Is your organisation ready to become nature positive?
At a glace
‘Nature positive’ is the ‘net zero’ for nature. According to the Nature Positive initiative, this refers to halting and reversing of biodiversity loss through measurable gains in the health, abundance, diversity and resilience of species, ecosystems and processes. Nature-based goals and plans must form a key component of any sustainability strategy. Yet, assessing, reporting and acting on nature-related risks is new territory. With more than half the world’s gross domestic product highly to moderately dependent on nature, biodiversity and ecosystems are being degraded, overexploited and are under a growing threat from climate change. Organisations are being called upon to address their impacts on the natural world.
How to prepare for the Taskforce on Nature-related Financial Disclosures (TNFD) recommendations
A new global reporting framework aims to support this movement. The TNFD is a market-led, science-based and government supported initiative that provides a risk management and disclosure framework for organisations to report and act on evolving nature-related risks. This article provides an overview of insights and learnings from the companies who have been piloting the beta framework, as well as some guidance on getting started on your nature-positive journey.
The TNFD framework guides organisations on the assessment and disclosure of nature related risks and opportunities to protect, restore and promote the sustainable use of nature. What’s the end goal? To create a shift in global financial flows – away from nature-negative outcomes, and toward nature-positive outcomes.
The first ‘beta’ framework was released in March 2022. Since then, additional releases have been rolled out and have continued to gather insight and feedback along the way through pilot programs. Around 200 organisations globally and across sectors tested aspects of the framework. As your organisation looks to get on the front foot and align to upcoming TNFD recommendations, below are some of the key findings from organisations who have been applying draft recommendations.
Companies just starting out on their nature-positive journey will likely need more guidance to refine the process, applicability, and value to their business models
- Identify materiality: Determine which nature-related issues are material to your organisation and operations, including the value chain. Materiality assessment involves identifying the environmental risks and opportunities that are most relevant and significant to your business. This process may involve engaging with relevant stakeholders, conducting environmental impact assessments, and considering your organisation's supply chain. The pilot outcomes showed that conducting an initial qualitative assessment can more effectively prioritise which business units require more detailed effort to determine impacts.
- Evaluate gaps: Gaining a deeper understanding of what being nature positive requires means undertaking gap analyses across existing commitments, practices, and management tools. To develop tangible actions, the gap analysis must be informed by an organisation’s operations. This process is critical to integrating a nature-positive aligned and explicit approach into strategic business planning and processes. It also serves to identify capacity and skills gaps needed to embed them. Determining current gaps across data and metrics, nature scenarios, supply chain traceability, and risk valuation is critical.
- Review (and rely on) previous disclosures: Does your organisation currently use climate-risk assessments or Taskforce for Climate-related Financial Disclosures? Assessing nature-related risks may be easier for organisations which are already familiar with existing climate reporting and disclosure processes. Regardless, companies embarking on their first steps will likely need more resource allocation to conduct robust assessments.
Pulling sustainability out of its silo to become a cross-company effort
- Enhance internal training and awareness: More effort is required to improve organisational technical expertise and understanding of the climate and nature nexus alongside the resulting financial risks. Internal education and awareness are key.
- Sustainability requires a whole-of-society and organisational approach: The shift from nature negative to nature positive requires a company to collaborate and coordinate with government, industry, and other stakeholders to create powerful benchmarks.
- Know your supply chain: As much as understanding and evaluating your own nature risks and impacts, given the scale of dependencies throughout value chains, the sooner an organisation enhances its knowledge of their supply chain related nature risks, the better they position themselves as leaders in this space.
GHD Advisory’s guidance: Your next steps
- Use the resources developed through the TNFD pilot program to provide insights into how your organisation can address its nature-related impacts, dependencies, risks, and opportunities.
- Create a cross-company working group that explores the TNFD framework and its requirements.
- Engage with internal and external stakeholders to raise awareness of nature-positive impacts and opportunities.
- Determine what systems need to be in place for conducting thorough assessments.
- Begin your journey towards disclosure by identifying and assessing the nature-related issues for your organisation with the LEAP (Locate, Evaluate, Assess, Prepare) approach.
- Connect and partner with organisations to determine learnings, best practices, and guidelines for reporting.
- If possible, build off the work already done through climate-risk assessments and apply a similar approach to standardize metrics and methodologies.
Learn about how GHD can support your sustainability journey.
For more information on TNFD pilot programs: Piloting the Framework » TNFD