Integrating Nature into Financial Institutions
Every economy is 100% dependent on the natural environment. Without nature, we would not have an economy built on the planetary systems we depend upon.
Nature loss alongside climate change is accelerating, creating fundamental challenges that cascade through financial returns.
The future cash flows of businesses depend on the flow of nature's inputs, making nature central to portfolio valuation and strategy.
TNFD's research with Oxford University provides 600+ examples demonstrating nature's financial materiality to business and finance.
Sovereign wealth funds, pension funds, and institutional investors increasingly ask companies specific questions about nature risk management.
Companies' exposure to nature as a driver of business performance directly impacts portfolio returns and investment decisions.
Asia demonstrates incredible leadership with strategic mindset and "enlightened self-interest" approach to nature integration.
Nature is becoming standard risk management and investment strategy practice alongside supply chains, cybersecurity, and AI.
TNFD is developing nature transition planning guidance with 14-15 institutions, releasing at COP 30.
| Tool | Provider | Purpose | Key Features | Cost |
|---|---|---|---|---|
| ENCORE | UNEP-WCMC | Natural capital risk assessment | 33 ecosystem services, Portfolio analysis | Free |
| WWF Biodiversity Risk Filter | WWF | Geographic biodiversity screening | Location-specific data, Risk mapping | Free |
| IBAT | Multiple partners | Integrated biodiversity assessment | IUCN Red List integration, Location mapping | Paid |
| ISS Biodiversity Tool | ISS | Portfolio impact quantification | Impact assessment, Performance measurement | Paid |
Approach: Used ENCORE tool and TNFD framework for deep dive analysis
Finding: 20% of loan book highly nature-dependent
Focus: Agriculture, metals & mining, built environment
Method: Portfolio → Value Chain → Expert Judgment → Risk Integration
Approach: Client-driven 2030 targets with comprehensive focus
Tools: ENCORE, ISS Tool, IBAT
Focus: Risks, opportunities, impacts, dependencies
Success: Strong mandates, cross-functional teams, decision translation
Scale: $750 billion assets under management
Approach: Supply chain resilience and sustainability
Focus: Transparency, traceability, resource diversification
Horizon: 10-20 year strategic planning perspective
Steps: Education → Assessment → Internal Engagement → Pilot Projects → Network
Steps: Comprehensive Assessment → Policy Development → Process Integration → Company Engagement → TNFD Reporting
Steps: Innovation → Leadership → Standard-Setting → Climate Integration → Impact Measurement
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