Reuters reported that over 300 companies as well as financial institutions plan to communicate the impacts they've had on the natural world as part of the effort to prevent the worldwide collapse of biodiversity. This plan was heard by delegates at Davos on Tuesday.
These disclosures were created by the Taskforce On Nature-Related Financial Disclosures, which is supported by the G20. This should result in the aforementioned companies and institutions providing more transparency regarding the information the risk as well as the opportunities caused by their interactions with nature. All in all, this could yield positive results as these boards have the potential to be rewarded with investors and capital markets due to this transparency.
What Does Transparency Look Like?
The co-chair of the task force, David Craig, stated "This is a milestone moment for Nature finance and for corporate reporting." Craig went on to say that, "This is a clear signal that investors, lenders, insurers and companies are recognising that their business models and portfolios are highly dependent on both nature and climate and need to be treated as both strategic risks and investment opportunities." The task force itself is rooted in four ideas, Governance, Strategy, Risk, and Impact measurements. These disclosures are meant to force companies not only to assess and control these nature-related issues but also to discuss where improvements can be implemented. One of those companies is Norges Bank Investment Management and they also happen to be the largest owners of listed companies around the globe. In a statement NBIM's Chief Governance and Compliance Officer, Carine Smith Ihenacho said, "We are committed to leveraging this tool to deepen our understanding of our portfolio's nature-related impacts and dependencies, further reinforcing our responsible investment efforts in this important area ".
This report signifies progress in our efforts against climate change while maintaining current business practices without compromise. This would be positive in light of a recent report about 2023 being the hottest recorded year thus far.
HNGN recently reported that according to Politico, The Copernicus Climate Change Service (C3S) of the European Union confirmed a significant development on Tuesday. The average global temperature in 2023 has surpassed the previous peak observed in 2016, marking the highest recorded since the commencement of record-keeping in 1880. This revelation raises serious concerns, as the swift temperature increase poses a substantial challenge to the Paris climate agreement's ambitious target set over eight years ago - limiting Earth's warming to 1.5 degrees Celsius since pre-industrial times. The world briefly approached a warming of 1.48 degrees last year, perilously close to breaching this crucial threshold. The intensification of extreme heat is attributed to the climate crisis, primarily driven by the combustion of fossil fuels.
