- “Nature-positive” task force believes businesses benefit from an approach that values nature and humans, too.
- Over half of the world’s economic output is highly dependent on nature, with the World Economic Forum estimating that $44 trillion of economic value generation is at least moderately tied to it.
- “The world’s natural capital is also in sharp decline, and without rapid and systemic change, biodiversity loss and landscape degradation will severely disrupt the world economy,” Global Canopy’s Chris Hart told Karma.
The dance between nature and commerce — the exploitation of resources — defines the human experience. From hunting and gathering, to trading among places near and far, to more modern activities like logging, ranching and drilling, people extracting things living and innate has brought better living at a high cost.
The Task Force for Nature-Rated Financial Disclosures (TNFD) wants to blunt that downside by creating “resilience in the global economy by redirecting flows of finance at scale toward nature-positive activities to allow nature and people to flourish.” The TNFD initiative aims to do for nature what the Task Force for Climate-Related Financial Disclosure (TCFD) did for climate — develop voluntary, consistent financial risk information for companies to give their investors, lenders, insurers and other stakeholders.
“Over half of the world’s economic output is currently highly dependent on nature, with the WEF [World Economic Forum] estimating that $44 trillion of economic value generation, more than 50% of global gross domestic product (GDP), is moderately or highly dependent on nature,” Chris Hart, sustainable finance associate at the nonprofit Global Canopy, told Karma in an email interview.
The idea for TNFD grew out of last year’s WEF meeting at Davos and has gathered strength from partners including Global Canopy, the United Nations Development Programme, the United Nations Environment Programme Finance Initiative and the World Wide Fund for Nature.
The immediate plan is to develop reporting frameworks to be available sometime in 2022. At that point, the finance sector will use the frameworks to steer monies toward outcomes that are “nature-positive,” in alignment with the Paris Climate Agreement, the CBD Post-2020 Global Biodiversity Targets and the UN Sustainable Development Goals, which addresses not only climate change and environmental degradation, but also poverty, inequality, and peace and justice.
Banks and other institutions sometimes unwittingly contribute indirectly to negative impacts on nature. For example, if it lends money to a meat-processing company whose product comes from cattle that grazed on land stripped of trees to make way for the animals, then the bank’s loan results in adverse consequences. “For the financial sector to be able to take natural capital into account, they need nature-related financial information from the businesses they invest in,” according to the Climate Disclosure Standards Board.
WEF’s Nature Risk Rising and Global Risks Report 2020 highlighted the growing scale of nature-base risk, added Hart. For the first time in the latter’s 10-year outlook history, the top five likely global risks are environmental — including results of extreme weather, failure to limit climate change, such human-made environmental crimes as oil spills and radioactive contamination, major biodiversity loss and ecosystem collapse, and natural disasters.
Such alarming results aren’t simply academic, noted Hart. “The world’s natural capital is also in sharp decline, and without rapid and systemic change, biodiversity loss and landscape degradation will severely disrupt the world economy,” he said.
