Taskforce on nature related disclosures – what’s coming?

This article was co-authored by Sidratul Muntaha, Legal Apprentice, Manchester.

On 18 September 2023, the Taskforce on Nature-related Financial Disclosures (TNFD) published its final framework on nature related risk management and disclosure. The focus being reporting by businesses of their nature related financial risks and opportunities.

The framework is closely aligned to the Taskforce on Climate-related Financial Disclosures (TCFD) with the same four conceptual pillars of:

  1. Governance;
  2. Strategy;
  3. Risk and impact management; and
  4. Metrics and targets.

TNFD also adds a fifth consideration of risk and impact management.

The framework is consistent with the global sustainability standards of the International Sustainability Standards Board (IFRS S1 sets out general requirements for disclosures of sustainability related financial information and IFRS S2 sets out specific requirements in relation to climate related disclosures) and the European Sustainability Reporting Standards (focusing on a full range of ESG disclosure, including biodiversity).

The TNFD framework provides disclosure recommendations and guidance for businesses to report and act on evolving nature-related dependencies, impacts, risks and opportunities. The aim being that businesses will present clear and comparable disclosure with a view to businesses and their consumers, investors and other stakeholders having the information they need to address nature related risks. The TNFD framework also recommends that businesses include nature and biodiversity into their decision making process.

At present, TNFD is voluntary but we expect it to follow the same pattern as TCFD with regulatory adoption around the world and for nature related disclosures to become the norm.


The demand for nature related data is growing quickly. With the TNFD framework being published hot on the heels of the UK Government’s August 2023 announcement that it will establish UK Sustainability Disclosure Standards by July 2024, based on the IFRS sustainability disclosure standards, it is clear that corporate disclosures of sustainability related risks and opportunities are here to stay.

Nature and environmental risks include loss of biodiversity and degradation of ecosystems. They are distinct from climate related risks. The planned scope of disclosures, with the implementation of TFND, as well as TCFD, would therefore expand the scope of disclosures for businesses even further.

In terms of preparation, we encourage policyholders and their insurers to conduct corporate governance reviews. This includes the consideration of governance structures and arrangements within businesses, investment strategies, internal policies and engagement generally with stakeholders.

Insurers should consider building these types of questions into their placement process.

However, as with TCFD, there is a fine balance for businesses between being proactive and voluntarily adopting the framework whilst also ensuring that the disclosures made are accurate and not at risk of misrepresenting or ‘greenwashing’ a businesses’ practice. This has the potential to prematurely open up the company, its D&Os and its insurers to claims.

Related items:

Read other items in Professions and Financial Lines Brief - November 2023

Related content