Global Nature Plans: 6 Key Actions for Businesses in 2025
27th January 2025
Big changes are coming for businesses regarding how they impact nature. Nearly 200 countries have pledged to halt and reverse nature loss by 2030. This is being driven by international agreements and the increasing recognition of nature-related financial risks.
Why this matters
- The International Sustainability Standards Board (ISSB) may soon require companies to report on their impacts on nature.
- The UK’s finance minister has directed the Bank of England to consider how risks related to nature could affect the economy.
- This means companies should anticipate new, complex reporting requirements.
How we got here
- In 2017, the Taskforce for Climate-related Financial Disclosures (TCFD) established a system for reporting climate-related financial information.
- In 2022, the Transition Plan Taskforce (TPT) began setting standards for transition plans.[1]https://itpn.global/tpt-legacy/
- In 2023, the ISSB released its first two standards, IFRS S1 (general sustainability information) and IFRS S2 (climate-related information).[2]https://itpn.global/wp-content/uploads/2024/11/Final-Report-Progress-Achieved-and-the-Path-Ahead-TPT.pdf
Moving towards new standards
- In June 2024, the IFRS Foundation took over the TPT’s reporting materials. The rules in IFRS S2 are similar to the TCFD recommendations, meaning companies using ISSB standards will also be following TCFD.[3]https://itpn.global/wp-content/uploads/2024/11/Final-Report-Progress-Achieved-and-the-Path-Ahead-TPT.pdf[4]https://www.ifrs.org/news-and-events/news/2023/07/ifrs-foundation-publishes-comparison-of-ifrs-s2-with-the-tcfd-recommendations/
- Companies are transitioning from TCFD to ISSB and will start including sustainability-related financial information in their regular reports.
- By September 2024, 30 countries, representing a large portion of the global economy, stock market, and greenhouse gas emissions, were planning to use ISSB standards.[5]https://www.ifrs.org/content/dam/ifrs/supporting-implementation/issb-standards/progress-climate-related-disclosures-2024.pdf
Focusing on consistent reporting
- The goal is to ensure that ISSB standards work across different countries to create consistent reporting.
- In 2024, the ISSB agreed to research reporting on biodiversity and ecosystems.[6]https://www.ifrs.org/news-and-events/news/2024/04/issb-commence-research-projects-risks-opportunities-nature-human-capital/
Why nature matters
- While climate change plans are important, they don’t address all the reasons why nature is being lost.
- The Kunming-Montreal Global Biodiversity Framework (GBF) commits governments to stop and reverse biodiversity loss by 2030.[7]https://www.unep.org/resources/kunming-montreal-global-biodiversity-framework
- Goals 14 and 15 of the GBF require businesses to align their activities and report on their risks, impacts, and dependencies related to nature.[8]https://www.cbd.int/gbf/targets/14[9]https://www.cbd.int/gbf/targets/15 This will encourage sustainable production.
- The Network for Greening the Financial System (NGFS) has highlighted that nature-related risks could significantly impact the economy.[10]https://www.ngfs.net/en/press-release/ngfs-acknowledges-nature-related-risks-could-have-significant-macroeconomic-and-financial
Ignoring these risks could be detrimental to both individual companies and the overall financial system
New reporting requirements
- The ISSB may soon mandate companies to report on nature-related issues.
- The TNFD currently offers a voluntary framework for managing and reporting on these issues.
- There are suggestions that the UK government should make TNFD reporting mandatory and integrate it into the TPT framework.
- A recent UK Parliament Environmental Audit Committee Report has noted that the UK should not delay implementing mandatory TNFD reporting, despite international standards being important.[11]https://publications.parliament.uk/pa/cm5804/cmselect/cmenvaud/277/summary.html
Get ready for changes and seek opportunities
- Businesses should prepare for these upcoming changes.
- Companies that act early can benefit by reporting transition plans, identifying new market opportunities, and enhancing their reporting skills.
Six key actions for businesses
- Prepare for potential new mandatory rules on reporting nature-related impacts.
- Develop transition plans that address both climate change and now nature loss.
- Assess dependencies, impacts, and risks related to nature.
- Adopt the TNFD framework as a guide for reporting.
- Seek market opportunities by taking a leadership role.
- Monitor policy changes and government initiatives.
How HKA can help
HKA provides advisory and dispute services to help companies and governments prepare for and respond to environmental disputes. They have access to leading environmental experts. Additional information on HKA’s services can be found here: https://www.hka.com/industries/environment-climate-change/
You can also contact Dr Alex Lee directly: alexlee@hka.com
About the Author
Dr Alex Lee has over 25 years of experience in environmental consulting. He leads Environmental advisory and dispute services at HKA. He is a Chartered Geologist and Scientist and a Specialist in Land Condition (SiLC). He is a critical thinker and industry leader with a history of influencing and writing UK guidance. He has been cross-examined in litigation and regularly provides expert opinion, analysis, and advice within dispute values of up to £700 million.
References
↑1 | https://itpn.global/tpt-legacy/ |
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↑2 | https://itpn.global/wp-content/uploads/2024/11/Final-Report-Progress-Achieved-and-the-Path-Ahead-TPT.pdf |
↑3 | https://itpn.global/wp-content/uploads/2024/11/Final-Report-Progress-Achieved-and-the-Path-Ahead-TPT.pdf |
↑4 | https://www.ifrs.org/news-and-events/news/2023/07/ifrs-foundation-publishes-comparison-of-ifrs-s2-with-the-tcfd-recommendations/ |
↑5 | https://www.ifrs.org/content/dam/ifrs/supporting-implementation/issb-standards/progress-climate-related-disclosures-2024.pdf |
↑6 | https://www.ifrs.org/news-and-events/news/2024/04/issb-commence-research-projects-risks-opportunities-nature-human-capital/ |
↑7 | https://www.unep.org/resources/kunming-montreal-global-biodiversity-framework |
↑8 | https://www.cbd.int/gbf/targets/14 |
↑9 | https://www.cbd.int/gbf/targets/15 |
↑10 | https://www.ngfs.net/en/press-release/ngfs-acknowledges-nature-related-risks-could-have-significant-macroeconomic-and-financial |
↑11 | https://publications.parliament.uk/pa/cm5804/cmselect/cmenvaud/277/summary.html |
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