TNFD adoption rises by 30% in six months; additional guidance launched

Written by Jack Gray

28/06/2024

The number of organisations adopting the Taskforce on Nature-related Financial Disclosures’ (TNFD) reporting recommendations has increased by 30% since January, the initiative has revealed.

The additional 96 organisations brought the total number of companies committed to disclosing their material nature-related issues to investors and other stakeholders based on TNFD recommendations to 416.

These publicly listed companies that have signed up represent more than US$6trn in market capitalisation, an increase of 50% since the TNFD’s ‘early adopter’ announcement in January.

There are also now 114 financial institutions registered as adopters of TNFD, representing US$15.9trn in assets under management.

Among the new adopters include Legal & General Investment Management (LGIM), Investment Management and MUFG Asset Management, and a range of companies such as Volvo and Ricoh.

These organisations have signalled their intention to begin adopting the TNFD recommendations and publishing TNFD-aligned disclosures as part of their annual corporate reporting for the 2024 financial year, or earlier, or financial year 2025 outcomes.

TNFD disclosure reports based on 2023 financial year outcomes have begun appearing in the market less than a year after the release of the taskforce’s recommendations.

“The ongoing uptake of the TNFD’s recommendations is further evidence that the mindset in business and finance is quickly shifting to a recognition that accelerating nature loss is imposing costs and risks on society as a whole as well as to individual business models and capital portfolios,” commented TNFD co-chair, David Craig.

“Voluntary uptake now of the TNFD recommendations is the best way to meet these shifting expectations and the best way to meet new regulatory requirements such as CSRD.

“We are delighted that organisations globally are also using TNFD to prepare for the forthcoming expansion of the global sustainability reporting baseline now that the ISSB has commenced its important work on nature building on the recommendations of the taskforce.”

Amid the uptake in adopters, TNFD has launched its first set of Additional Sector Guidance, which covers eight real economy sectors, and Additional Guidance for Financial Institutions.

This sector guidance includes recommended sector-specific metrics for disclosure in line with the TNFD disclosure recommendations published in September 2023.

Meanwhile, the Additional Guidance for Financial Institutions includes guidance on the TNFD recommended disclosures and disclosure metrics for banks, re/insurance companies, asset managers and owners, and development finance institutions.

Additional guidance on the consideration of nature-related issues across value chains was also released.

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