What is the TNFD
Nature-Related Disclosures and the TNFD Framework
While Australian companies have spent the past two years preparing for mandatory climate reporting under Australian Accounting Standards Board Standard S2 (AASB S2), a parallel conversation has been building in the background: what comes next for nature and biodiversity reporting.
The Taskforce on Nature-related Financial Disclosures (TNFD) framework (published in final form in September 2023) is the most developed framework to date. It is currently voluntary. But the regulatory direction of this is becoming clearer, and for companies that want to understand what is coming, now is a sensible time to start paying attention.
What Is the TNFD?
The TNFD is a global, market-led initiative that provides a framework for organisations to identify, assess, manage and disclose their nature-related risks and opportunities. It was developed over two years by a taskforce of 40 senior executives from companies and financial institutions, drawing on input from scientific and conservation organisations, governments and industry.
The framework is structured around the same four pillars as the Task Force on Climate-related Financial Disclosures (TCFD) — governance, strategy, risk management, and metrics and targets — and contains 14 recommendations, 11 of which directly mirror the TCFD’s recommended disclosures. For any organisation already familiar with TCFD or AASB S2, the structural logic will feel recognisable.
A key feature of the TNFD is its Locate, Evaluate, Assess, Prepare (LEAP) approach — a practical methodology for identifying where a company’s operations and supply chains intersect with nature, evaluating the dependencies and impacts at those locations, assessing material risks and opportunities, and preparing disclosures accordingly.
Why Nature Matters to Business
The case for nature-related disclosure begins with the scale of economic dependence on natural systems. The Biodiversity Council’s May 2026 report on the ASX200 found that an estimated 49.3% of Australia’s gross domestic product (GDP) is moderately or highly dependent on natural systems — including water availability, soil health, pollination, coastal protection and climate regulation. Ongoing degradation of these ecosystem services is projected to cause an annual global GDP reduction of up to 2.3% by 2030.
For individual companies, nature-related risks manifest in several ways: supply chain disruption where operations depend on water, soil or biodiversity; regulatory and legal exposure as governments move to protect ecosystems; physical asset impairment where facilities are located in or near biodiversity-sensitive areas; and reputational risk where companies are seen to be contributing to habitat or species loss.
Unlike climate risk, where greenhouse gas emissions provide a relatively standardised measurement basis, nature-related risks are more complex. They operate across multiple, interdependent pathways and are inherently location-specific — a risk to a freshwater ecosystem in Queensland is different from a risk to a marine environment off Western Australia.
Where Things Stand Globally and in Australia
As of late 2025, 733 organisations globally (representing more than USD 22.4 trillion in assets under management) had voluntarily committed to TNFD-aligned disclosures. In Australia, 23 companies including Qantas, Telstra, Brambles, Bank Australia, EnergyAustralia and Blackmores have committed to early adoption, reporting on their nature-related issues as part of their annual corporate reporting from financial year 2024–25 or 2025–26.
The more significant development came in April 2026, when the International Sustainability Standards Board (ISSB) confirmed it will develop a nature-related Practice Statement drawing substantially on the TNFD framework, with an exposure draft expected by October 2026 which is timed to coincide with the Convention on Biological Diversity’s COP17 meeting. This does not create mandatory reporting obligations immediately, but it signals clearly that nature-related disclosure is moving toward the same mainstream treatment as climate.
The Australian Government has provided foundational funding for TNFD development and hosted the Global Nature Positive Summit in Sydney in October 2024. Australia is also a signatory to the Kunming-Montreal Global Biodiversity Framework which is the international agreement to halt and reverse nature loss by 2030.
Australia’s Particular Context
Australia has specific characteristics that make nature-related disclosure both more complex and more important than in many other countries. It is one of the world’s most biodiverse nations and also one of its most significant contributors to biodiversity loss, with high rates of habitat clearing, invasive species pressure and ecosystem degradation.
One aspect of Australia’s nature story that is underappreciated in a corporate reporting context is its biosecurity infrastructure. Australia’s border force and immigration settings reflect one of the most stringent biosecurity regimes in the world which gives recognition that the integrity of Australia’s natural systems has genuine economic and ecological value. Attributing actual data to that position such as the cost of biosecurity interventions, the ecosystems they protect, the species at risk, would be a meaningful contribution to the nature-related disclosure conversation. It is an area where Australia could demonstrate genuine data leadership if the ambition existed to do so.
Our View
Discussions that we have had with clients and companies on nature and biodiversity have been genuinely hopeful and positive. There is real interest in the topic and, in many cases, real goodwill. What is also clear is how little data currently exists within most organisations.
There is a real risk that if mandatory nature-related reporting arrives before the data infrastructure exists to support it, the result will be a reporting suite that looks comprehensive on the surface but lacks meaningful substance. Good intentions expressed in qualitative language, without the operational and supply chain data to support them, is a pattern we have already seen in early climate reporting. Nature reporting is likely to face a more acute version of that challenge, given the complexity and location-specificity of the underlying data.
Our view on the next two to three years is that Australian companies will remain primarily focused on climate reporting. Nature-related disclosure is likely to sit in the background during this period, with voluntary early adoption concentrated in sectors with the most obvious nature dependencies.
Looking further, we believe Australian companies are starting from a lower baseline level of knowledge and data on nature-related risks compared to where they were when climate reporting began. It is likely to take five or more years before the language, data and metrics used in nature-related disclosures become more understood, and that trajectory will depend heavily on whether the ISSB’s Practice Statement, once released, provides the same degree of structural clarity that AASB S2 has provided for climate.
What Companies Can Do Now
For most Australian companies, nature-related disclosure is not an immediate reporting obligation. The value of beginning to engage with it now is to prepare. Specifically:
- Identify where your operations and supply chains intersect with nature-sensitive locations or natural systems. The TNFD’s LEAP methodology provides a structured way to do this.
- Assess which sectors of your supply chain carry the highest nature-related dependencies (water, land use, raw material sourcing and agricultural inputs are common starting points).
- Build familiarity with the TNFD framework now, particularly if your organisation already reports under AASB S2. The structural overlap is significant and the learning curve is shorter than it was for climate.
- Watch the ISSB exposure draft when it is released in October 2026. That document will provide the clearest signal yet of what mandatory nature-related disclosure is likely to require.
Companies in agriculture, mining, property, water utilities and food and beverage, where we believe the dependencies on natural systems are most direct, shoudl be starting this work early.
Sources
- Taskforce on Nature-related Financial Disclosures (TNFD), Final Recommendations and Guidance, September 2023, tnfd.global
- TNFD, Number of Australian TNFD Adopters Rises to 23, October 2024, tnfd.global
- Biodiversity Council, Cracking the Code: Using Nature Data to Understand the Impact of the ASX200, May 2026, biodiversitycouncil.org.au
- International Sustainability Standards Board (ISSB), announcement on nature-related Practice Statement, April 2026
- Australian Institute of Company Directors (AICD), TNFD Releases Framework for Nature-related Financial Reporting, 2023, aicd.com.au
- Department of Climate Change, Energy, the Environment and Water (DCCEEW), Investing in Nature, updated 2026, dcceew.gov.au
- Gilbert + Tobin, Nature-related Disclosures: What Next for Australian Companies?, July 2025, gtlaw.com.au
- Australian Government, Australia’s Strategy for Nature 2024–2030
Anabranch ESG Advisory provides independent advice on ESG strategy, climate disclosure, and sustainability reporting. The information in this article is general in nature and does not constitute legal or financial advice.
