E2: Identification of dependencies and impacts by priority location

Guiding Question: What are our nature-related dependencies and impacts across our business at each priority location?

Dependencies and dependency pathways

Definition

Dependencies

Aspects of ecosystem services that an organisation or other actor relies on to function. Dependencies include ecosystems’ ability to regulate water flow, water quality, and hazards like fires and floods; provide a suitable habitat for pollinators (who in turn provide a service directly to economies), and sequester carbon (in terrestrial, freshwater and marine realms).

SBTN (2022) Working Definitions [unpublished]

Dependencies can be identified by working through a dependency pathway.

Definition

Dependency pathway

A dependency pathway shows how a particular business activity depends upon specific features of natural capital. It identifies how observed or potential changes in natural capital affect the costs and/or benefits of doing business.

Capitals Coalition (2016) Natural Capital Protocol

As illustrated in the figure below, an example of a sequence to map a dependency pathway is as follows:

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A particular business activity (e.g. coffee production plant) depends upon a specific ecosystem service (e.g. pollination of coffee plants). The pathway identifies how observed or potential changes in natural capital (e.g. decline in bee population due to human-induced habitat change) affect the cost or benefits of doing business (e.g. pollination services imported).

Dependency Pathway (coffee Beans Bees)

Impacts and Impact Pathways

Nature impacts can be identified by working through impact pathways.

Definition

Impacts

Changes in the state of nature, which may result in changes to the capacity of nature to provide social and economic functions. Impacts can be positive or negative. They can be the result of an organisation’s or another party’s actions and can be direct, indirect or cumulative.

SBTN (2022) Working Definitions [unpublished], CDSB (2021) Framework application guidance for biodiversity-related disclosures.

Definition

Impact drivers

A measurable quantity of a natural resource that is used as a natural input to production (e.g. the volume of sand and gravel used in construction) or a measurable non-product output of a business activity (e.g., a kilogram of NOx emissions released into the atmosphere by a manufacturing facility).

Capitals Coalition (2016) Natural Capital Protocol

Definition

Impact pathway

An impact pathway describes how, as a result of a specific business activity, a particular impact driver results in changes in natural capital, and how these changes in natural capital affect different stakeholders.

Capitals Coalition (2016) Natural Capital Protocol

An example of an impact pathway could be as follows: As a result of a specific business activity (e.g. chemical manufacturing plant), a particular impact driver (e.g. air emissions) results in changes in natural capital (e.g. reduced air quality) and how these changes impact different stakeholders (e.g. health problems).

A further example of an impact pathway is provided in the figure below.

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Relevant dependencies and impacts

The Natural Capital Protocol provides guidance for how organisations can undertake this process.

The tables below present a selection of potential impact drivers and dependencies to consider when identifying which are most material to your business. You will notice that a business activity (e.g., the use of water) can create both impacts and dependencies and thus appear in both tables. Note: the lists are not exhaustive; impacts and/or dependencies that are relevant to your business but not included here should also be considered.

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Useful Tools and Platforms

The following tools and platforms have been carefully selected by the TNFD to help support you in completing this phase of the LEAP process.

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