The Taskforce on Nature-related Financial Disclosures (TNFD) plans to launch consultation groups in six markets – including Japan, India and the UK – as part of a drive to improve feedback and engagement at the global, national and community level.
Launched in June 2021, the TNFD has until 2023 to develop a framework for companies and financial institutions to assess, manage and report on their dependencies and impacts on biodiversity.
The multi-stakeholder groups – which were announced at the World Economic Forum in Davos – will be tasked with discussing nature-related business and finance issues, as well as the future adoption of the TNFD’s global framework.
Convenors of the national consultation groups will include Rabobank, the Dutch Banking Association, the Green Finance Institute (GFI), the Responsible Investment Association Australasia (RIAA) and UBS.
Tony Goldner, executive director of TNFD’s secretariat, told Responsible Investor that the groups will help build awareness of the initiative’s work, expand the number of institutions contributing feedback on a beta version of the framework, and in the longer term, will play a valuable role in scaling market adoption of it.
The selected markets – which also include Australia, New Zealand, the Netherlands and Switzerland – were chosen since they had seen “significant interest” in the Taskforce’s work, Goldner said.
UBS’s role as the convenor of the Swiss group is understood to be on an interim basis. A permanent convenor for the jurisdiction will likely be established in the next couple of months.
Additional consultation groups are expected to be announced throughout 2022 and 2023 “based on demand and interest from market participants”, Goldner said.
“Consultation groups are a response to strong market interest in a number of jurisdictions to be engaging each other and shared learning on the challenges and opportunities of nature risk and opportunity management.”
Helen Avery, director of Nature Programmes and GFI Hive, who is the UK consultation group convenor, told Responsible Investor: “We know from our own experience that constructive engagement with business, finance, local communicates and wider stakeholders is critical to securing the future uptake of new frameworks. Therefore, running an inclusive consultation is fundamental to the TNFD’s success and will help to deliver a practical framework.”
She continued: “The UK, as with other regions, has already seen considerable interest in the TNFD from the business, finance, public sector and civil society organisations, and the consultation groups offer an opportunity to deepen that engagement.”
In August, Responsible Investor exclusively reported that plans were underway for a national chapter in Australia.
“RIAA’s convening of investors through our Nature Working Group and now through the TNFD are critical elements in building investor capacity and ultimately, protecting our natural capital,” said Simon O’Connor, CEO at RIAA. “This is of utmost importance to our investor members, and the Australian and New Zealand economies.”
The TNFD also used the Davos forum as an opportunity to announce piloting partners for the beta version of its framework, which was published in March.
Global Canopy, UNEP-FI, the World Business Council for Sustainable Development and FSD Africa, through the African Natural Capital Alliance, have been confirmed as the first four partners under the programme. For the next 12 months, they will each run a portfolio of pilot tests with companies and financial institutions.
According to Global Canopy’s website, it has already begun the first pilot with a group of financial institutions and corporations operating in the palm oil sector and more will follow over the coming year.
“We see deforestation and forests as an important entry point for organisations looking to tackle their impacts and dependencies on nature,” said Niki Mardas, executive director of Global Canopy. “This is why we’re undertaking our first TNFD pilot in the palm oil sector.”
Finally, TNFD this week committed to partner with the International Union for Conservation of Nature to engage with indigenous peoples and local communities to ensure their voices and perspectives are incorporated into the design and development phase of the framework.
Eve Gleeson, research manager at ShareAction, flagged this as the most important of the three initiatives announced by the TNFD this week.
“The TNFD has taken the commendable step to involve indigenous peoples and local communities in the design of the framework,” she said. “These communities often experience the greatest impacts of biodiversity and nature loss, which is being driven by the world’s biggest companies, and it is right to value indigenous leadership in environmental stewardship and recognise the potential of community-based solutions.”
Find out more about this topic from industry leaders at the RI Europe 2022 conference, taking place in person in London on 14-15 June.