A Breakdown of Nature Risk Data

Written By Rochelle March

Understanding how companies affect and depend on nature—like nature itself—can be deep and complex. Fortunately, emerging frameworks like the Taskforce on Nature-related Financial Disclosures (TNFD) and regulations like the Corporate Sustainability Reporting Directive (CSRD) are shaping how companies report on and manage nature-related risks.

The record high attendance at last week’s COP 16 in Cali, Colombia also shows the increasing focus on protecting biodiversity. The summit convened representatives from 196 countries to discuss the implementation of the Kunming-Montreal agreement, which sets 23 biodiversity targets for the decade. A key focus is the national biodiversity strategies and action plans (NBSAPs) that countries are expected to present, highlighting the urgent need for robust nature risk data and solutions to effectively monitor and achieve these targets.

This has lead to the creation of large datasets and solutions to tackle these challenges. But they’re not all the same. In fact, there’s multiple layers to this data ecosystem. It’s helpful to breakdown nature risk data into I.) Foundational, II.) Aggregate Metrics, III.) Nature-based Solutions and IV.) Reporting on nature-risk, plus some example datasets & initiatives.

I. Foundational Data

Foundational data serves as the bedrock for assessing nature-related risks and impacts. It encompasses detailed, often raw, data about:

  • Company Operations: Locations of facilities, supply chains, and resource extraction points.

  • Ecosystem Characteristics: Geographic distribution of ecosystems, biodiversity hotspots, and critical habitats.

  • Environmental Footprints: Quantitative data on a company's resource use (water, energy, raw materials), emissions, waste, and land use changes.

Foundational data is crucial for identifying where company activities intersect with vulnerable ecosystems. This data often requires integration of various sources, including satellite imagery, on-the-ground surveys, and company disclosures. Here’s some examples:

II. Aggregate Metrics & Risk Models

These datasets synthesize foundational data into higher-level indicators, indices, or risk assessments. They often highlight nature risk exposure through:

  • Risk Assessment Tools: Models that evaluate potential environmental risks associated with company operations and supply chains.

  • Key Performance Indicators (KPIs): Standardized metrics measuring environmental performance, such as biodiversity impact scores, water risk indices, or carbon intensity metrics.

  • Benchmarking Data: Comparative data that allows companies to evaluate their environmental performance against peers.

Aggregate metrics help translate complex environmental data into actionable insights for decision-makers. They can highlight systemic risks and benchmark performance against industry standards. Some examples include:

III. Nature-Based Solutions & Mitigation Data

This category includes data that helps companies identify opportunities for reducing their environmental impact through conservation, restoration, or sustainable management practices.

  • Project Opportunities: Information on potential NbS projects, such as reforestation, wetland restoration, or sustainable agriculture initiatives.

  • Ecosystem Services Valuation: Data that quantifies the benefits provided by ecosystems, including carbon sequestration, water purification, and biodiversity support.

  • Mitigation Strategies: Guidelines and best practices for reducing environmental footprints and enhancing resilience.

Nature-based solutions (NbS) are actions that protect, sustainably manage, and restore natural or modified ecosystems. Data in this category often focuses on the potential benefits of NbS and guides investment decisions. Exciting examples include:

  • Restor: An open data platform that connects restoration projects globally. It helps users map, monitor, and manage ecosystem restoration efforts, using scientific data and advanced tools to support decision-making and progress tracking. (free for individuals plus paid enterprise & government versions)

  • Cultivo: Builds investment portfolios of high quality natural capital that provide financial returns and conserve biodiversity. (paid engagement)

  • Terraformation: Focuses on accelerating native forest restoration globally to combat climate change and biodiversity loss. (paid engagement)

  • Pachama: Leverages technology to protect and restore forests, offering verified carbon credits to companies. (paid engagement)

IV. TNFD & Nature Risk Reporting

With the increasing recognition of nature-related risks in the financial and corporate sectors, there is a surge in demand for solutions that help companies measure, manage, and report these risks.

  • Risk Identification Tools: Software and analytics platforms that map dependencies and impacts on nature.

  • Reporting Frameworks: Guidelines and standards for disclosing nature-related risks, impacts, and performance.

  • Monitoring and Verification Systems: Technologies for ongoing tracking of environmental indicators and verifying nature-related data.

The Taskforce on Nature-related Financial Disclosures (TNFD) provides a framework for organizations to integrate nature into decision-making and disclosure processes. Examples include:

  • NatureMetrics: Specializes in biodiversity monitoring using environmental DNA (eDNA) technology. Their services enable companies to assess biodiversity impacts efficiently and accurately.

  • Dunya Analytics: Offers data analytics solutions focused on environmental risk assessment and sustainability reporting for businesses, converted into financial terms.

  • Nala Earth: Provides a data platform focused on natural capital accounting and environmental risk management for businesses and investors.

  • Metabolic: Their new Link platform specializes in biodiversity measurement.

  • NatCap and Leeana are other solutions focused on TNFD reporting.

Feel free to download this content, originally made for this post, as a PDF for quick reference.

Realizing ESG’s Full Potential

Nature risk can have layers and complexity, but your experience with it doesn’t have to. Understanding your nature risk can be an integral part of better readying for the challenges of today and tomorrow. Partner with us to see how to move your sustainability strategy forward.

Rochelle March http://www.rochellejmarch.com
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