Understanding TNFD and SBTN: Corporate nature and biodiversity frameworks

May 9, 2024

Over half of the world’s GDP heavily relies on nature and its services. It has become imperative for businesses to understand their interconnection with nature and take action against biodiversity loss. According to a 2022 CDP survey, although nearly half of responding companies are considering biodiversity in their strategies, most fail to turn commitment into actions.

The Task Force on Nature-related Financial Disclosures (TNFD) and the Science Based Targets Network (SBTN) are two global frameworks providing essential guidance to help businesses integrate nature and biodiversity into their decision-making. This blog explores their approaches and how companies can adopt them to embark on their biodiversity journey.

Download our whitepaper for a comprehensive review of key concepts, global regulatory and voluntary reporting frameworks, and a step-by-step guide aggregating TNFD and SBTN approaches.

Corporate biodiversity: What companies need to know and how to get started

What is the Task Force on Nature-related Financial Disclosures (TNFD)?

Founded in 2021, the Task Force on Nature-related Financial Disclosures is a market-led, science-based and government-backed initiative that encourages and enables organizations to act on evolving nature-related issues. Inspired by the Task Force on Climate-related Financial Disclosures (TCFD), TNFD provides disclosure recommendations and guidance to help companies and financial institutions assess, report and act on their nature-related dependencies, impacts, risks and opportunities.

As of January 2024, 320 organizations from over 46 countries have committed to adopt TNFD recommendations and publish TNFD-aligned disclosures. TNFD has been integrated into ISSB, ESRS, GRI, and CDP reporting.

TNFD’s pillars and disclosure recommendations

Fully aligned with the Global Biodiversity Framework Target 15, TNFD offers 14 nature-related recommendations centered on four pillars—governance, strategy, risk and impact management, and metrics and targets, as listed below. TNFD mirrors the TCFD’s structure and adds three new recommendations and metrics for priority sectors and biomes.

  1. Governance:
    • Board oversight on nature-related dependencies, impacts, risks, and opportunities (DIROs).
    • Management role in assessing and managing nature-related DIROs.
    • Human rights policies and stakeholder engagement overseen by the board and management.
  1. Strategy:
    • Identified dependencies, impacts, risks, and opportunities over the short, medium, and long term.
    • Effects on business model, value chain, strategy, financial planning, and transition plans.
    • Strategy resilience to nature-related risks/opportunities considering various scenarios.
    • Priority locations of key assets/activities in direct operations and value chain(s).
  1. Risk and impact management
    • Direct operations processes for identifying, assessing, and prioritizing nature-related DIROs.
    • Value chain processes for identifying, assessing, and prioritizing nature-related DIROs.
    • Management processes for nature-related DIROs.
    • Risk management for integrating nature-related risk processes into overall risk processes.
  1. Metrics and targets
    • Metrics for assessing and managing material nature-related risks and opportunities.
    • Metrics for assessing and managing dependencies and impacts on nature.
    • Targets and goals for managing nature-related DIROs and performance against them.

TNFD’s LEAP approach

To help organizations identify and assess nature-related issues and prepare for the disclosures, TNFD offers a structured four-step LEAP approach, including locating the business interfaces with nature, evaluating nature-related dependencies and impacts, assessing risks and opportunities, and preparing to respond and report on these findings.

TNFD LEAP Approach (Source: TNFD)

The process starts with an initial scoping stage to create hypotheses about material nature-related DIROs (dependencies, impacts, risks, and opportunities), define assessment parameters, and align the internal team with the goals and timelines.

  1. Locate the business interfaces with nature: Identify the sectors, value chains, and geographic locations with moderate and high dependencies and impacts on nature. Prioritize potential nature-related issues, locate business activities, and determine if the locations are ecologically sensitive.
  2. Evaluate dependencies and impacts: Conduct a more detailed analysis of potentially material dependencies and impacts on nature. Measure the scale and scope of dependencies and impacts on nature by quantifying impact drivers, changes to the state of nature and ecosystem services, and the likelihood of the potential effects.
  3. Assess risks and opportunities: Identify nature-related risks and opportunities resulting from dependencies and impacts, prioritize risks according to magnitude and likelihood, and assess their materiality based on the financial effects on the business.
  4. Prepare to respond and report: Discuss internally on how to respond to the issues and what to disclose in line with the TNFD recommendations. Share findings with the executive board and stakeholders to inform strategy, risk management, capital allocation, and resource deployment.

TNFD disclosure metrics

TNFD suggests a set of core global metrics, core sector-specific metrics, and additional metrics for disclosures.

14 Core global metrics apply to all organizations, including 9 impact and dependency indicators and 5 risk and opportunity metrics. These metrics capture the foundational aspects of nature-related impacts, dependencies, risks and opportunities applicable across all sectors.

Driver of nature change / State of natureIndicator
Land/freshwater/ ocean-use change1. Total spatial footprint
2. Extent of land/freshwater/ocean-use change
Pollution/ pollution removal3. Pollutants released to soil by type
4. Wastewater discharged
5. Waste generation and disposal
6. Plastic pollution
7. Non-GHG air pollutants
Resource use/ replenishment8. Water withdrawal and consumption from areas of water scarcity
9. Quantity of high-risk natural commodities from land/ocean/freshwater
Climate changeGHG emissions (refer to TCFD and IFRS S2)
Invasive alien species and otherDraft indicator (to be further defined): Measures against unintentional introduction of invasive alien species (IAS)
State of natureDraft indicator: Ecosystem condition
Draft indicator: Species extinction risk
TNFD core impact driver and state of nature metrics (Source: TNFD)

Risk (Transition)1. Value of assets, liabilities, revenue and expenses that are assessed as vulnerable to nature-related transition risks
Risk (Physical)  2. Value of assets, liabilities, revenue and expenses that are assessed as vulnerable to nature-related physical risks
Risk (Transition -Liability)3. Description and value of significant fines/penalties received/ litigation action in the year due to negative nature-related impacts.
Opportunity (Business performance)4. Amount of capital expenditure, financing or investment deployed towards nature-related opportunities, by type of opportunity, with reference to a government or regulator green investment taxonomy or third-party industry or NGO taxonomy, where relevant.
Opportunity (Business performance – Products and services)5. Increase and proportion of revenue from products and services producing demonstrable positive impacts on nature with a description of impacts.
TNFD core global risk and opportunity assessment metrics (Source: TNFD)

TNFD disclosure metrics also include:

  • Core sector metrics address key nature-related issues for the following industries: oil and gas, metals and mining, forestry and paper, food and agriculture, electric utilities and power generators, chemicals, biotechnology and pharmaceuticals, aquaculture, and financial institutions.
  • Additional metrics: more extensive disclosure and assessment metrics for 5 drivers of nature change, state of nature, and ecosystem services.

What is the Science Based Targets Network (SBTN)?

The Science Based Targets Network was founded in 2019 as part of the Global Commons Alliance, aimed to transform economic systems and protect the Earth system. SBTN provides a framework and guidance for companies and cities to set science-based targets (SBTs) to avoid and reduce pressures on nature, restore and regenerate natural habitats, and address the drivers of nature loss.

Approximately 160 companies across over 30 countries are preparing to set science-based targets for nature through SBTN’s Corporate Engagement Program and partner network. By setting SBTs with SBTN, companies can align reporting with disclosure frameworks, such as GRI, CDP, and TNFD, and demonstrate their proactive management of nature-related issues to investors.

Key action areas of SBTN

SBTN builds on the success of the Science Based Targets initiative (SBTi) and extends its climate focus to encompass impacts on Earth’s natural systems, targeting five key areas to halt and reverse nature loss by 2030:

  • Reducing carbon emissions.
  • Preserving freshwater resources and water security.
  • Supporting biodiversity and ecosystem services.
  • Preserving and regenerating land systems.
  • Securing healthy, diverse oceans.

SBTN’s 5-step approach

SBTN develops a 5-step approach to guide companies and cities to set targets for a net-zero, nature-positive future. The process involves assessing material pressures, prioritizing locations and business components, measuring and setting targets, taking action, and reporting progress.

SBTN Framework (Source: SBTN)
  1. Assess: Identify and assess your organization’s impacts and dependencies on nature across its value chain. Use material screening tools to identify key areas for target setting.
  2. Interpret & prioritize: Determine target boundaries and rank locations using environmental and social materiality. Prioritize locations within target boundaries using additional criteria for urgency of action and co-benefits. Evaluate feasibility and strategic interest with additional social/human rights considerations.
  3. Measure: Select locally/globally developed models through stakeholder consultation. Create a baseline and target description, a timeline for achieving targets, and a time-bound program for acting on targets. Then, measure baseline impacts and set targets for issue areas and associated locations.
  4. Act: Follow the AR3T Action Framework for mitigation hierarchy to avoid future impacts, reduce current impacts, regenerate and restore ecosystems so that the state of nature can recover, and transform the underlying systems to address drivers of nature loss. Specific guidance is under development.
  5. Track: Monitor and report your progress and adjust your strategy as needed. SBTN has high-level measurement guidance with detailed Measurement, Reporting and Verification (MRV) guidance available in 2025.

SBTN targets

SBTN focuses on impacts on earth systems from direct operations and upstream activities with potential expansion into downstream impacts. Peer-reviewed guidance is available on target-setting for Freshwater and Land (details below).

Although SBTN has not developed guidance for biodiversity-specific targets, it offers a method for companies to prioritize areas of biodiversity importance when setting freshwater and land targets. By identifying locations where business activities disproportionately affect biodiversity, companies can set effective targets and optimize efforts to mitigate adverse impacts and promote positive outcomes.

Ocean targets are under development and expected to release in 2024.

SBTN Freshwater Targets

MeasureTarget statement example
Water quantity  Freshwater withdrawals from surface water bodies and groundwater[Annual] Company X will reduce its water withdrawal in the __ basin to __ ML/year by the year __.”

OR [Monthly] “Company X will reduce its water withdrawal in the __ basin to __ ML/ month for each of the following months. The reductions will occur by the year __.”
Water qualityThe total amount of nitrogen and phosphorus entering a surface water body during a given time.[Annual] “Company X will reduce its nutrient load in the __ basin to __ kg P (or N)/year by the year __.”

OR [Seasonal] “Company X will reduce its nutrient load in the __ basin to __ kg P (or N)/month for each of the following months. The reductions will occur by the year __.”

OR [Grey-water] “Company X will reduce its gray-water footprint in the __ basin to __ ML/year by the year __.”

SBTN Land Targets

DefinitionTarget statement example
No Conversion of Natural EcosystemsAvoid the wholesale change of a natural ecosystem to another land use, or a profound change in a natural ecosystem’s species composition, structure, or function, including deforestation*.[Direct operations] Company X will have zero conversion of natural ecosystems by [target year], compared with a 2020** baseline.
AND Company X will remediate all past conversion occurring between 2020** and [target year].

[Upstream] Company X will source 100% of volumes of commodities (Annex 1a Global or regional conversion-driving commodities) from areas known to be conversion-free from 2020**.
AND Company X will remediate all past conversion occurring between 2020** and [target year] (associated with its share of volumes sourced).
Land Footprint ReductionReduce the amount of agricultural land needed to produce the products in the value chain over time.[Absolute target] Company X commits to reduce absolute agricultural land footprint, from direct operations [and upstream impacts], [percent reduction]% by [target year] from a [base year] base year.

OR [Intensity target] Company X commits to reduce agricultural land footprint intensity, from direct operations [and upstream impacts] [reduction]% per [unit] by [target year] from a [base year] base year. This corresponds to a % change in absolute land footprint by [target year] from the [base year] base year.”
Landscape EngagementEnable regenerative, restorative, and transformational actions in materially relevant landscapes.Company X is engaged in [initiative name] and committed to a substantial improvement in ecological and social conditions by 2030.
*Companies that meet these FLAG target requirements must also set a No Conversion of Natural Ecosystems target under SBTN. **Or other earlier cut-off dates (e.g., regional or sectoral cut-off dates).

What are the differences between TNFD and SBTN?

While both TNFD and SBTN move businesses towards the same nature-positive outcomes, they are different in two aspects:


  • SBTN provides a prescriptive approach with methodologies and tools for setting quantifiable targets that align with current scientific understanding.
  • TNFD develops a structured framework with principles and guidelines for nature-related financial disclosure and risk management.


  • SBTN focuses on setting and achieving targets to reduce negative impacts.
  • TNFD encompasses a broader perspective by considering how businesses can contribute positively to nature, in addition to the negative impacts, and how this translates into financial risks and opportunities.

Companies can benefit from using both frameworks, given the complementary approaches. The SBTN framework refers directly to TNFD’s guidance and disclosures, while the SBTN can help companies turn TNFD assessments into action plans. As knowledge partners and technical collaborators, the two frameworks are aligned in several steps of their approach (see graph below), enabling companies to repurpose their data points.

TNFD and SBTN fundamental areas of alignment on target setting
TNFD and SBTN fundamental areas of alignment on target setting (Source: TNFD)

How to start your biodiversity journey following TNFD and SBTN

Here are three steps that aggregate the TNFD and SBTN guidance for companies to get started:

  1. Understand business interface with nature: Conduct a material screening of related sectors and activities across supply chains to identify where business activities, directly and indirectly, interact with nature.
  2. Assess and prioritize material dependencies, impacts, risks, and opportunities: Develop detailed material assessments using TNFD/SBTN recommended indicators to understand critical dependencies and impacts on nature and nature-related risks and opportunities to inform business strategies for target setting and risk management.
  3. Measure, set targets, and disclose: Follow SBTN guidance to measure baseline impacts and set freshwater and land targets for issue areas and associated locations. Prepare TNFD disclosures by creating responses to material issues, strategies, action plans, and risk management processes to achieve targets.

Download our whitepaper for a detailed step-by-step guide and additional resources for assessment.

About Aligned Incentives

Aligned Incentives offers AITrack, an AI-powered enterprise sustainability planning solution trusted by the world’s largest organizations. It helps companies efficiently assess all environmental issues—including climate change, water stress, biodiversity, and more—to achieve Net Zero goals and drive business success.

  • Custom LCAs at scale: We develop life cycle inventories tailored to the unique materials, technology, timeframe, and production region of your complete product portfolio, covering all business activities in your operation and value chain.
  • Systematic approach: You can quantify all types of environmental footprints consistently and efficiently based on the unified LCA Our future-proof solution enables you to create strategies that improve overall environmental impacts, preventing the optimization of one issue at the expense of others.
  • TNFD/SBTN aligned: We provide comprehensive assessments of corporate biodiversity using science-based methodologies and metrics recommended by TNFD/SBTN, allowing you to effectively pinpoint hotspots, set targets, and develop disclosures aligned with nature-based frameworks and regulations.

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