While there have been many papers, reports, tools and frameworks that seek to help us understand this complicated and multi-faceted issue, it remains a difficult topic to report on and provide disclosures in a concise and insightful manner.
Biodiversity will continue to be integrated into Sustainable Finance via Linked and Use of Proceeds instruments, and we expect related disclosures and corporate commitments to increase.
The management of biodiversity issues are increasingly about becoming nature positive by making a positive contribution to nature. This is not just about basic risk management or throwing our hands up in the air because it’s all too hard.
We have used the all knowing Yoda to help pin point some of the main market reference points (listed below)…
Reference Point #1:
Biodiversity Standard Public Comment
This is an update to the 2016 GRI Biodiversity Guidance.
The Draft Standard will enable an organization to publicly disclose its most significant impacts on biodiversity and how it manages them.
This disclosure enhances transparency on the organization’s impacts.
Reference Point #2:
Taskforce on Nature-Related Financial Disclosures
This will become the “go to” reference once fully developed.
KPI/Indictors are still to be determined, however the rest of the guidance is great. This is the equivalent of the TCFD (Taskforce on Climate Related Financial Disclosures) for Nature and Biodiversity.
The TNFD is developing and delivering a risk management and disclosure framework for covering nature-related risks.
Reference Point #3:
Science Based Targets Network
Their guidance is excellent and this is a key reference.
Of particular note are the great guidance on indicators and also drivers of Biodiversity loss.
Reference Point #4:
Partnerships for Biodiversity Accounting Financials
The PBAF standard provides financial institutions with practical guidance on biodiversity impact and dependency assessments.
This is a sister organization for the PCAF (Partnership for Carbon Accounting Financials) and is an excellent reference.
Reference Point #5:
Natural Capital Coalition
Their Biodiversity Guidance has been developed as an approach to incorporate biodiversity into natural capital assessments.
With some great diagrams, frameworks and support for expanded thinking on Biodiversity it’s another fantastic reference guide to dive into.
Reference Point #6:
Application Guidance for Biodiversity-Related Disclosures
Now part of the ISSB (International Sustainability Standards Board) , this is still one of the best sources of knowledge in the market.
Lots of tools plus indexes explained and a great framework for conceptual thinking.
This one also helps answer the question “where do we start”.
Assists companies in the disclosure of the material information about the risks and opportunities that biodiversity presents to an organisation’s strategy and financial performance.
Biodiversity is a key sustainability topic that is multi-dimensional, complicated and interlinked to many factors.
Whilst we may not need to be as smart as Yoda to master this, a little bit of “the force” will certainly help.
The above guidelines should help us master this topic, and it is a “definitely a watch this space” topic. Biodiversity at the end of the day is the other side of the climate crisis.
There will be no Sustainable Finance on a lifeless earth.
Maybe just self-reflection with Yoda about what went wrong.