UN report: nature-related disclosure frameworks and standards not fully aligned

February 13, 2024|Written by

Regulators and industry bodies still need to align their nature-related disclosure frameworks and standards to provide clarity and streamline requirements for firms, a study from the UN Environment Programme Financial Initiative (UNEP FI) has found.

The report looks at seven leading standards and frameworks, including the European Sustainability Reporting Standards, the International Sustainability Standards Board, and the Taskforce on Nature-related Financial Disclosures framework.

While there has been work in aligning key concepts and methodologies, such as cross-referencing definitions, scoping and prioritisation guidance, the study found that improvements are needed, especially around assessment methodologies.

For example, in areas where there is a lot of scientific research, more work should be done “to promote consistency across frameworks and standards on the best practice”, while other areas should leverage science to develop more guidance.

The report found there were different definitions of materiality across frameworks, with some using a specific definition while others leave it up to companies. There was also differing guidance on how firms should identify nature-related issues that are material.

Meanwhile, most disclosures and assessment guidance deals with land and freshwater, with less consideration for the ocean. Nearly all approaches reviewed aim to be applicable to all sectors but vary in how tailored they are to specific sectors.

While most approaches reviewed require disclosures of nature-related issues in a company’s value chains, there is a variation in the level of detail expected for disclosures, as well as the scope of value chain links.

The report also found that nature-related impacts were core to nearly all assessments and guides, with most recognising that a comprehensive analysis requires looking beyond the impact drivers of doing business. Most also cover business dependency on nature, and they also use similar definitions of nature-related risks and opportunities.

The UNEP FI also found that all approaches encouraged companies to engage with stakeholders. Most also require or recommend that companies set nature-related targets, and disclose issues as well as metrics and progress.

This page was last updated February 13, 2024

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