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    TNFD: A new framework for nature-related financial disclosures

    TNFD: A new framework for nature-related financial disclosures

    October 16, 2023 Responsible investment, Fixed income
    The final TNFD framework has been announced – we examine the implications for investors.
    • While it is becoming common for investors and asset owners to act on reducing climate change risk in their portfolios, natural-capital risk has received less scrutiny. The Task Force on Nature Related Financial Disclosures (TNFD) is a new market-led disclosure framework for measuring the impact of companies on nature, and their dependence on nature, building on the work of the Task Force on Climate-related Financial Disclosures (TCFD).

    • The TNFD is a voluntary framework, but we expect it to shape future regulations and investment practices. We also expect its adoption and influence to accelerate over the next two years.

    • Despite growing investor demand for biodiversity and nature-focused investments, the supply of credible use-of-proceeds bonds (also known as impact bonds) focused on these areas remains low.

    • We expect such issuance to grow as the TNFD framework is adopted. Some issuers are in the early stages of setting nature-related targets, which could lead to new issuance.
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