UN-backed Taskforce eyes 2023 for nature-related risk disclosure framework
The Taskforce on Nature-related Financial Disclosures (TNFD) has selected senior executives from across thirty financial institutions to serve as members of the group, which is seeking will build a nature-related risks framework for businesses and financial firms, it announced last week.
The framework for TNFD – a UN-backed initiative that will look to replicate the success of Taskforce on Climate-related Financial Disclosures (TCFD) – is expected by 2023.
The TNFD was first announced in June as an extension of TCFD with the goal of developing “voluntary, consistent disclosures to help corporates, investors, lenders and insurance underwriters manage nature-related risks”.
It is co-chaired by UN assistant secretary general and executive secretary of the UN Convention on Biological Diversity, Elizabeth Mrema, and London Stock Exchange Group strategic adviser David Craig.
Members of the TNFD taskforce will convene for the first time this week to begin work on developing and delivering a risk management and financial disclosure framework to support what it terms “a shift in global financial flows away from nature-negative outcomes”.
“We are looking forward to immediately starting the work with our taskforce members,” Taskforce co-chairs Mrema and Craig said in a joint statement. “The business and financial world’s race towards net-zero emissions will only succeed if they race equally fast towards nature-positivity.”
“While the importance and urgency of our work is clear, so is the complexity of the challenge ahead for the TNFD. The TNFD initiative is by the market for the market,” the statement adds. “Therefore, development of a practical framework for nature-related risks will only be achievable by bringing together market practitioners and experts in biodiversity, data, metrics and standards, risk management and disclosure frameworks into a unique collaborative endeavor.”
The TNFD said its 30 taskforce members – which include senior figures from Bank of America, BlackRock, BNP Paribas, HSBC, and UBS, alongside numerous other well-known firms – had been selected for their sector and geographical coverage, as well as individual subject matter expertise across nature and finance.
Each taskforce member is expected to play a part in at least one of five initial working groups to create the TNFD framework, and selection of five further taskforce members is currently underway, TNFD said.
These five groups will focus on one of the following each: defining nature-related risks; data availability; landscape of standards and metrics; development of a beta framework; and pilot testing and integration, it explainde.
Although the finalised framework is not expected until late 2023, a draft beta version of the framework is expected to be circulated by the taskforce early next year.
More than 100 institutions have also signed up to provide support to the 30-strong taskforce through a broader consultative group, the TNFD Forum, and can be called upon to contribute to the direct work of the taskforce if needed, TNFD said.
A version of this article originally appeared at Professional Pensions.
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