The Taskforce on Nature-related Financial Disclosures (TNFD) is a market-led, science-based global initiative that aims to develop a risk management and disclosure framework for organizations to report and act on evolving nature-related risks and opportunities. The TNFD framework is designed to enable businesses and financial institutions to assess, disclose, and manage nature-related risks, dependencies, impacts, and opportunities. It builds upon the success of the Task Force on Climate-related Financial Disclosures (TCFD) and aims to broaden the scope of environmental risk management to include aspects of natural capital such as biodiversity and ecosystem services.
The TNFD's work is guided by seven principles to ensure the framework's effectiveness:
(1) market usability, (2) science-based approach, (3) focus on nature-related risks, (4) purpose-driven orientation, (5) integrated and adaptive design, (6) consideration of the climate-nature nexus, and (7) global inclusivity.
More than half of the global economy, approximately $44 trillion in economic value, is moderately or highly dependent on nature. The TNFD released its final recommendations in September 2023, marking a significant milestone in encouraging and supporting action on nature. These recommendations are designed to be consistent with and complement existing sustainability reporting frameworks, including the International Sustainability Standards Board (ISSB) Standards.
Financial institutions and businesses interested in adopting the TNFD framework can consult the Sector Guidance for Financial Institutions and the Getting Started Guidance co-authored by UNEP FI. The TNFD also encourages organisations to join the TNFD Forum and explore additional guidance and capacity-building materials available in the Knowledge Hub.
Since the release of the final recommendations, market adoption has accelerated at a remarkable pace. As of late 2025, over 730 organisations across 56 countries have publicly committed to making TNFD-aligned disclosures, including asset managers overseeing more than $22 trillion in assets under management. This rate of voluntary adoption has outpaced early comparable uptake of the TCFD's climate-related recommendations, suggesting that the business and finance community is increasingly recognising nature loss as a material strategic concern alongside climate change.
The LEAP Approach
The TNFD has developed an integrated approach called LEAP (Locate, Evaluate, Assess, Prepare) to help organizations identify and assess nature-related issues. This approach is designed as a voluntary internal process to assist entities in understanding and managing their interactions with nature.
The four main components of the LEAP approach are:
Locate: Organizations identify their interface with nature by considering their business footprint, the biomes and ecosystems they interact with, impacted locations, and affected sectors or business units.
Evaluate: This step involves identifying environmental assets and ecosystem services, determining dependencies and impacts, and conducting a dependency and impact analysis.
Assess: Organizations evaluate nature-related risks and opportunities, considering existing mitigation controls and opportunity management processes. They determine areas requiring further work and identify material elements for inclusion in TNFD disclosures.
Prepare: This final step focuses on responding to identified risks and opportunities and reporting on them. It includes strategy and resource allocation, as well as disclosure actions such as determining what to include and how to present findings.
The LEAP approach is intended to be iterative and can be applied by both corporates and financial institutions. It helps users evaluate the scope of their assessment, understand location-specific nature-related risks, consider how these risks may change over time, and conduct scenario analyses. While not mandatory, the LEAP approach serves as a practical tool to guide organisations in evaluating their nature-based risks and opportunities, ultimately informing their strategy and disclosures aligned with TNFD recommendations.
What distinguishes the LEAP approach from many other sustainability assessment methodologies is its explicit emphasis on location specificity. Unlike climate risk, which can often be assessed at an aggregate organisational level, nature-related risks are inherently place-based. A company's dependency on water availability, pollination services, or soil quality will vary dramatically depending on the specific geographic context in which it operates. The "Locate" step therefore requires organisations to map their direct operations and upstream value chains against sensitive biomes, protected areas, and areas of high biodiversity importance. This spatial dimension adds complexity to the assessment process, but it also yields far more granular and actionable insights than a purely sector-level analysis would provide.
TNFD framework
The nature-focused disclosure framework (TNFD) is structured around four main pillars, mirroring the architecture of the climate-related disclosure recommendations established by the TCFD;
Impact of companies on the biodiversity
The impact of companies on biodiversity can vary significantly across industries. While some sectors have obvious connections to nature, many organizations may not fully comprehend their dependencies on or impacts to biodiversity. Industries dealing with commodities like soy, beef, palm oil, leather, chocolate, coffee, rubber, and wood often have material impacts on nature and are increasingly subject to regulations such as the EU Deforestation Regulation.
Less apparent impacts can arise from activities like land clearing for construction or pollutant release into waterways. Importantly, these effects may occur indirectly through the value chain rather than in direct operations.
The TNFD framework closely aligns with the climate-focused TCFD, which has gained significant traction since its 2017 recommendations. Additionally, initiatives like Nature Action 100, inspired by Climate Action 100, demonstrate growing investor interest in managing nature and biodiversity risks in their portfolios.
Beyond commodity-linked sectors, the financial services industry itself faces substantial nature-related exposure. Banks, insurers, and asset managers with portfolios concentrated in nature-dependent sectors carry latent risks that may materialise as physical risks (e.g., crop failure from pollinator decline), transition risks (e.g., new regulations restricting land conversion), or systemic risks (e.g., cascading ecosystem collapse affecting multiple sectors simultaneously). The Network for Greening the Financial System (NGFS), a coalition of central banks and financial supervisors, has acknowledged that biodiversity loss constitutes a systemic risk to financial stability, reinforcing the rationale for integrating nature-related considerations into prudential supervision and financial decision-making.
With the global economy heavily reliant on nature, integrating nature-related risks and opportunities into strategic planning is essential. The TNFD framework, though currently voluntary, has seen substantial and growing adoption momentum globally. Governments and regulators are increasingly recognising biodiversity risk, as evidenced by the commitments made under the Kunming-Montreal Global Biodiversity Framework adopted in December 2022. The Framework's Target 15 specifically calls on governments to introduce requirements by 2030 for large and transnational companies and financial institutions to assess and disclose their nature-related dependencies, impacts, risks, and opportunities through their operations, supply chains, and portfolios.
Looking ahead, the convergence between nature-related and climate-related disclosure is accelerating. The ISSB has announced its intention to build upon the TNFD's work as it develops future standards addressing nature and biodiversity. This signals a clear trajectory: what is voluntary today is increasingly likely to become embedded in mandatory reporting requirements across multiple jurisdictions in the years ahead. Organisations that begin their nature-related assessment and disclosure journey now, even on a voluntary basis, will be significantly better positioned when these regulatory expectations crystallise.
Conclusion
The TNFD represents a watershed moment in how the business and finance community engages with nature. For the first time, organisations have access to a globally consistent, science-based framework for identifying, assessing, and disclosing their nature-related dependencies, impacts, risks, and opportunities. The pace of voluntary adoption, the alignment with international biodiversity commitments under the Global Biodiversity Framework, and the growing engagement of financial regulators all point in the same direction: nature is no longer a peripheral concern for corporate sustainability teams. It is a strategic management issue with direct implications for financial performance, regulatory compliance, and long-term enterprise resilience.
For organisations yet to begin their TNFD journey, the message is straightforward: start with the data and capabilities you have, apply the LEAP approach to identify your most material nature-related issues, and expand the scope and depth of your disclosures over time. Early engagement not only builds internal capability but also positions the organisation favourably with investors, regulators, and other stakeholders who are increasingly scrutinising how businesses manage their relationship with the natural world.
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