Another tool for analysing companies’ impacts and dependencies on nature was launched in Davos on Tuesday, with the UN Environment Programme (UNEP) and sustainability intelligence firm S&P Global Sustainable1 announcing the release of their Nature Risk Profile methodology.

Much like the free interactive tool released by conservation organisation WWF on Monday, the Nature Risk Profile is aimed at enabling the financial sector to measure and address nature-related risk by providing data on related impacts and dependencies.

“This methodology links science, policy and finance to bring nature to the heart of financial decision-making,” Neville Ash, director of UNEP’s World Conservation Monitoring Centre, said in a statement.

“The collaboration with a global financial data provider such as S&P helps to test the methodology using their location-specific data on thousands of financial and corporate assets,” he added.

According to the World Economic Forum’s 2023 Global Risks report, biodiversity loss is the fourth most severe global risk over the next ten years behind climate action failure, climate change adaptation, and extreme weather.

For this reason, the authors noted that global investors and other market participants need a credible, quantitative approach to measuring the biodiversity impact and dependencies of their operations and portfolios.

The Nature Risk Profile methodology was developed by a wide array of experts from across the conservation, business, and finance sectors. It has also been designed to align with the Taskforce on Nature–related Financial Disclosures (TNFD) and will facilitate related reporting requirements.

The methodology allows users to combine company-level information with nature-related data to calculate impacts and dependencies, using data from sources such as the Exploring Natural Capital Opportunities, Risks and Exposure database, and the forthcoming Ecosystem Integrity Index.

“The development of this new methodology will be key to unlocking better understanding, analysis and action around nature-related risks for companies and investors,” Richard Mattison, President of S&P Global Sustainable1, said in a statement.

The methodology is open access, and will be developed and refined by stakeholders to support transparency and adoption, the organisations said.

By Katherine Monahan – katherine@carbon-pulse.com

*** Click here to sign up to our weekly biodiversity newsletter ***