Asset managers to begin reporting on nature-related risks
The 14 recommendations span four main areas: governance, strategy, risk and impact management, and metrics and targets.
The framework took two years to finalise, led by 40 members representing over $20trn in assets under management from 60 countries.
Asset managers and industry bodies make strides in promoting nature-positive investment
The TNFD's recommendations, which were published alongside guidance, will help market participants get started with integrating assessments and corporate reporting related to nature.
The aim of the recommendations is to «inform better decision making by companies and capital providers, and ultimately contribute to a shift in global financial flows toward nature-positive outcomes», the taskforce said.
The 14 recommendations span four main areas: governance, strategy, risk and impact management, and metrics and targets.
Under the framework, companies and asset managers will be asked to voluntarily disclose their organisation's governance of nature-related dependencies, impacts risks and opportunities; the effects these have on their business model, strategy and financial planning; in what way the business identifies, assesses and monitors nature-related risks; and what metrics and targets are used to manage such risks.
The TNFD explained its recommendations were built on the ones released by the Taskforce on Climate-related Financial Disclosures (TCFD), and are in line with the global standards of the International Sustainability Standards Board as well as the Global Reporting Initiative and the EU's SFDR.
At first, market adoption of the recommendations will be on a voluntary basis, which the taskforce will track every year via the publication of an annual report, beginning from 2024.
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