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full version of The Taskforce on Nature-related Financial Disclosures (TNFD) framework RELEASEd: An encouraging signal for nature-related reporting

Aurélie Gillon & Anne-Sophie Herbert-Génot
22 Sep 2023

Following several successive beta versions and a consultation with market participants, the TNFD’s finalized set of recommendations is now available and will allow companies in all sectors to study nature-related issues.

The TNFD (Taskforce on Nature-related Financial Disclosures) unites leading private sector players committed to assessing their environmental impact, integrating biodiversity and sustainability into business strategies. Capitalizing on our expertise in these fields, Capgemini is part of the TNFD forum and is providing an initial analysis of the first full version of the methodology.

To be fully consistent on sustainability topics, nature concerns need to be properly assessed and tracked by companies.

Our economies are inherently interconnected with nature, rather than separate from it. There is an urgent need to recognize the financial risk behind its collapse, as the loss of biodiversity is progressing at an unprecedented rate, much faster than the natural extinction rate: according to the WWF, 69% of wildlife populations have disappeared since 1970[1]. Governments have begun to acknowledge the criticality of this topic. Hence, more than 190 countries adopted the Kunming-Montreal Global Biodiversity Framework (GBF) in December 2022[2], committing to ambitious targets to protect and restore nature, and encouraging governments to introduce requirements for evaluation and disclosures of risks and impacts. Additionally, biodiversity loss is now recognized by the world’s central banks as a source of systemic risk just as important as climate change.

Unfortunately, unlike carbon issues for which awareness has risen, only a few companies are currently studying their dependence and their impact (supply chain, operations, corporate values, etc.) on nature. This oversight has been notably driven by the lack of an internationally recognized methodology or tool to measure and assess specific biodiversity-related issues.

The adoption of the TNFD aims to address this gap. Built as an addition to the climate focused TCFD, it significantly broadens its scope. Businesses and investors will now have a common comprehensive framework to transparently assess and communicate on both climate and biodiversity impacts, risks and opportunities, promoting the interconnectedness between the urgency of climate change and biodiversity concerns.



What is the TNFD?

The TNFD is a global, market-led, and science-based initiative, supported by governments. Its primary objective is to address the urgent need to incorporate nature considerations into financial and business decisions. It provides a risk management and disclosure framework that helps organizations identify, assess, and report on nature-related issues along their value chains, including financing activities. By promoting the integration of nature-related risks and opportunities into strategic planning, the TNFD aims to steer global financial flows towards nature-positive outcomes, fostering a more sustainable and resilient economy.

Starting in October 2021, the TNFD framework drafting has been progressively refined across multiple beta versions taking into account stakeholders’ feedback. September 2023 marked a pivotal milestone with the release of the first full version of the risk management and disclosure framework (v1.0). Among the significant modifications since the last beta version, the framework is unveiling a simplified and more focused “scoping” guidance, used to generate working hypotheses about organizations’ potential nature-related dependencies, impacts, risks, and opportunities.

The TNFD framework structure: What’s in it for corporates?

The methodology published is composed of the TNFD Recommendations, which are necessary to adopt to comply with the framework, as well as a suite of additional implementation guidance, which is not required, but is suggested to ease adoption.

The content can be split into three distinct categories:

  • Key concepts and definitions are introduced to summarize and make the science-based definitions accessible for businesses (shared language purpose). The framework brings together all the concepts of risks, impacts, dependencies, and opportunities behind the term “nature-related issues” and describes in depth the specificities of each notion.
  • The TNFD also provides guidance to assess nature-related risks and opportunities and incorporate them in corporates’ and financial institutions’ development strategies in the short, medium, and long term. These elements are not required to formally adopt the TNFD Recommendations but are suggested to help internal assessment in preparation of external disclosure.
  • To this end, the TNFD created the LEAP approach, a structured and ready-for-use methodology to internally assess impacts and dependencies regarding nature. In its final version published in September, the TNFD reinforced the LEAP approach with:
    • Filters for sectors, value chains and specific locations to make assessment manageable so that organizations can locate their interfaces with nature;
    • Alignment with the requirements of new ISSB and CSRD standards on materiality analysis and assessment in Europe;
    • Pilot testing insights from corporates and financial institutions, with a TNFD case studies catalogue made available.
  • The LEAP approach is a four-phase process that encourages organizations to be careful with the scope of their assessment and to involve the affected stakeholders:
    • Locate your interface with nature
    • Evaluate your nature-related dependencies and nature impacts
    • Assess your nature-related risks and opportunities
    • Prepare to respond and report

      This methodology is not a linear process but an approach with iterative components for analysis: it can and must have different starting points for sectors, companies and even business units regarding their links and dependencies with nature. The LEAP approach is not mandatory to adhere to the TNFD recommended disclosures: it has been drafted to help organizations to prepare their disclosures, and not everything identified, assessed, and evaluated should necessarily be disclosed. 

      Assessment requires metrics and indicators to compare and evaluate. Consequently, the TNFD dictates specific qualitative and quantitative metrics and indicators regarding business situation (location, sector, and biome) to properly assess both positive and negative impacts. Indicators are not only science-based but also practical to implement and maintain on annual reporting cycles and align with global policy goals. TNFD guidance also covers two steps prior to metrics choice and implementation: target setting, and scenario building to develop and test the resilience of the chosen strategies. Practical examples and case studies are provided to facilitate the understanding of each step of the process.
  • Finally, the core content of the TNFD are disclosure recommendations, the use of which is required to comply with the methodology.

    Since consistency of approach, structure, and language with the TCFD is key to early market adoption, the methodology took inspiration from its predecessor: 11 out of the 14 specific recommended disclosures come from the TCFD framework to which nature-related issues have been added, to start nature reporting alongside, or integrated with, climate. The three remaining recommendations were replaced by a new general requirements component introduced to the overall approach (location, scope, approach to materiality, stakeholder engagement, etc.), with additional guidance for certain sectors and biomes. All are organized along the same four pillars as the TCFD: governance, strategy, risk and impact management, and metrics and targets. The harmonization of metrics will allow corporates from all over the world to make external disclosure using the same, comparable format.

What are the next steps for the market?

Now that the framework has been published, the TNFD encourages voluntary adoption by corporates, assists other organizations in converting these recommendations into sustainability reporting standards and explore with governments and regulators its use for nature-related reporting by corporates. Starting with the TNFD, regulatory evolutions related to biodiversity and nature will be intensifying and financial institutions will be more informed in their investment decisions.

Thus, corporates need to anticipate this change and rethink their business models, based on a better understanding of their interaction with nature. While being conscious that exercise will be challenging in the beginning, it is a key and necessary step towards breaking silos in corporates’ sustainability strategies, which are currently more carbon oriented. Having access to a clear framework and guidelines, corporates must now leverage it and provide feedback that will benefit all TNFD users. We believe that such new considerations will unleash new opportunities and value creation, from local to global levels, as previous work on carbon and net zero topics has done in recent years.

Companies of all sectors finally have a comprehensive methodology to study biodiversity issues and understand where they currently stand. Beyond disclosure of the situation, companies should anticipate the next step and not wait for the final release of the SBTN’s set of targets for nature: it is time to start thinking about your pledges.

Aurélie Gillon, Director, Biodiversity Lead at Capgemini Invent

This post has been written by the Capgemini Invent France Sustainable Futures team:  Aurélie Gillon, Biodiversty Director; Anne-Sophie Herbert-Génot, Managing Consultant with the support of Alexandre Le Déméet, Senior Consultant; Adrien Cosson, Senior Consultant; Luna Simonet, Consultant; Mathis Larquetoux, Consultant


Anne-Sophie Herbert-Génot

Managing Consultant
With a background in agronomy engineering, specialized in environmental management, and a Ph.D. in Life Cycle Assessment, Anne-Sophie is dedicated to driving sustainability and energy transition for a large panel of industries in the Sustainable Futures division of Capgemini Invent.

Aurélie Gillon

Sustainability Director, Biodiversity Lead
With a dual educational background from ENS Ulm and HEC Paris, Aurélie is a Director in the Sustainable Futures practice of Capgemini Invent. As one of the Capgemini Group’s thought leaders on sustainability, she has developed the Group’s nature-positive offering, embodied its biodiversity voice, and represented Capgemini Invent at key sustainability events.