In a landmark move for global sustainability reporting, the IFRS Foundation and the Taskforce on Nature-related Financial Disclosures (TNFD) have signed a formal Memorandum of Understanding (MoU) to integrate nature-related risks and opportunities into the heart of financial disclosures. The collaboration signals a pivotal step toward embedding biodiversity, ecosystem services, and natural capital into capital market standards.
“Nature is essential to our economies and our future,” said Razan Al-Mubarak, TNFD Co-Chair and President of the IUCN. “Our collaboration with the ISSB is a major step toward making nature visible in business reporting and how capital is allocated.”
Unifying Standards for a Nature-Positive Economy
The agreement ensures that the International Sustainability Standards Board (ISSB) will incorporate TNFD’s recommendations—released in 2023—into its ongoing standard-setting processes, including the BEES (Biodiversity, Ecosystems and Ecosystem Services) project. This move reinforces the ISSB’s mission to develop a global baseline for sustainability disclosures that are investor-focused, decision-useful, and market-relevant.
The collaboration builds on years of technical alignment and knowledge exchange. TNFD’s work has drawn heavily on ISSB-related frameworks, including the SASB sector standards, CDSB biodiversity guidance, and IFRS S1 and S2climate disclosure requirements.
Key Outcomes of the MoU:
- Joint standard-setting and market consultation, grounded in IFRS’s rigorous due process
- Co-development of enhanced metrics and guidance on biodiversity, ecosystems, and nature-related impacts
- Market engagement and capacity-building with businesses, investors, and regulators globally
- SASB standard enhancements to reflect nature dependencies and risks
Investor Demand Meets Regulatory Momentum
With over $44 trillion of economic value—more than half of global GDP—moderately or highly dependent on nature, the integration of TNFD’s frameworks into ISSB standards responds directly to investor calls for consistent, comparable, and transparent nature-related financial disclosures. It also supports the achievement of Target 15 of the Kunming-Montreal Global Biodiversity Framework, which calls on businesses to assess and disclose their impacts on biodiversity.
A Global Shift Toward Nature-Positive Finance
By working together, ISSB and TNFD are not only reducing fragmentation in sustainability reporting, but also laying the foundation for nature to become a central pillar of financial analysis, alongside climate.
As Erkki Liikanen, Chair of the IFRS Foundation Trustees, put it: “Transparency and accountability are a key means of enabling more stable, resilient and efficient capital markets.” With this partnership, nature is no longer peripheral—it’s becoming financially material.
