The International Sustainability Standards Board (ISSB) has taken a major step forward in aligning global sustainability disclosure by deepening its collaboration with the Taskforce on Nature‑related Financial Disclosures (TNFD). The partnership builds on a memorandum of understanding and signals a shift toward treating nature-related risks and opportunities with the same seriousness as climate change within corporate reporting frameworks.

Under the agreement, the ISSB will draw on the TNFD framework, including its 14 recommended disclosures, “Locate-Evaluate-Assess-Prepare” (LEAP) methodology, sector-specific guidance and metrics, as it explores introducing incremental nature-related disclosure requirements beyond its current standards, IFRS S1 “General Requirements for Disclosure of Sustainability-related Financial Information” and IFRS S2 “Climate-related Disclosures”. The goal is to develop a global baseline for sustainability reporting that includes biodiversity, ecosystems and ecosystem services (BEES), thus reducing fragmentation across different frameworks.

For companies and investors, the implications are growing. Many organizations have already adopted or aligned with the TNFD recommendations voluntarily, and the ISSB’s move means that nature-related disclosures will likely become more mainstream, more comparable, and more embedded in financial reporting. Firms that have been embedding nature-risk assessment into strategy, governance, and metrics are better positioned for what’s ahead.

However, the work ahead is complex. The ISSB has signaled that it may issue an exposure draft of incremental nature-related disclosure requirements by around October 2026, subject to public consultation. Preparation will involve adjusting data systems, governance, and strategy to capture dependencies, impacts, and opportunities related to nature across value chains. For some companies, especially those in sectors such as agriculture, mining, forest products, or supply chains dependent on natural capital, this will be a substantial shift. Smaller or less-prepared firms may face significant scaling of effort to meet investor expectations and unlock capital flows aligned to nature-positive outcomes.

In short, the ISSB’s move to build nature into the global sustainability reporting architecture marks a turning point. Nature-related financial disclosures are rapidly becoming a central element of corporate transparency, risk management and investor decision-making, and organizations should begin preparing now to respond.

Source:

https://onestopesg.com/esg-news/global-disclosure-frameworks-align-ifrs-foundation-and-taskforce-on-nature-related-financial-disclosures-tnfd-deepen-cooperation-as-international-sustainability-standards-board-issb-advances-nature-related-standard-setting-1762741839603