Summary of feedback on v0.3 of the TNFD beta framework

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Summary of feedback on v0.3 of the TNFD beta framework

The TNFD is adopting an open innovation approach that encourages market participants to co-create the TNFD framework by reviewing, pilot testing and providing feedback on all aspects of the beta framework.

For v1, the Taskforce will continue to refine the framework and incorporate further feedback on all framework components from market participants received by 1 June 2023. It will also develop a set of complementary recommendations for policy makers on the enabling environment for application of the TNFD framework, including needs and gaps on data and capability building.

Overview of feedback on v0.3

Since the release of v0.1 of the TNFD beta framework in March 2022, v0.2 in June 2022 and v0.3 in February 2023, the Taskforce has received significant feedback from a range of market participants n advance of this v0.4 release. A summary of this feedback and the Taskforce’s initial response to that feedback are provided here. There was overall positive feedback on all components of the framework and general appreciation for the material released in v0.3.

Further feedback on versions of the TNFD beta framework is welcome throughout the open innovation process until 1 June 2023.

The TNFD is concluding its open innovation process with a 60-day formal consultation where organisations can submit responses to this final beta version of the framework (v0.4). All feedback received will inform the complete framework, which will be published in September 2023. Comment letters received during this formal consultation will be published on the TNFD website, following the approach of international standards organisations.

In summary:

The TNFD beta framework has been viewed over 90,000 times by stakeholders in over 149 countries and territories, since the release of v0.1 in March 2022.
Over 750 pieces of topical feedback were received on v0.3 through the TNFD online portal or sent directly to the TNFD, from more than 150 organisations or individuals. This is a 50% increase in feedback compared to that received on v0.1 and v0.2, demonstrating the growing interest in the TNFD framework among market participants. Since the v0.1 release in March 2022 the Taskforce has received [2,200] individual feedback responses through the online framework portal and in the form of written, qualitative submissions to the Taskforce Secretariat.
Responses were received from financial institutions and corporates from a variety of sectors, including consumer goods, industrial, utility, materials, energy and information technology, as well as public sector institutions, academic and research organisations, business associations and intergovernmental, civil society and conservation organisations.
78 of the respondents provided detailed, qualitative feedback. The remaining provided quantitative feedback on the utility of different elements of the TNFD beta framework (see Figure 1 below).
Based on those respondents who identified their country, feedback was provided from 25 countries across Africa, Asia, Europe, Oceania and North and South America.
The top seven countries with the most respondents providing feedback, in order of feedback received, were the United Kingdom, United States, Japan, Australia, Brazil, Germany and the Netherlands.

Additional Content

User responses (n=86) on usefulness of components in the v0.3 beta framework

Overall, respondents found all framework components useful, with over 80% stating they were very useful to fairly useful. Some 19% of respondents found the concepts and definitions to be not that useful, while 18% found the approach to metrics and targets to be not that useful. In response, the TNFD has continued to build out the concepts and definitions and the approach to metrics and targets in this v0.4 beta release.

Key themes of feedback

The Taskforce has reviewed all of the feedback received on v0.3 of the beta framework. Feedback was provided directly to the Taskforce on a confidential basis, so an aggregated summary is provided here.

The feedback on v0.3 follows five broad themes on the need for:

Further clarity on the approach to materiality when following the TNFD disclosure recommendations;
Further alignment of the TNFD framework with key standards and related initiatives;
Specific guidance relevant for financial institutions;
Further improvements to technical aspects of the TNFD’s definitions, disclosure recommendations and LEAP approach, including on metrics, targets and scenarios; and,
A user-friendly guidance and framework structure.

Main feedback themes

The following tables provide additional information on the main feedback themes, the changes the Taskforce has made in response to this feedback in the v0.4 release, and the Taskforce’s plans leading up to the publication of the complete v1 framework in September 2023.

TNFD disclosure recommendations: Clarity on the approach to materiality

An ongoing theme in feedback to the Taskforce since publication of the v0.1 beta framework has been on the approach to materiality, with varied feedback depending on the type of organisation and jurisdiction

Additional Content

Feedback on approach to materiality

Feedback request

Taskforce response in v0.4 release

Feedback theme
Provide guidance on approach to materiality in the TNFD framework

Need further clarity on the approach to materiality, based on existing standards. Feedback was varied across which definition of materiality should be used (financial/single, double/ stakeholder materiality), but there was general agreement that the TNFD needs to be clear on how the flexible approach applies in the details of disclosure guidance, including metrics.

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Maintained the approach set out in v0.3 that the TNFD framework will provide adaptability and flexibility regarding the approach to materiality, to accommodate the preferences and regulatory requirements of report preparers and report users from organisations of all sizes across all jurisdictions;
Following this approach, added General Requirement 1 on materiality, which specifies that an organisation should provide in its disclosures a description of its approach to materiality , with reference to relevant standards where appropriate.
The draft guidance specifies that organisations should, where possible, distinguish which information is primarily relevant to specific stakeholder groups (e.g. investors, civil society).
Clarified that the selected approach to materiality applies to disclosures in the Strategy and Metrics and Targets pillars, with the Taskforce strongly encouraging inclusion of all indicators of relevance to an organisation, including Core Global and Sector Metrics, to provide a high level of comparability for report users and to demonstrate alignment with global policy goals.

Alignment with key standards and initiatives, including the Global Biodiversity Framework

Building on feedback on previous beta releases, market participants requested further details on how the TNFD framework aligns with other standards, global frameworks and related initiatives. A significant amount of feedback called for alignment with the Global Biodiversity Framework (GBF) of the Convention on Biological Diversity (CBD).

Additional Content

Feedback on alignment with other initiatives

Feedback request

Taskforce response in v0.4 release

Feedback theme
Reflect and integrate the Global Biodiversity Framework goals and targets

Need to ensure that the TNFD framework, and indicators and metrics in the framework, are aligned with relevant targets of the Global Biodiversity Framework, including Target 15

that requires transnational companies and financial institutions to “regularly monitor, assess and disclose their risks, dependencies and impacts on biodiversity”.

In response to this feedback, in the v0.4 beta release the Taskforce has:

Specified a set of Core Global Metrics linked to targets in the Global Biodiversity Framework.
Developed draft guidance on target setting, including examples of targets that align with the Global Biodiversity Framework.
The TNFD also ran an open webinar in February 2023 on the importance of the Kunming-Montreal Agreement and Target 15, and how the TNFD framework is being developed to operationalise Target 15, align metrics and targets to the GBF, and mobilise market participants through additional guidance by sector and biome. Over 2,000 participants from 1,100 organisations across 80 countries attended the session.

Feedback theme

Detail how an integrated approach with other initiatives is implemented in practice and degree of alignment with standards

Need for further detail on how application of the TNFD framework aligns with implementation of existing reporting frameworks and standards and those under development, including the TCFD framework, the International Sustainability Standards Board standards (ISSB – S1 and S2, and SASB), the Global Reporting Initiative Biodiversity Standard (GRI 304), the UN Guiding Principles on Business and Human Rights, the Science Based Targets Network (SBTN), the UN Sustainable Development Goals, CDP questionnaires, the European Sustainability Reporting Standards (ESRS), and EU Taxonomy, relevant ISO standards, BS 8632 on Natural Capital Accounting for Organizations, the Nature Benchmark Methodology developed by the World Benchmarking Alliance and the nature and climate scenario approaches being developed by the Network for Greening the Financial System (NGFS).

The v0.4 beta framework continues to build on the TCFD framework to enable an integrated approach to sustainability reporting.

It continues to be developed in close collaboration with the TNFD’s core knowledge partners, including ISSB, GRI, CDP, SBTN, the NGFS and the CBD Secretariat, and TNFD Forum members.

The full list of core knowledge partners is available here and the TNFD’s relationships with other initiatives are set out in the FAQs on the TNFD website.

Taskforce planned deliverables for v1.0:

The TNFD has begun an internal detailed review of alignment of the TNFD framework with existing and emerging standards. The Taskforce will publish a short document detailing alignment with leading individual standards, such as the ISSB S1 and S2 Standards, GRI Biodiversity standard and the European ESRS, as these are finalised after public consultation. The Taskforce welcomes feedback on what details on alignment would be most useful to market participants.

Guidance for financial institutions

A theme of feedback on v0.3 was a need to develop the guidance for financial institutions further, including at a portfolio level, and differentiate how it is distinct from guidance for corporates.

Additional Content

Feedback on the need to differentiate guidance for financial institutions and corporates

Feedback theme

Provide further tools and examples for application of the LEAP approach by financial institutions

Need more examples and tools to help financial institutions apply LEAP and quantify risk at the portfolio level

Need greater clarity and expectations on the types of nature-related risks that can be included in risk assessment, management and disclosure

In response to this feedback, in the v0.4 beta release the Taskforce has:

Published guidance on a set of risk assessment methods that can be used by financial institutions at a portfolio level, including heat mapping, asset tagging and value at stake analysis. These methods are also relevant for large corporates with complex supply chains.
Undertaken a set of pilot tests of these risk quantification methods with asset owners and published illustrative examples of the findings of these pilots.

Feedback theme

Guidance on disclosure, including metrics, relevant for financial institutions

Need to recognise the specifics for financial institutions in the TNFD guidance, including relevant and feasible core metrics, the reliance of financial institutions on corporate reporting, and the complexity of assessment and reporting across portfolios

In response to this feedback, in the v0.4 beta release the Taskforce has:

Published an update of the TNFD’s additional disclosure guidance for financial institutions.
Consolidated and updated the TNFD’s additional guidance for financial institutions applying the LEAP approach, which is included in a suite of additional sector-by-sector guidance published in v0.4.
Identified a set of core disclosure and assessment metrics applicable to financial institutions.
Acknowledged clearly that financial institution reporting of financed nature-related issues (the Scope 3 equivalent) will likely need to be phased in over time as reporting by their corporate clients increases.

Feedback theme

Consider application of scenario analysis both in the real economy and by financial institutions

Need to consider application of scenario analysis in both the real economy and by financial institutions

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Published draft scenario guidance, which includes content on scenarios for financial institutions and multinational companies.
Run a set of pilot tests with asset owners that included scenario analysis and collated learnings and insights from these pilots.

Taskforce planned deliverables for v1:

Sector guidance for financial institutions, including guidance on metrics, targets and scenarios, building on feedback from market participants and pilot testing.

Feedback on technical aspects of core components of the framework

The TNFD continued to receive feedback on technical aspects of v0.3 beta framework, such as core concept definitions, draft disclosure recommendations and the LEAP approach. The table below addresses the most significant technical feedback.

Additional Content

Feedback on core components of the framework and the TNFD response in v0.4

Feedback request		Taskforce response in v0.4 release
Definitions and core concepts
*Feedback theme* Clarity and consistency of definitions
Need clarity and consistency in definitions used in the framework, such as the definitions of criteria for priority locations and the definition of nature positive		In response to this feedback, in the v0.4 beta release, the Taskforce has: Updated its glossary, with new and amended concepts and definitions. These updated definitions are now on the ‘Concepts and definitions’ section of the online platform for the TNFD framework. Updated criteria for priority locations in the Locate phase of LEAP. The Taskforce has not updated its definition of nature positive, and is closely monitoring how this is being defined by credible science and policy bodies, including the Science Based Targets Network (SBTN), IUCN, the CBD and others. The Taskforce Secretariat is working closely with a range of other organisations to align on a consensus market definition for nature positive. Further details will be announced in the next few months.
*Feedback theme* Reframe definitions of stakeholders and rightsholders
Clarify definitions of stakeholders and rights-holders to recognise those that may be affected and the human rights that will be impacted, making explicit reference to Indigenous Peoples’ rights	In response to this feedback, in the v0.4 beta release, the Taskforce has: Incorporated feedback from the Discussion Paper published in November 2023 to release draft guidance on engagement with affected stakeholder that includes guidance on the rights of Indigenous Peoples and Free, Prior and Informed Consent (FPIC).
Taskforce planned deliverables for v1: Final guidance on Engagement with Affected Stakeholders

Draft disclosure recommendations

Feedback theme

Provide detailed guidance on new disclosure recommendation on value chains/traceability and climate-nature targets alignment

Provide guidance on assessment and disclosure along value chains, including in situations with limited data available.

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Consolidated the new disclosure recommendation on traceability into Risk and Impact Management A (ii), focused on upstream and downstream value chains, which recommends an organisation ‘describe the organisation’s approach to identifying nature-related dependencies, impacts, risks and opportunities in its upstream and downstream value chain(s) for assessment.’ The draft guidance for this disclosure recognises that disclosure of nature-related value chain issues may be initially complex for many report preparers and that the guidance is indicative of what would reasonably be expected over time as data to support these disclosures become more available and of higher quality.
Added detail in the draft disclosure guidance for disclosure recommendations Risk and Impact Management A(i) and A(ii) on the degree of location-specificity used (e.g. site-specific, local, national).
Added further tools to the TNFD Tools Catalogue, and tagged these by sector and biome, with coverage for direct operations, upstream and downstream.

Need for guidance on stakeholder engagement and examples of best practice

Need for human rights considerations in disclosures, including on stakeholder engagement

In response to this feedback, in the v0.4 beta release the Taskforce has:

Updated draft disclosure recommendation Risk and Impact Management D on engagement with affected stakeholders and provided draft disclosure guidance for this recommendation. This specifically recognises that stakeholders’ human rights may be affected.
Included a General Requirement on stakeholder engagement, in recognition that good stakeholder engagement is relevant across the TNFD Recommended Disclosures.
Published draft guidance on stakeholder engagement, which includes examples and best practice.

Need for guidance on alignment of climate and nature targets.

Need to note and provide guidance on where there are differentiated, integrated or trade-offs between climate and nature disclosures and processes

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Moved the proposed new disclosure recommendation on climate-nature targets alignment to be a General Requirement (5), recognising the importance of considering climate and nature connections across the TNFD Recommended Disclosures.
Incorporated considerations of climate, and the Paris agreement on climate, in the draft guidance on target-setting published in v0.4.

Taskforce planned deliverables for v1:

Finalised Recommended Disclosures and the accompanying guidance.
Additional guidance to identify the linkages between climate and nature, including synergies and trade-offs in target setting

LEAP approach

Feedback theme

Further guidance on all phases of LEAP

Provide additional guidance for the Locate phase of LEAP, including determining priority locations when data is limited.

Need guidance on relevant metrics for definition of ecosystem importance, integrity and recommended threshold for priority ecosystems

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Updated the draft guidance on the Locate phase of the LEAP approach for identifying priority locations. The updated Locate guidance is based on inputs from knowledge partners and experts.
Updated TNFD draft guidance for disclosure recommendation Strategy D which relates to high-risk locations, specifying what organisations should include in their disclosures.

Need for recommended datasets and tools that can be used at the Evaluate phase of LEAP

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Provided further links to tools and metrics for the Evaluate phase of LEAP, including by sector and biome, for an initial set of sectors and biomes.

Need for further guidance on the Assess phase of LEAP that includes a more defined approach to assess risks and opportunities

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Published guidance on a set of risk assessment methods that can be used when applying the Assess phase of the LEAP approach that are also relevant to the Locate and Evaluate phases. These include three methods: heat mapping; asset tagging and value at stake analysis.

Important considerations for sector guidance, including upstream and downstream impacts, and interconnectedness with climate change

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Published an initial set of additional sector- and biome guidance, which includes coverage of issues raised in feedback, such as upstream and downstream impacts and links with climate change.

Feedback theme

Need for further examples and case studies of application of the TNFD framework

Need worked examples of outputs at each phase of the LEAP approach to help users.

Recommendation to publish pilots with best practice examples.

The Taskforce has established a network of nearly 200 pilot tests underway globally and due to complete by 1 June 2023.

In addition, in response to this feedback, in the v0.4 release, the Taskforce has:

Published insights from a set of pilot tests of different methods of risk quantification by asset owners across portfolios.
Integrated the Knowledge Bank into the Framework site to provide organisations with additional resources and information

Taskforce planned deliverables for v1:

Finale LEAP Approach and accompanying guidance and case studies, based on feedback, including from pilot tests.

Metrics, targets and scenarios

Feedback theme

Further guidance on targets

Welcomed alignment with SBTN in co-developed targets guidance published in v0.3.

Need further general guidance on target setting for the TNFD framework.

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Published further guidance on target setting, which includes examples of targets aligned with the Global Biodiversity Framework.
Continued to work closely with SBTN as a core knowledge partner and will update relevant guidance as SBTN progresses its guidance on science-based targets for nature.

Feedback theme

Further guidance on metrics

The Taskforce received a range of feedback on considerations for further metrics development, including setting metrics by sector, including location-specific contextual information, quantitative metrics to assess impact and dependencies on nature, and a description of the process for managing impacts and dependencies and monitoring management of actions.

In response to this feedback, in the v0.4 beta release, the Taskforce has:

Published its draft approach to disclosure metrics, including a set of metrics annexes to the disclosure guidance. This has been developed with extensive input from knowledge partners, experts and market participants, including through a series of workshops.
Published its draft approach to response metrics in the Prepare phase of the LEAP approach.

Feedback theme

Further guidance on scenarios

Need to align scenario approaches to the approach being developed by the Network for Greening the Financial System (NGFS) and the Global Biodiversity Framework

Recommendation for scenarios to be based on business-as-usual for alignment with climate scenarios

In response to this feedback, in the v0.4 beta release the Taskforce has:

Published draft guidance on scenarios, drawing on feedback and insights from a set of pilot tests of the TNFD’s proposed approach, focused initially on use by corporates.
The TNFD is already collaborating with the NGFS Secretariat on scenarios development and will continue these efforts.

Taskforce planned deliverables for v1:

Update target setting guidance based on SBTN v1 methods guidance updates.
Finalised indicators and metrics included in the TNFD framework for both assessment and disclosure.
Scenario guidance for financial institutions, building on pilot testing and feedback from market participants.

User-friendly guidance and framework structure

The TNFD continues to receive feedback on the usability of its framework structure and guidance and its ease of implementation and uptake. In response, the TNFD framework site will be updated with additional functionality for the v0.4 release.

Additional Content

Feedback on the open innovation process and alignment with other initiatives

Feedback request

Taskforce response in v0.4 release

Feedback theme

Provide simplified and consistent structure of framework online and in offline PDFs

Consolidate the various v0.3 publications to make it easier to follow the framework content and guidance.

Need to improve consistency of materials.

In response to this feedback, in the v0.4 beta release the Taskforce has:

Updated and consolidated the online platform for the beta framework to be clearer and easier to navigate, including tailored additional guidance by sector and biome.
Begun to check consistency of materials, in preparation for the launch of v1 in September 2023.
Developed a preferences function (the ‘Dashboard’) to help organisations access additional sector and biome material relevant to their needs and interests
Updated the user experience and navigation tools to consolidate and simplify content on the framework site

Feedback

Provide guidance on skills needed to support TNFD implementation

Need for guidance on skills required to support implementation of TNFD framework

The Taskforce is assessing learning and capability building needs in the market to apply the TNFD framework.

Taskforce planned deliverables for v1:

A consolidated and concise presentation of the TNFD v1 framework and recommendations for the launch of the TNFD Framework and recommendations in September 2023.
The recommendations will likely include recommendations to international policy makers on key challenges in the ‘enabling environment’ for future TNFD adoption, including needs and gaps on data and analytics; and skills and capability building.