Taking TNFD to your Board
How are businesses building the case for TNFD?
The Green Finance Institute, which leads the TNFD UK consultation group, in collaboration with Chapter Zero, have created a downloadable template for Heads of Sustainability and Non-Executive Directors to upskill themselves and table a discussion on nature and TNFD with their Board. It demonstrates why the Task Force on Nature-related Financial Disclosures (TNFD) is relevant to all Boards, and how businesses can get started. It is for readers who have heard about TNFD but want to learn more about how it is relevant to their priorities. The deck is structured around three sections:
- Why are Boards acting on nature and TNFD?
- How are businesses getting organised?
- How can the TNFD framework help?
The TNFD website has extensive resources aimed at boards:
- TNFD in a Box contains five modules and a high-level overview aimed specifically at Boards
- Nature-related Risks and Duties of Company Directors
- Biodiversity as a material financial risk – What board directors need to know?
- Company Directors and Nature Risk (English Law)
- Boards and nature – evolving landscape for director’s duties
- Competent Boards Climate and Nature Designation Program
If you are a Head of Sustainability preparing for a Board discussion:
- Use Section 1 to identify which reasons to act on TNFD will resonate most with your Board and extract key relevant evidence.
- Use Section 2 to become familiar with how peers in the market are leveraging progress on climate, building the right skills across corporate functions and establishing governance structures for nature. Use as inspiration to develop an initial action plan on nature.
- Use Section 3 to understand how the TNFD recommendations and guidance can help your business on this journey and what adopting the TNFD framework means.
- Streamline and tailor the presentation for your use by selecting the most relevant slides and condensing information to the details critical to your business.
If you are a Non-Executive Director upskilling on nature:
- Use Section 1 to understand how nature and TNFD are relevant to your priorities as a Board member.
- Use Section 2 to understand how your business can equip itself to manage its nature risks and opportunities, access learning materials, and compare your current board structure with the example governance framework to understand the entry points for nature across your duties as a Board member.
- Use Section 3 to understand how the TNFD recommendations and guidance can help your business on this journey and what adopting the TNFD framework means.
- From the list of suggested questions for NEDs to ask management (in Section 2), select those most relevant to your business and extract supporting slides from the presentation where useful.
Why are Boards acting on nature and TNFD?
Climate
Nature is a critical tool to help companies meet their carbon sequestration, abatement and adaptation goals.
Natural ecosystems are expected to deliver a 1/3 of carbon sequestration required to meet 1.5 degrees.
Risk
Nature loss poses financial risks to businesses, such as supply chain disruptions, rising input prices, and regulatory costs. Directors’ duties are evolving to include oversight of nature risks.
More than ½ of global GDP is moderately to highly dependent on nature and $900bn in annual corporate turnover at risk because of deforestation-linked risks. UK GDP could take a 6% hit by 2030 due to chronic nature loss alone.
Opportunity
Shifting to nature-friendly practices can create new business opportunities, such as accessing new product markets, cutting production costs and enhancing brand value.
The nature transition could bring over $10 trillion in business opportunity and 395 million jobs globally by 2030.
Investors
Investors are increasingly pressuring companies to disclose details of their nature strategies and risk management frameworks.
More than 200 global institutional investors are working together to engage with investees on nature through PRI Spring and Nature Action 100 initiatives.
Regulation
Mandatory disclosure requirements on nature are incoming or expected in several jurisdictions, as well as compliance markets to minimise and offset nature impacts.
Four jurisdictions have announced mandatory disclosure requirements on nature including the EU and China. The UK is aligning with ISSB which is now working on a potential new nature standard.
Peers
Companies across all sectors are moving on TNFD creating competitive pressure to keep up with industry standards and avoid falling behind.
More than 400 adopters globally and over 60 UK organisations have committed to report on TNFD for FY2025.