The dawn of TNFD: A game-changer for biodiversity?

Weeks before COP28, the much-anticipated final recommendations of the Taskforce for Nature-related Disclosures (TNFD) are set to be unveiled. The landmark release, coming later this month, will conclude an extensive 18-month consultation that spanned four draft versions, with invaluable insights from a robust forum of over 1,100 institutions and stakeholders. With such comprehensive groundwork laid, expectations are high for what this revelation might mean for the biodiversity landscape.

TNFD and its roots in TCFD’s legacy

In crafting its approach, the TNFD has taken a page from the proven strategies of its predecessor, the Task Force on Climate-related Financial Disclosures (TCFD). The TCFD’s success in providing investors with a robust framework to assess and report climate-related risks and opportunities has been widely recognised. Similarly, TNFD aims to provide investors with an exhaustive framework to evaluate and disclose potential risks and opportunities related to nature and biodiversity.

The Biodiversity Conference of Parties (COP15) in December 2022 emerged as a pivotal moment that amplified the urgency of biodiversity conservation on the global stage. By driving the biodiversity conversation to the fore of the global regulatory agenda, COP15 underlined the intertwining of economic systems with the delicate balance of our planet’s ecosystems.

What this means for asset managers and stewardship professionals 

Biodiversity, often considered a secondary concern in the past, has emerged as a prime consideration for investors, especially for asset managers and stewardship professionals. This rising interest stems from:

  1. Net-zero goals: The quest to achieve net-zero decarbonisation goals remains inextricably linked to addressing the global biodiversity challenge. 
  2. Business impact of biodiversity loss: More than ever, investors are becoming more aware that the degradation of ecosystems and the resultant loss of biodiversity are not mere environmental issues; environmental degradation has a profound economic impact. Disrupted supply chains, heightened business risks, and even reputational damage are just some potential pitfalls organisations might face, emphasising the need for active engagement in biodiversity conservation.

Managing risk in an evolving arena with SI Engage

Nature’s complexity and its intricate interplay with human-driven systems necessitate a continuous evolution in our risk assessment methods. SI Engage system is instrumental in this realm. By fostering active engagement and facilitating insightful exchanges, the system plays a pivotal role in helping asset managers and stewardship professionals navigate the labyrinth of nature-related risks. As we tread new grounds with TNFD’s forthcoming recommendations, leveraging platforms like SI Engage remains crucial to mitigating unforeseen challenges.

The imminent launch of TNFD‘s final recommendations promises more than just guidelines. It carries with it the potential to revolutionise how we perceive and act upon biodiversity-related challenges. Only time will tell if it lives up to high expectations. However, one thing remains clear – the conversation around biodiversity has shifted from the periphery to the centre, and it’s here to stay.

SI Engage turns complex data into meaningful insight and positive change. Book your demo now.

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