TNFD Framework Architecture
Fourteen disclosures. Four pillars. One coherent system.
The TNFD Recommendations v1.0 organise nature-related disclosure around four thematic pillars and 14 recommended disclosures. This architecture was deliberately aligned with the TCFD to minimise additional reporting burden and to embed nature considerations within the same governance and strategic conversations where climate risk already sits. This lesson maps the full framework so you can navigate any TNFD disclosure requirement confidently.
The Conceptual Foundations
Before examining the four pillars, it is important to understand the conceptual architecture that underpins the entire TNFD framework. The TNFD Recommendations introduce several specific concepts that define what "nature-related" means in a disclosure context:
Nature: TNFD defines nature broadly as "the natural world, with an emphasis on the diversity of living organisms (including people) and their interactions amongst themselves and with their environment." It encompasses land, ocean, freshwater, and atmospheric systems.
Dependencies: Aspects of ecosystem services that an organisation or other actor relies on for business activities and processes. Dependencies include clean water supply, stable climate regulation, pollination, timber, and soil formation. When dependencies are degraded, business continuity is at risk.
Impacts: The effects (positive or negative) that an organisation or other actor has on nature, either through its direct operations or through its value chain. Impacts include habitat destruction, pollution, water abstraction, species disturbance, and greenhouse gas emissions that drive climate change, itself a major driver of biodiversity loss.
Nature-related risks and opportunities: These arise from the interplay of dependencies and impacts. Risks emerge from both the physical degradation of ecosystems (physical risks) and from societal responses to that degradation (transition risks). Opportunities arise from the development of nature-positive products, services, and business models.
Analogy: Dependency vs Impact as Two-Way Traffic
Think of a company and nature as two actors on a two-lane road. "Dependency" describes what travels from nature to the company: ecosystem services flowing into operations (water, soil fertility, pollination). "Impact" describes what travels from the company to nature: discharges, land use change, noise, species disturbance flowing outward. A complete TNFD disclosure requires mapping both directions of traffic, not just the one that affects the company's bottom line.
Pillar 1: Governance
The Governance pillar requires organisations to disclose how their boards and management bodies oversee nature-related issues. There are three recommended disclosures under Governance:
- G1: Describe the board's oversight of nature-related dependencies, impacts, risks, and opportunities (DIROs). This means identifying the specific board committee responsible, the frequency of nature-related reporting to the board, and the expertise or resources available to board members.
- G2: Describe management's role in assessing and managing nature-related DIROs. This addresses which management roles and processes own nature risk, how they integrate with broader risk management, and how nature considerations inform strategic decision-making.
- G3: Describe the organisation's human rights policies and engagement activities, and oversight by board and management, with respect to Indigenous Peoples, Local Communities (IPLCs), and affected stakeholders. This is unique to TNFD and reflects the recognition that nature governance is inseparable from social equity and land rights.
Pillar 2: Strategy
The Strategy pillar requires organisations to explain how nature-related issues affect their business model, value chain, strategy, and financial planning. There are four recommended disclosures:
- S1: Describe the nature-related DIROs identified over the short, medium, and long term. This requires the organisation to have completed a structured assessment process (such as LEAP) and to distinguish between different time horizons.
- S2: Describe the effect of nature-related DIROs on the organisation's business model, value chain, strategy, and financial planning, including any transition plans or analysis. This is where organisations explain concretely how their strategy is evolving in response to nature risk.
- S3: Describe the resilience of the organisation's strategy to nature-related risks and opportunities, taking into consideration different scenarios. Nature scenario analysis is an emerging methodology; TNFD provides supplementary guidance but acknowledges the field is less mature than climate scenario analysis.
- S4: Disclose the locations of assets and activities in direct operations and, where possible, upstream and downstream value chains, that meet the criteria for priority locations. This location-specific disclosure is a defining feature of TNFD and requires GIS-capable data infrastructure at more mature stages of implementation.
Pillar 3: Risk and Impact Management
The Risk and Impact Management pillar requires organisations to describe the processes they use to identify, assess, prioritise, and monitor nature-related DIROs. There are three recommended disclosures:
- R1: Describe processes for identifying, assessing, and prioritising nature-related DIROs in direct operations AND in upstream and downstream value chains. The value chain dimension is often the most challenging: it requires data from suppliers who may not have conducted their own nature assessments.
- R2: Describe processes for monitoring nature-related DIROs. This covers the data systems, tools, and reporting cycles used to track performance against nature-related commitments and to detect emerging risks.
- R3: Describe how nature-related risk processes are integrated into and inform overall risk management. This integration requirement ensures nature risk is not siloed in a sustainability function but embedded within the company's enterprise risk management (ERM) framework.
Pillar 4: Metrics and Targets
The Metrics and Targets pillar requires organisations to disclose what they measure and what they are aiming to achieve. There are four recommended disclosures:
- MT1: Disclose metrics used to assess and manage material nature-related risks and opportunities in line with strategy and risk management processes.
- MT2: Disclose metrics used to assess and manage dependencies and impacts on nature. TNFD provides a set of "core global metrics" as a starting point, covering land use, water, pollution, and biodiversity indicators.
- MT3: Describe the targets and goals used to manage nature-related DIROs and performance against them. Targets should be time-bound, measurable, and, where possible, science-based.
- MT4 (for financial institutions only): Disclose metrics used to assess and manage nature-related risks and opportunities in the institution's financing and investment activities, including exposure to sectors highly dependent on or impactful to nature.
Core Global Metrics
TNFD specifies a set of "core global metrics" that all organisations should consider disclosing. These are divided into two categories:
| Metric Category | Example Core Metrics | Reporting Basis |
|---|---|---|
| Land and freshwater use | Total land use by type (ha); water withdrawal by source (ML) | Comply or explain |
| Ocean and sea use | Total area of ocean use (km²); volumes and destinations of ocean discharges | Comply or explain |
| Pollution | Nitrogen and phosphorus loading; plastic waste; other pollutants to water and land | Comply or explain |
| Greenhouse gases | Scope 1, 2, 3 GHG emissions (aligned with GHG Protocol/TCFD) | Comply or explain |
| Biodiversity | Area and quality of habitat in or adjacent to priority biodiversity areas; number of IUCN Red List species in operations | Comply or explain |
| Capital expenditure | Percentage of capex/opex aligned with nature-positive objectives | Encouraged |
General Requirements
In addition to the 14 recommended disclosures, TNFD specifies six general requirements that apply across all four pillars. These general requirements define the rules of the disclosure game:
- Materiality: Disclosures should focus on material nature-related issues using a process consistent with the organisation's overall materiality determination. TNFD is compatible with both financial materiality and double materiality approaches.
- Scope: Disclosures should cover the organisation's full value chain, with at least direct operations and tier-1 suppliers covered initially.
- Location: Nature-related issues should be assessed and disclosed with reference to specific geographic locations where relevant.
- Integration: Nature disclosures should be integrated with, or clearly cross-referenced to, other sustainability disclosures (especially climate).
- Time horizons: Disclosures should cover short (0-3 years), medium (3-10 years), and long-term (10+ years) time horizons.
- IPLC engagement: Organisations should describe their engagement with Indigenous Peoples, Local Communities, and affected stakeholders in identifying nature-related issues.
Example: A Mining Company Applying the Four Pillars
A global mining company applying the TNFD framework might disclose: Under Governance, that its Board Sustainability Committee reviews nature-related risks quarterly and engaged an external ecologist for specialist advice. Under Strategy, that its Zambian copper operations are located adjacent to a Key Biodiversity Area and face both physical risk (water scarcity from watershed degradation) and transition risk (stricter environmental permitting). Under Risk Management, that LEAP assessments are conducted for all new project sites. Under Metrics and Targets, that the company targets zero net loss of critical habitat and has committed to rehabilitating 110% of disturbed land by end of mine life.
The ISSB (International Sustainability Standards Board) issued IFRS S2 on climate-related disclosures in 2023, effectively institutionalising TCFD requirements within mandatory international financial reporting. The ISSB has explicitly stated that it will draw on TNFD as the reference framework when it develops a future standard on nature. This means TNFD-aligned companies are not just meeting voluntary expectations; they are preparing for what is likely to become a mandatory international standard. TNFD designed its framework with ISSB interoperability in mind: both use the same four-pillar architecture, the same materiality concept, and the same enterprise-value focus. The additional TNFD requirements (location, IPLC engagement, impact assessment) are designed to sit alongside, not in conflict with, the ISSB baseline.
Key Takeaways
- 1The TNFD framework is built on four pillars with 14 recommended disclosures: Governance (3 disclosures), Strategy (4 disclosures), Risk and Impact Management (3 disclosures), and Metrics and Targets (4 disclosures)
- 2A critical innovation is TNFD's explicit framing of both 'dependencies' (what nature provides to business) and 'impacts' (what business does to nature), requiring organisations to map both directions of their relationship with nature
- 3The Governance pillar uniquely requires disclosure of human rights policies and engagement with Indigenous Peoples and Local Communities, reflecting TNFD's recognition that nature governance and social equity are inseparable
- 4Six general requirements apply across all four pillars, covering materiality, scope (value chain), location specificity, integration with other standards, time horizons, and IPLC engagement
- 5TNFD is designed for convergence with ISSB standards, positioning voluntary TNFD adopters ahead of likely future mandatory international requirements on nature-related financial disclosure