Nature Positive Corporate Assessment Guide for Financial Institutions 2025

–Nature-related risks (physical and transition- related) identified in the nature materiality assessment: –Physical risks result from the degradation of nature (such as changes in ecosystem equilibria, including soil quality and species composition) and consequential loss of ecosystem services on which a business model depends22 (such as the loss of freshwater for a beverage company or loss of pollinators in agriculture). –Transition risks stem from misalignment of economic actors with actions aimed at protecting, restoring and/or reducing negative impacts on nature. They come from five sources: policy, market, technology, reputation and liability risks.23 For example, companies in the oil and gas industry are exposed to significant transition risks, such as non-compliance with shifting environmental regulations. –The timeframe in which these risks are expected to manifest (short-, medium- and long-term) impacts risk. –Nature-related opportunities identified in the nature materiality assessment: –Business performance: Where the company has opportunities to develop its business model, reputation and resilience through increased resource efficiency, new products/ services, market access and valuation, or access to new capital flows –Sustainability performance: Where the company has opportunities to optimize its activity through actions that preserve habitats and ecosystems, such as through ecosystem protection, restoration and regeneration or the sustainable use of natural capital Existing frameworks that companies may be using: –TNFD: LEAP is an integrated approach for identifying and assessing nature-related issues. It is designed for use by organizations of all sizes across all sectors and geographies.24 TNFD has also published recommendations on the disclosure of nature-related impacts and dependencies, and risks and opportunities.25 –SBTN: The SBTN Framework Step 1: Assess and Step 2: Prioritize offer a prescriptive approach to screening nature impacts in the company’s direct operations and upstream, assessing where to act first and which locations and economic activities to include within target boundaries.26 –Global Reporting Initiative (GRI): This presents a four-step approach to identifying and assessing material impacts.27 –CSRD/European Sustainability Reporting Standards (ESRS): This provides guidance on conducting double materiality assessments, including steps for understanding the context, identification and assessment of impacts, risks and opportunities, and their subsequent disclosure.28 –Nature benchmarking initiatives – such as Nature Action 10029 and the World Benchmarking Alliance (WBA)30 – state expectations around a company’s assessment of its nature-related issues. Nature Positive: Corporate Assessment Guide for Financial Institutions 18