Nature Positive Corporate Assessment Guide for Financial Institutions 2025

2.1 Indicator 1: Material nature risks and opportunities, and impacts and dependencies Although most companies are yet to develop nature transition plans, growing numbers have undertaken internal assessments along the lines of TNFD LEAP and SBTN to understand their nature-related impacts and dependencies as well as associated risks and opportunities. Disclosing material impacts and dependencies identified through this assessment provides valuable information to financial institutions on starting points for companies. It additionally helps financial institutions understand which areas require significant effort for the transition (for example, business sites with elevated impacts on water use or pollution), present risks (transition or physical) and business opportunities derived from new business models and technologies. Financial institutions seek the following information from companies when assessing this indicator: –Availability of nature materiality assessment: –Financial institutions seek to understand whether and how an assessment of nature- related issues has been conducted by the company – using the TNFD LEAP approach or applying SBTN “Step 1: Assess” and “Step 2: Prioritize”. –Financial institutions additionally want to know whether the company has disclosed nature-related issues using a single or double (e.g. CSRD) materiality approach (TNFD General Requirement 1). A single materiality approach is associated with disclosure of information on how nature impacts the organization’s financial performance (“outside-in”). A double materiality approach is associated with disclosure of how the organization impacts nature (“inside-out”) and vice versa (“outside-in”). –Scope of nature materiality assessment: –Which business units, geographies, products and outputs have been considered and whether the assessment extends to the whole value chain, such as in TNFD General Requirement 219 –Impacts and dependencies identified in the nature materiality assessment: –Material impacts and dependencies of the company on nature, such as water removal and land use –Magnitude of the impacts on nature – expressed as high/medium/low –Relevant location- and value chain-specific details, such as whether these issues are related to where the company’s operations are located Although most companies are yet to develop nature transition plans, growing numbers have undertaken internal assessments along the lines of TNFD LEAP and SBTN. This section will dive into each of the 11 indicators that financial institutions need to understand in order to assess companies’ nature performance and transition plans, and provide insights on how financial institutions are getting started today. 17 Nature Positive: Corporate Assessment Guide for Financial Institutions