TNFD Explained: Nature-related Financial Disclosures for Finance Teams

For years, sustainability reporting in finance meant carbon. That is changing. Investors and regulators increasingly recognise that businesses depend on — and affect — nature itself: water, soil, ecosystems and biodiversity. The Taskforce on Nature-related Financial Disclosures (TNFD) is the framework built to capture that, and it is fast becoming the nature equivalent of the climate-focused TCFD.

What is the TNFD?

The TNFD is a global, market-led initiative that published its final recommendations in September 2023. Its purpose is to give organisations a consistent way to identify, assess, manage and disclose their nature-related dependencies, impacts, risks and opportunities. The aim is to shift global financial flows towards nature-positive outcomes by making nature risk visible in the same language as financial risk.

The four pillars and 14 disclosures

If you know the TCFD, the TNFD will feel familiar by design. Its recommendations are structured around the same four pillars — governance, strategy, risk and impact management, and metrics and targets — and set out 14 recommended disclosures across them. This deliberate alignment with the climate framework, and with the structure underpinning the ISSB standards, means organisations can integrate nature reporting into their existing sustainability processes rather than building something entirely separate.

The LEAP approach

To help organisations actually do the assessment, the TNFD provides the LEAP approach — a four-phase process: Locate your interface with nature (where in your operations and value chain you interact with sensitive ecosystems), Evaluate your dependencies and impacts on nature, Assess the material risks and opportunities that arise, and Prepare to respond and report. LEAP gives finance and sustainability teams a structured route from "we have no idea where our nature risk sits" to a defensible set of disclosures.

How TNFD relates to climate reporting

Nature and climate are deeply linked — deforestation drives emissions; climate change degrades ecosystems — so TNFD is designed to complement climate disclosure rather than compete with it. Organisations already reporting under the TCFD framework or transitioning to ISSB standards will find TNFD slots alongside their existing governance and risk structures, broadening the lens from carbon to the wider natural world.

Is TNFD mandatory?

TNFD is currently a voluntary framework, but adoption is accelerating: as of mid-2025, more than 600 organisations across over 50 countries had committed to reporting in line with its recommendations, including a significant share of the world's largest banks. As with TCFD before it, voluntary momentum often precedes regulatory expectation — so finance teams that build the capability now will be ahead when nature disclosure becomes the norm.

What finance professionals should do

Start by understanding where your organisation depends on and affects nature, familiarise yourself with the LEAP approach, and consider how nature fits your existing sustainability governance. Building fluency in frameworks like TNFD is exactly the kind of forward-looking skill our sustainability and ESG CPD courses are designed to develop.

Frequently asked questions

How is TNFD different from TCFD?

TCFD focuses on climate-related risk; TNFD applies the same four-pillar structure to nature and biodiversity more broadly. They are complementary frameworks intended to be used together.

What is the LEAP approach?

LEAP stands for Locate, Evaluate, Assess and Prepare — a four-phase method the TNFD provides to help organisations identify and assess their nature-related issues before reporting.

Do small companies need to follow TNFD?

TNFD is voluntary and currently driven mainly by larger organisations and financial institutions, but the underlying thinking — understanding nature dependencies and impacts — is increasingly relevant across supply chains of all sizes.

Nature is moving from the margins of sustainability reporting to its core. TNFD gives finance teams a credible, TCFD-aligned way to get ahead of that shift rather than scramble to catch up.