Although clear linkages exist, nature-related issues are frequently not considered financially material in corporate reports, especially from a single materiality perspective. Despite nature-related issues posing potential risks that could affect the financial prospects of a business, dependencies on nature remain poorly understood and underexplored. Businesses continue to struggle to implement risk assessment methods, particularly with assessing the financial implications of these risks.
This report demonstrates how nature-related risks may affect:
- a business's cash flow
- cost of capital
- access to capital over different time periods
- investor decisions and capital allocation.
The report also:
- Synthesises evidence on nature-related risks that could create material financial effects for corporates and financial institutions.
- Identifies evidence gaps.
- Presents insights from corporates and financial institutions on their risk assessment approaches and related challenges.
- Sets out recommendations for corporates, financial institutions, academia, regulators and standard setters.
About the Publishers
The Taskforce on Nature-related Financial Disclosures (TNFD) is a market-led, science-based and government-backed initiative that provides organisations with the tools to act on nature-related issues. The TNFD consists of members that represent financial institutions, corporates and market service providers. These members have developed recommendations, guidance and frameworks for the assessment and reporting of nature-related impacts.
The Environmental Change Institute (ECI) is a research unit that works with governments, businesses and communities to anticipate and respond to the risks of environmental change. The Resilient Planet Finance Lab is part of the ECI. It is a research and innovation programme looking at scaling the mobilisation of finance and action for resilience, nature and SDGs globally.
Global Canopy is a not-for-profit organisation. They provide data, metrics, and insights to companies, financial institutions, governments and organisations worldwide to help them make better decisions about nature, forests and people.
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