Biodiversity reporting and investment gather pace with TNFD update and plans for new asset class

CDSB has also kicked off a consultation on biodiversity-related disclosures

The Taskforce on Nature-related Financial Disclosures (TNFD) has announced its Secretariat will be hosted by the UK Green Finance Institute (GFI) and headed up by former World Bank adviser Tony Goldner.

Goldner has been appointed Executive Director of the Secretariat, which in addition to the GFI will also be supported by the UN’s Development and Environment Programmes. 

Goldner was a Senior Advisor on global governance at the World Bank and is CEO of Lyceum Advisory Partners, which describes itself as helping corporate and public leaders with “the design of nation-building programs and the incubation of social impact investment initiatives”. 

Mirroring the model of the Taskforce on Climate-related Financial Disclosures, the TNFD was first announced in July last year and is tasked with developing a framework for companies and financial institutions to assess, manage and report on their dependencies and impacts on nature. The Taskforce is aiming to publish a market-led disclosure framework by 2023.  

Its Secretariat will report to the TNFD co-chairs David Craig, former CEO and founder of Refinitiv, and Elizabeth Maruma Mrema, United Nations Assistant Secretary General and Executive Secretary of the UN Convention on Biological Diversity (CBD) Secretariat, whose roles were announced at the official launch of the TNFD in June

The Secretariat will be hosted virtually by the GFI, which is a partnership between the City of London and the UK Government, but will consist of staff across the globe. According to the Executive Director job ad it will be a team of around seven full-time staff.  

The individual members of the TNFD and the “composition of the broader consultative network of supporting networks” will be announced later this month, according to the statement.  

The Taskforce is expected to consist of around 30 members from financial institutions, corporates as well as data and service providers. It will also be informed by a Stakeholder Group of governments, regulators, multilaterals, financial and business consortia, NGOs, think-tanks and research organisations.

The Taskforce also announced that French development bank AFD will convene and lead the TNFD’s Development Finance Hub, which will focus on coordinating the contribution of public development finance institutions to the TNFD.  

In other biodiversity reporting-related news, the Climate Disclosure Standards Board (CDSB) – which is a member of one of the TNFD working groups – has launched a consultation on its proposed guidance for biodiversity-related disclosures.  

The aim of the CDSB Biodiversity Guidance is to support organisations in making disclosures and enable users of mainstream annual financial reports to assess material biodiversity-related financial information. It will serve as a supplementary guidance document to the CDSB Framework for reporting environmental and climate change information. 

The CDSB plans to publish the final guidance at the end of the year, a spokesperson told RI. The deadline for submitting comments on the guideline document is 4 October. 

Meanwhile, the New York Stock Exchange (NYSE) has announced it is developing a new class of publicly-traded assets called Natural Asset Companies (NACs), in partnership with natural capital specialist Intrinsic Exchange Group (IEG). NACs will be defined as sustainable enterprises that hold the rights to ecosystem services produced by land, such as carbon sequestration, biodiversity and clean water. 

“Because the value created by NACs is not fully captured by traditional economic metrics, IEG has developed an accounting framework to measure ecological performance to complement GAAP financial statements,” said IEG, which received initial funding for the project from the Inter-American Development Bank, The Rockefeller Foundation, Aberdare Ventures and Entertaining Ideas. The framework was developed in consultation with Robert Herz, former chair of the Financial Accounting Standards Board. 

NYSE will seek approval from the US Securities and Exchange Commission to introduce special listing requirements for the new asset class, based in part on IEG’s accounting methodology. After those rules have been developed, IEG and NYSE will support the first NACs in preparing to list on the exchange.