Nature must be fully integrated into the global baseline for sustainability-related disclosures. Clear guidance from the ISSB on this will provide the consistency and uniformity that businesses and investors need.
André Hoffmann, Chair of Capitals Coalition’s Supervisory Board
Anyone watching the news covering the extreme weather events over the last couple of months must have felt a growing feeling of unease. There is an inconvenient, unmistakable truth on everyone’s doorsteps: change is happening, it is material to our daily lives and to future prospects in our economy, and it is very likely that it is only beginning.
For example, according to the Peterson Institute for International Economics, contemporaneous economic losses will be on the order of $986 billion in 2027 if the intensity of El Niño winds up of similar magnitude to the last Super El Niño in 1997–98. Indeed, the forecasts of economic cost related to El Niño currently range from 5-7 trillion USD, bringing the economic impact close to matching the loss of GDP during the 2008 crash. The UN World Food Programme’s early analysis projects that expected changes in the intensity of El Niño will create acute food insecurity for at least 49 million more people, bringing the total number of people unable to meet their daily food needs to rise from approximately 225 to 274 million: an increase of approximately 22%.
The change is real. The risk is real. And it’s systemic, because climate and nature are profoundly dependent on and linked to each other. The correlated economic consequences of this systemic risk are becoming impossible to ignore and are unavoidable. With this context, integrating nature into the global baseline for sustainability-related financial disclosures is not a nice-to-have but an imperative. It is the only way to provide decision-makers and investors with the information they need to direct capital and decisions towards a carbon-neutral, nature-positive future.
There are nature-related disclosure requirements from the Global Reporting Initiative (GRI), Taskforce on Nature-Related Financial Disclosures (TNFD), and European Financial Reporting Advisory Group (EFRAG). Also, the General Requirements for Disclosure of Sustainability-related Financial Information (IFRS S1), issued by the International Sustainability Standards Board (ISSB), cover nature, as they require disclosure of all sustainability-related risks and opportunities that could reasonably be expected to affect the entity’s prospects, including nature-related ones. And yet, according to the 2025 TNFD Status Report, nature-related dependencies is poorly understood and underexplored, despite being a critical pathway to financial risk. Only recently, the 2026 TNFD Status Report shows promising progress in the awareness of nature risks as financial risks, as well as a greater confidence to assess and disclose material nature-related issues. It also presents a clear call from both report preparers and investors on the need for mandatory reporting requirements and alignment between standards and regulation.
Every company depends on nature, yet those dependencies remain largely invisible in decisions about capital and long-term value. The ISSB’s nature consultation can change that by making them visible, comparable and decision-useful, grounded in established science, accounting and market practice.
Éliane Ubalijoro, CEO of the Landscape Alliance and Director General of World Agroforestry (ICRAF)
This is where the ISSB enters the scene again, as it is uniquely positioned to advance uniformity across disclosure frameworks and ensure aligned application across markets and sectors that deliver a level playing field and helps avoid confusion. That’s why its current efforts to strengthen the integration of nature in its global baseline for sustainability-related financial disclosures are so important. ISSB has announced the publication of an Exposure Draft with additional requirements and guidance in October 2026 and will run a consultation on its proposals until early next year.
A pivotal step: with more than 44 jurisdictions already adopting or considering ISSB standards, what’s decided now could shape global sustainability reporting for years to come. With this importance in mind, Capitals Coalition has identified five critical success factors that should be met and has designed a scorecard. We invite organizations to keep the five criteria in mind when engaging with and supporting ISSB’s consultation on the exposure draft and to use the scorecard. We must unleash our collective power and insights to ensure the effectiveness of the integration of nature into the global baseline for sustainability-related financial disclosures.
5 Critical Success Factors
with key concepts and terms already embedded in the IFRS Accounting and Sustainability Standards and the best available science and market practice.
of nature-related issues for reporting entities, investors and stakeholders. Companies must be able to identify and assess their impacts and dependencies on nature, and the resulting nature-related risks and opportunities.
must be the foundation for the disclosure requirements. The format of information provided should be consistent with financial information applied in general purpose financial reporting. Therefore, using monetary valuation of dependencies, impacts, risks and opportunities where possible to enable assessment of the estimated current and anticipated future financial effects thereof for the particular entity.
at a granularity that provides report users with the ability to contextualize nature-related information. To identify nature-related risks and opportunities, assess resilience, and set nature-related targets, investors need nature-related disclosures that are location-specific.
across reporting entities ensures aligned application. With support from IOSCO and the desire among companies and regulators to assert compliance with IFRS Standards, the ISSB is uniquely positioned to boost uniformity, ensure aligned application across markets and sectors, and deliver a level playing field.
It is too important to fail. It must succeed.
