Evidence of a credible quantum of capital expenditure (CapEx) formally allocated towards fulfilling nature ambitions reassures financial institutions of a company’s commitment to planned strategy and provides confidence that actions will be implemented. Actions laid out in a company’s action plan should be mirrored in the CapEx during the planning horizon. This ensures that capital stock, working capital and overall business operations align with the company’s specific nature ambitions or targets. Some nature transition actions are highly capital-intensive (such as developing sustainable water infrastructure like water treatment facilities or irrigation systems to reduce the environmental impact of water use or performing large-scale reforestation projects). Others will likely require a high volume of research and development (R&D) investment in areas such as: desalination technologies that convert seawater into freshwater and new bio-based fertilizers and pest control methods to replace synthetic chemicals in agriculture. Additionally, this provides insight to financial institutions on what aspect of the nature transition requires financing. Financial institutions seek the following information from companies when assessing this indicator: –The amount of planned CapEx and R&D spending related to nature –The proportion of planned spending over a given time horizon –How the planned spending has been allocated towards specific actions to achieve nature ambitions and targets –Whether the planned spending is linked to the company’s material impacts and dependencies, and risks and opportunities –Whether the planned spending has been approved at the board level Existing frameworks that companies may be using: –TNFD: The recommended disclosure “Strategy B” questions how the impacts, dependencies, risks and opportunities identified have affected the company’s business model and value chain, as well as its financial planning, performance and cashflow.94 The TNFD discussion paper on nature transition plans includes guidance on developing and disclosing a financing strategy for the transition plan.95 –GFANZ: The Nature in Net-Zero Transition Plans consultation paper provides guidance on integrating nature financing strategies as part of net-zero transition plans.96 How financial institutions are getting started: The 2024 CDP and Oliver Wyman report Majority of European companies spend less than a quarter of capital expenditures on green initiatives found that 70% of European companies align less than a quarter of their expenditures with climate transition goals.97 It is likely that most companies do not have planned expenditures specifically allocated to nature. At this point, financial institutions have the opportunity to play a proactive role by engaging with companies on potential projects. Through this engagement, financial institutions can aid companies in defining projects that provide a foundation for the allocation of capital towards nature-based solutions. This support will enable companies to independently continue their budgeting and planning processes. Actions laid out in a company’s action plan should be mirrored in the CapEx during the planning horizon.2.9 Indicator 9: Planned spend Nature Positive: Corporate Assessment Guide for Financial Institutions 38

Nature Positive Corporate Assessment Guide for Financial Institutions 2025