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Additional guidance by sector and biome

Additional guidance by sector and biome

The v0.4 beta release includes an initial set of additional guidance by sector and biome, as described in Table 4.

Additional Content

This first set of draft sector and biome guidance has been developed through consultation with market participants in each sector and experts on each biome, including a number of organisational members of the TNFD Forum and TNFD knowledge partners.

The Taskforce welcomes further feedback on this draft additional guidance and will continue active consultation to improve and expand other sectors and biomes. This is already underway through the Taskforce for:

  • Aquaculture;
  • Chemicals and pharmaceuticals;
  • Forestry;
  • Infrastructure and real estate; and
  • Textiles and apparel.

Users can access the additional sector and biome guidance on the TNFD’s framework site using a new sector and biome dashboard filtering function. Users can now set sector and biome preferences to create a unique user dashboard that ensures each user sees cross-sector LEAP guidance, and any additional guidance for those sectors and biomes that are relevant to them.

Figure 10: The TNFD additional guidance dashboard functionality

The tailored dashboard format for this additional guidance is presented as a first prototype for testing by market participants, ahead of the final framework in v1.0. The Taskforce welcomes feedback from users on the utility of the additional guidance dashboard functionality, and suggestions for what is needed to ensure the guidance is practical, easily navigable and includes relevant, decision-useful information.

Towards sector guidance: TNFD sector classification & sector prioritisation

The TNFD draft disclosure recommendations are sector agnostic and apply both to financial institutions and corporates.

Since the launch of the Taskforce, the TNFD has received significant interest from market participants in the development of additional guidance, including by sector. The TNFD therefore aims to enhance the specificity of its recommendations moving forward and develop additional guidance that is relevant, customised and aligned to the needs of different market participants.

TNFD’s Proposed Approach to Sector Classification

The TNFD’s non-financial sector classification is based on the Sustainable Industry Classification System® (SICS®), developed by SASB to group companies based on shared sustainability risks and opportunities. This has been adopted by the ISSB for the global baseline they are developing for sustainability disclosure. The TNFD has adopted SICS® to align as closely as possible to this emerging global baseline under development by the ISSB.

The TNFD will organise financial sector guidance into the four major financial services industries identified and defined by the TCFD: banks, insurance companies, asset managers and asset owners. Development Finance Institutions have been added, given their important role in nature-related financing in emerging markets, including in many nature hotspots.

The specific guidance developed by the TNFD will be designed to be interoperable with different sector and industry classification schemes and a mapping to different classification schemes will be provided in future releases.

TNFD’s proposed priority sectors

Non-financial TNFD priority sectors

While the TNFD recognises that every non-financial sector has an impact on nature and is affected by nature-related risks and opportunities, the TNFD has developed an initial list of its priority sectors, identifying the sectors and industries that are more likely to be financially impacted than others due to their exposure to dependencies and impacts on nature. It also considers the sector’s potential opportunities – activities that create positive outcomes for organisations and nature by avoiding or reducing negative impact on nature or contributing to its restoration. This first list of priorities has been identified to ensure a manageable scope of work for the Taskforce in developing its first set of specific guidance. Further sectors, sub-sectors and industries may be added in subsequent releases.

To inform its prioritisation of sectors for developing sector specific guidance, the TNFD has conducted a review and consolidation of existing sector-specific research and assessments focused on nature-related dependencies, impacts, risks, and opportunities.[1] Based on this review and evaluation, and aligned with the SICS classification scheme, eight thematic sectors, 13 sub-sectors and 19 industries have been prioritised for the TNFD’s initial development of sector-specific guidance/recommendations moving forward:

Additional Content

Financial industries prioritised by TNFD

The TNFD will organise financial sector guidance into the four major financial services industries identified and defined by the TCFD, with the addition of Development Finance Institutions, given their important role in nature-related financing in emerging markets, including in many nature hotspots.

Additional Content

The TNFD’s sector equivalency tool will allow these industries to be mapped to equivalent national/regional classification systems (e.g. NACE, Taxonomies) or other commonly used classification systems (e.g., GICS as used in ENCORE, ICS).