2 standards. Companies now assessing and beginning to report their nature-related issues using the TNFD recommendations and guidance are well placed to report against ISSB standards relating to nature and biodiversity.

Furthermore, the TNFD recommendations have already informed the reporting landscape in Europe and the GRI impact reporting standards used by companies globally. In Europe, climate and nature-related reporting requirements were released in 2023 under the Corporate Sustainability Reporting Directive (CSRD). They are consistent with the TNFD’s recommended disclosures and application requirements for the European Sustainability Reporting Standards (ESRS) suggest the use of the TNFD’s LEAP assessment approach. Similarly, the GRI’s recently updated Biodiversity 101 impact standard is also highly aligned to the TNFD recommendations.

As the ISSB commences its work to further consider nature-related reporting requirements, the TNFD stands ready to make available its research and insights from over 200 pilot tests and two years of extensive engagement and feedback from investors, companies and other market participants. Over 370 organisations from more than 45 countries representing in excess of US$15 trillion in Assets under Management (AUM) have already committed to start making disclosures based on the TNFD recommendations, including 25% of the world systemically important banks. An increasing number of leading asset owners and asset managers are now calling for TNFD-aligned disclosures through their stewardship guidelines and activities with investee companies.  Only six months after the publication of the TNFD recommendations in September 2023, companies and financial institutions have already begun publishing TNFD-aligned disclosure reports.

David Craig, Co-Chair of the TNFD, said today:

“This is another important step forward to realizing both the need for an integrated global baseline for sustainability reporting and the aspirations of the Global Biodiversity Framework. The science is clear that climate change and nature loss are accelerating and market research is increasingly spotlighting how our dependencies and impacts on nature are creating material financial risks and also opportunities for companies across real economy sectors as well as for financial institutions.

We have been delighted to have had the ISSB alongside the TNFD as a knowledge partner for the past two years informing our work on a set of market-based recommendations.  We are now delighted to be able to support their translation of our recommendations into a set of specific IFRS reporting standards going beyond climate to incorporate the whole natural system upon which business and finance depend.”

The TNFD also welcomes the ISSB’s ongoing commitment to proportionality of reporting requirements, connectivity to existing accounting standards and the strengthening of interoperability through collaboration with other standards approaches and organisations such as the Global Reporting Initiative (GRI) and the European Financial Reporting Advisory Group (EFRAG). We look forward to continuing to work with all of these partners to minimize duplication, complexity and fragmentation in corporate reporting and accelerate the shift towards integrated sustainability reporting.  

Download the full press release here

ENDS

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Notes to Editors

About the TNFD

The Taskforce on Nature-related Financial Disclosures (TNFD) is a market-led, science-based and government-backed initiative providing organisations with the tools to act on evolving nature-related issues.   It was launched in June 2021 with the support of the G20 Sustainable Finance Working Group and financial support from a number of governments and philanthropic foundations. 

In September 2023, after a two-year design and consultation phase with market participants, the TNFD published its disclosure recommendations and supporting implementation guidance to encourage and enable business and finance to assess, report and act on their nature-related dependencies, impacts, risks and opportunities aligned to Target 15 of the Global Biodiversity Framework (GBF). 

With its corporate reporting recommendations published, the Taskforce is now focused on encouraging and enabling voluntary market adoption, working with standards bodies such as the ISSB and GRI and supporting efforts to address the knowledge, capacity building and data needs of market participants.     

The Taskforce is comprised of 40 senior executives drawn from leading financial institutions, corporates and market service providers, with combined assets of over US$20 trillion. Twenty core knowledge partners from leading science, standards, and data bodies support the work of the Taskforce. A group of over 1,400 organisations support the work of the Taskforce as institutional members of the TNFD Forum. Over 370 organisations globally have now committed to start reporting on their nature-related issues aligned to the recommendations of the TNFD and disclosure reports are now being published by a range of early adopters.   

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