Nature-related financial disclosures could become mandatory for pension schemes in the UK within five years, according to Redington global head of sustainable investment, Anastasia Guha.

Speaking at the PLSA Annual Conference 2023 today, 18 October, on a panel exploring biodiversity and nature capital, Guha said one of the regulators, which she did not disclose, has said in regard to The Taskforce on Nature-Related Financial Disclosures (TNFD) becoming mandatory, it is working on a ‘have regard principle’.

“What that means is every piece of legislation that they are putting together, they think about TNFD as being mandatory, so what would that look like, how would the jigsaw fit. So, they are working on a have regard basis, which basically means five years, that’s what we think, within five years it’s probably going to be something that you have to do,” she said.

However, Guha believes that nature-related metrics are much more intuitive than climate metrics. “For those who are interested the ladder is a little bit of an easier climb than climate was, the problem as it always is, is governance budget, where does it fit in, when should it come in.”

Another panel member, MSCI executive director, climate investment research Sylvain Vanston, highlighted the intensity of the biodiversity crisis.

“Biodiversity loss is severe, the latest WWF Living Planet Report says that amongst all species we have seen a decrease of 69 per cent overall between 1970 and 2015,” Vanston said. He said that biodiversity loss is already reaching thresholds that we are trying to avoid on the climate side, such as 1.5 degree Paris Agreement temperature threshold.

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