- United Kingdom
- June 8, 2021
- Reading time: 1 minutes
The Value of Nature: Business and Finance are accountable for plants and animals - finally
On 5 June 2021 finance ministers from the Group of Seven (G7) of the largest economies have endorsed the launch of the new Taskforce on Nature-related Financial Disclosures (TNFD). In view of the dramatic loss of biodiversity, this step is overdue. Nature as a whole is still an "externality" whose economic value is ignored in the economy. These new disclosure requirements require businesses and the financial community to financially quantify the costs resulting from the loss of nature.
“Biodiversity and nature loss is a global crisis. Governments have a pivotal role to play in supporting markets in tackling this emergency, so we’re pleased the G7 has thrown its weight behind the TNFD.” David Craig, Co-Chair, TNFD
What is it about
TNFD is a new global market-led initiative which aims to provide financial institutions and corporates with a complete picture of their environmental risks and opportunities. TNFD will deliver a framework for organisations to report and act on evolving nature-related risks, building on the success of the Task Force on Climate-related Financial Disclosures (TCFD).
Why is it important
Data gaps currently prevent financial institutions from assessing their nature-related risks, and so better information will accelerate the understanding of these issues and support a shift in global financial flows away from nature-negative outcomes and toward nature-positive outcomes.”
The TNFD will ensure that the framework developed is actionable and accessible for corporates and financial institutions, and builds upon cutting-edge research and innovation from all regions.
The Globalance View
In view of the dramatic loss of biodiversity, this step is overdue. Nature" as a whole is still an "externality" whose economic value is ignored in the economy. These new disclosure requirements now require businesses and the financial community to financially quantify the costs resulting from the loss of nature. This is an important step in making decisions sustainable.