Biodiversity Reporting

Nature-Related Financial Disclosures & Corporate Biodiversity Reporting

Why Biodiversity Reporting Is Critical

With £44 trillion of global GDP depending on nature and biodiversity loss accelerating, organizations face growing pressure to understand, disclose, and act on their nature-related risks and impacts — pressure that is steadily being written into mainstream sustainability reporting.

£44tn

Global GDP Dependent on Nature

100x

Current Species Extinction Rate

68%

Wildlife Population Decline Since 1970

$2.6tn

Nature Loss Cost by 2030

Taskforce on Nature-related Financial Disclosures (TNFD)

What is TNFD?

The Taskforce on Nature-related Financial Disclosures (TNFD) is a global initiative that published a nature-disclosure framework (the TNFD Recommendations), modelled on the TCFD approach to climate disclosure.

The TNFD’s technical work is completing during 2026, with new technical guidance paused; nature-related standard-setting is moving to the ISSB, which is developing a non-mandatory IFRS Practice Statement (an exposure draft is targeted for late 2026, not a new Standard).

Four pillars: Governance, Strategy, Risk Management, Metrics & Targets
Aligned with TCFD for integrated disclosure
Addresses both nature-related risks and opportunities

TNFD Pillars

Governance

Board oversight and management responsibilities for nature

Strategy

Nature-related risks and opportunities impact on strategy

Risk Management

Processes for identifying and managing nature-related risks

Metrics & Targets

Metrics and targets for assessing nature-related performance

TNFD LEAP Approach

TNFD's science-based approach to nature assessment: Locate, Evaluate, Assess, Prepare

Locate

Identify your organization's interface with nature across direct operations, upstream, and downstream

Evaluate

Determine dependencies and impacts on nature and nature's contribution to people at priority locations

Assess

Assess material nature-related risks and opportunities affecting your organization

Prepare

Prepare responses and develop strategy to mitigate risks, realize opportunities, and report

Types of Nature-Related Risks

Physical Risks

• Ecosystem degradation
• Species loss affecting operations
• Pollination service decline
• Water scarcity from habitat loss
• Extreme weather from ecosystem breakdown

Transition Risks

• New nature regulations
• Shift in consumer preferences
• Technology for nature restoration
• Increased costs of natural resources
• Investor requirements for nature disclosure

Systemic Risks

• Irreversible ecosystem collapse
• Tipping point cascades
• Supply chain disruption
• Social license withdrawal
• Economic system instability

Opportunities

• Nature-based solutions
• Regenerative business models
• Green finance access
• Brand differentiation
• New market development

Biodiversity Metrics & Indicators

State Metrics

• Species abundance and richness
• Ecosystem extent and condition
• Habitat connectivity
• Water quality parameters
• Soil health indicators

Impact Metrics

• Land use change (ha)
• Water consumption (m³)
• Pollution emissions
• Resource extraction volumes
• Waste generation

Dependency Metrics

• Ecosystem services reliance
• Natural resource inputs
• Water dependency ratios
• Pollination service value
• Climate regulation benefits

Biodiversity Reporting Implementation

Governance & Strategy

2-4 weeks

Establish board oversight, assign responsibilities, and integrate nature into corporate strategy and decision-making processes.

Appoint nature champion at board level

Conduct materiality assessment for nature

Integrate nature into risk management

Develop nature policy and commitments

LEAP Assessment

6-12 weeks

Complete the LEAP approach to identify priority locations, evaluate dependencies/impacts, and assess material risks.

Map operations and value chain

Prioritize locations with biodiversity importance

Assess ecosystem dependencies

Quantify nature-related impacts

Data & Metrics

8-16 weeks

Establish data collection systems, select appropriate metrics, and develop monitoring and reporting capabilities.

Choose relevant biodiversity metrics

Establish baseline measurements

Implement monitoring systems

Integrate with existing ESG reporting

Target Setting

4-6 weeks

Set science-based targets for nature, develop action plans, and establish performance tracking mechanisms.

Set no net loss / net positive targets

Develop restoration commitments

Create supplier engagement plans

Establish monitoring schedules

Disclosure & Reporting

4-8 weeks

Prepare TNFD-aligned disclosures, integrate with annual reporting, and engage with stakeholders on nature commitments.

Draft TNFD disclosures

Integrate with annual report

Prepare for external assurance

Engage stakeholders on progress

Biodiversity Reporting by Industry

Manufacturing & Mining

• Land use and habitat impacts
• Water and soil contamination risks
• Extractive impact on ecosystems
• Restoration and rehabilitation plans
• Supply chain biodiversity screening

Key Risks: Physical risks from ecosystem degradation, regulatory restrictions

Agriculture & Food

• Pollination service dependencies
• Soil health and fertility impacts
• Pesticide effects on biodiversity
• Regenerative agriculture practices
• Sustainable sourcing policies

Key Risks: Pollinator decline, soil degradation, supply disruption

Financial Services

• Portfolio biodiversity risk assessment
• Nature-related credit risk
• Financed emissions from land use
• Green and sustainable finance
• Client engagement on nature

Key Risks: Stranded assets, transition risks, systemic risks

Integration with Existing Reporting

Climate & Nature Integration

Biodiversity and climate are interconnected.

Nature-based solutions can deliver up to 37% of mitigation needed for Paris Agreement goals.

• Align TNFD with TCFD disclosures
• Include nature in Science Based Targets
• Report forest-related emissions in CDP
• Link to SECR environmental data

Regulatory Landscape

Nature reporting is becoming increasingly mandatory across jurisdictions, following the climate disclosure pathway.

On the EU side, the European Commission's forthcoming Circular Economy Act is a legislative proposal expected in Q3 2026.

In the UK, mandatory Biodiversity Net Gain has applied to all planning applications — major and minor — since 12 February 2024 (small sites had a temporary exemption that lapsed 2 April 2024).

• EU taxonomy includes biodiversity criteria
• UK considering mandatory nature reporting
• Biodiversity duty for public bodies
• Global Biodiversity Framework targets

UK Biodiversity Reporting Context

Current Requirements

Biodiversity Duty (Section 40 NERC Act)
Mandatory for public authorities; first consideration due by 31 December 2023, then at least every 5 years
Biodiversity Net Gain
10% net gain requirement for planning applications
Listed company climate disclosures
TCFD mandatory since 2022, nature integration emerging

Emerging Developments

Nature-related disclosure
No UK mandate or date has been announced; any future ISSB nature output would need separate UK endorsement
Financial sector nature risk
Bank of England exploring nature stress testing
Due diligence legislation
Potential supply chain nature due diligence requirements

Biodiversity Reporting FAQs

When will TNFD disclosure become mandatory in the UK?

Nobody is required to report nature-related risks under a UK mandate today, and no UK government consultation date or mandate date has been announced. Any future ISSB nature-related output (expected as a non-mandatory IFRS Practice Statement, not a Standard) would still need to go through the UK’s separate formal endorsement process before it applied here. Framework-driven voluntary reporting (TNFD, GRI, ESRS E4) remains the current route for UK companies wanting to disclose.

How does biodiversity reporting differ from climate reporting?

While climate focuses on GHG emissions and temperature change, biodiversity reporting covers impacts on ecosystems, species, and natural habitats. Nature is location-specific, harder to quantify, and involves complex interdependencies. TNFD builds on TCFD's structure but requires more localized, contextual assessment.

What data do we need for biodiversity reporting?

Start with location data (where you operate), land use impacts, water consumption, waste generation, and supply chain mapping. Then assess ecosystem dependencies (pollination, water filtration, etc.) and impacts on species and habitats. Many metrics can be estimated using existing environmental data initially.

Can we integrate biodiversity reporting with existing ESG frameworks?

Yes, TNFD aligns with TCFD structure and integrates with CDP, GRI, and SASB frameworks. Many organizations include TNFD disclosures in sustainability reports alongsideSECR and other environmental reporting.

What industries should prioritize biodiversity reporting?

Agriculture, forestry, mining, pharmaceuticals, tourism, and financial services face highest nature-related risks. However, all sectors have some nature dependencies through supply chains, water use, or ecosystem services. Start with materiality assessment to identify your specific nature-related risks and opportunities.