The Taskforce on Nature-related Financial Disclosures unveiled its inaugural ‘early adopters’ list at the World Economic Forum annual meeting this month.
Some 320 organisations from over 46 countries have committed to start making nature-related disclosures based on Taskforce on Nature-related Financial Disclosures (TNFD) recommendations as part of their corporate reporting for financial years 2023, 2024 or 2025, according to TNFD.
Notable names among these first adopters include Norges Bank Investment Management, Bank of America, Axa, Holcim, IKEA, Kering, Sony, and Veolia. UK-headquartered organisations, such as the London Stock Exchange, Fidelity International, Federated Hermes, Schroders, PwC, Heathrow Airport Holdings Ltd, AstraZeneca, Reckitt, GSK, Anglo American, OVO and the BBC are also on the list.
David Craig, Co-Chair of the TNFD, called it a milestone moment for nature finance and corporate reporting. Climate-related sustainability reporting is going mainstream through the new International Sustainability Standards Board (ISSB) standards and regulation in a growing number of countries. Investors, lenders, insurers and companies recognise that business models and portfolios are highly dependent on both nature and climate, he says.
“We are delighted to see such a strong, diverse and international group of companies and financial institutions step forward only four months after the release of our recommendations and look forward to even more stepping forward over the coming months.”
Some early adopters also commented on why they were embracing TNFD recommendations. Heathrow Airport, for example, is managing approximately 10% of its landholdings for biodiversity projects. “We’re proud to be an inaugural adopter of TNFD and believe adopting the recommendations will equip Heathrow with the framework and information necessary to effectively and transparently measure and improve our impact on nature,” says Javier Echave, Heathrow’s Chief Financial Officer.
According to WEF’s Global Risks Report 2024, climate and environmental risks were identified by global executives as the most significant risks for the next decade. They are also the risks for which leaders are the least prepared. Most companies, investors and lenders today do not understand their nature-related dependencies, impacts, risks and opportunities and are inadequately accounting for nature in their strategies and capital allocation decisions.
“Halting and reversing biodiversity and nature loss remains one of the most urgent challenges for society and the financial sector,” says Oliver Withers, Head of Nature, Standard Chartered, another early TNFD adopter. “Embedding the TNFD across our business provides a valuable risk management and disclosure framework to act on evolving nature-related dependencies, impacts, risks and opportunities in a consistent and transparent manner.”
As international efforts galvanise around the global goal to reverse nature loss by 2030, there is increasing impetus for businesses to assess, disclose and act on their nature-related risks and opportunities. Besides improving risk management, mobilising business innovation and finance to reverse nature loss will also be a major source of new market opportunities and competitive advantage.
“Nature loss is one of the biggest challenges facing humanity, deeply connected with the climate crisis and growing social inequality around the world,” Jesper Brodin, CEO of Ingka Group, IKEA, and Jon Abrahamsson Ring, CEO of Inter IKEA Group, explain. “We see nature-related issues as a strategic business issue and believe the TNFD recommendations and guidance will support us in further assessing risks and opportunities and allowing more targeted positive action. We also know that our future relevance, success and resilience of our business is directly linked to how we address this now.”
ICAEW has stressed that the accounting profession has a vital role to play in this transformation. Accounting and finance professionals, in their roles as company leaders and advisers, have the expertise in organisational governance, strategy, risk management and performance to help integrate nature into business and financial decision-making. The profession is therefore integral to the TNFD’s mission, with chartered accountants playing an instrumental role in enabling the businesses they lead and advise to adopt and implement the TNFD’s recommendations.
The TNFD is inviting other organisations that wish to become TNFD adopters to sign up online here.
For further insights, see our previous articles covering the launch of the TNFD recommendations and on how getting started on the journey towards reporting on nature issues may be easier than you think. For any queries, please get in touch with Toby Roxburgh, Nature and Biodiversity Manager, ICAEW at toby.roxburgh@icaew.com
