Nature Risk Profile

Make PDF

What is a Nature Risk Profile?

• The Nature Risk Profile is aimed at enabling the financial sector to measure and address nature-related risk by providing scientifically robust and actionable analytics on nature impacts and dependencies.
• The new methodology outlines metrics and data that enable companies and investors to identify and quantify nature-related exposure. 
• It covers several key areas, including risks arising from companies’ impacts on biodiversity, risks arising from companies’ dependencies on biodiversity and potential risks via proximity to biodiverse areas.
• The launch of the Nature Risk Profile methodology follows on the heels of the adoption of the Kunming-Montreal Global Biodiversity Framework, in December 2022. 
• The Global Biodiversity Framework includes a target for governments to take legal, administrative or policy measures to encourage and enable businesses to regularly monitor, assess, and transparently disclose their risks, dependencies and impacts on biodiversity. 
• Governments furthermore agreed that these requirements apply to all large as well as transnational companies and financial institutions along with their operations, supply and value chains, and portfolios.
• According to the World Economic Forum’s 2023 Global Risks Report, biodiversity loss is the fourth most severe global risk over the next ten years behind climate action failure, climate change adaptation, and extreme weather.
• The potential impact of the Nature Risk Profile methodology is significant, transforming the parameters of financial decision-making. 
• Developed by experts from across the conservation, business, and finance communities, it aligns with the emerging approach of the Taskforce on Nature-related Financial Disclosures (TNFD) and will support the implementation of TNFD’s disclosure framework.
• The methodology allows users to combine company-level information with best-practice nature-related data to calculate vital risk metrics. 
• It is built around using powerful, science-based impact and dependency measurement tools, including the Exploring Natural Capital Opportunities, Risks and Exposure database and the developing Ecosystem Integrity Index.
• The methodology provides a major step forward to deliver the actions required for transformative change and support the finance sector’s critical contribution to delivering the ambitions of the Kunming-Montreal Global Biodiversity Framework. 
• This methodology links science, policy and finance to bring nature to the heart of financial decision-making. 

Make PDF