Nature inGreen FinanceBridging the gap in environmental reporting August 2023DISCLOSURE INSIGHT ACTIONExecutive summaryStandards such as the Task Force on Climate-related Financial Disclosures (TCFD) have paved the way for nature-related disclosures such as the Kunming-Montreal Global Biodiversity Framework (GBF) and the forthcoming Taskforce on Nature-related Financial Disclosures (TNFD). As nature-related disclosures are set to become a business norm, this report assesses the readiness of financial institutions to build on their climate reporting towards holistic climate and nature disclosures. The report analyzes the current state of environmental reporting by financial institutions with a focus on climate change, forests and water security. In 2022, 556 financial institutions disclosed environmental data through CDP’s climate change questionnaire, a 67% increase since 2020. In reviewing the data disclosed by these financial institutions in 2022, we categorized the findings in accordance with the four base pillars of the TCFD and TNFD: Governance, Risk and Opportunities, Strategy and Implementation, and Metrics and Targets. The findings underscore the urgent need for financial institutions to integrate nature-related risks and opportunities into financial decision-making. While climate change is now widely considered within financial institutions’ strategies, disclosure and action on forests, water, and broader nature-related issues lag significantly behind. However, several trends indicate a gradual shift in financial institutions moving beyond tackling climate change in isolation, to addressing nature in tandem. One-fifth of ecosystem services are at risk of collapse. Recognizing nature-related risks and opportunities has beco...
