Navigate Nature-Based Disclosure Frameworks
Environmental Defense Fund
Nature-based disclosures can be complicated, but it is important to report on your company’s nature impacts. With many new disclosure frameworks under development, companies must understand the current disclosure landscape and make informed nature-based disclosures following one or more recognized frameworks.
The main objective of nature-based disclosure frameworks is to promote transparency and accountability and encourage organizations to take actions that will preserve and restore nature.1 These frameworks are designed to be flexible and adaptable to different types of organizations, allowing you to report on your company’s nature-related risks and opportunities in a way that is relevant to your sector.
Nature-based disclosure can be complicated because of the breadth of scope covered. While specific frameworks will differ slightly, and each has robust guidance to support your disclosures, your company will need to consider a wide array of nature impacts as part of its disclosures. For example, how are your operations and supply chain affecting biodiversity, soil, and water quality? For each of these, you will need to understand the various indicators and associated metrics and determine the appropriate way to measure and report on your impact.
Navigate Nature-Based Disclosure Frameworks
Some of the most frequently referenced nature-based disclosure frameworks are included below. Reporting on your company’s nature impact can be complex, but these frameworks provide ample guidance on reporting requirements and metrics to help your company disclose on its nature-related impacts in a way that is relevant and meaningful to stakeholders.
- Taskforce on Nature Related Financial Disclosures (TNFD): currently under development, the TNFD will enable companies and financial institutions to assess, measure and disclose their nature-related risks and impacts, as well as opportunities and dependencies on nature. The TNFD framework covers both physical and transition risks, as well as nature-positive opportunities, across four pillars: governance, strategy, risk management and metrics and targets. The initial v1.0 framework is expected to be released in 2023; until then, a beta version of the framework is available for reference.
- Carbon Disclosure Project (CDP): CDP collects and publishes data on climate change, water security and forests from over 10,000 organizations across 100 countries. CDP also provides guidance, tools, and ratings to help organizations to improve their environmental performance and reduce their risks. CDP’s forest questionnaire helps companies disclose their exposure to deforestation risks along their supply chains, as well as actions they can take to address these risks.
- Global Reporting Initiative (GRI): GRI standards cover various topics related to nature, such as biodiversity, emissions, water and effluents, waste, and environmental compliance. GRI standards also encourage organizations to report on their material issues, stakeholder engagement and management approach.
Several additional organizations, such as the International Sustainability Standards Board, Science Based Targets Network, and GHG Protocol, include nature-based disclosures in their frameworks or are currently developing these standards. As nature-based disclosures become part of standard ESG reporting, your company will need to define an approach to understand, set goals and report on, and address nature impacts across your value chain.