1) The initial release of CSRD reports will focus attention, scrutiny, & benchmarking on nature & biodiversity
2025 will mark the first disclosures of companies impacted by the European Union’s CSRD (Corporate Sustainability Reporting Directive), the ~11,000 companies who were within scope of the prior, more limited NFRD (Non-financial Reporting Directive).
This will be the first round of reporting. It will generate heightened scrutiny and benchmarking. Have industry peers taken different approaches to their double materiality assessment, particularly on biodiversity? Do leading companies disclose robust risk management and targets, thereby setting the standard for their industry?
Nala will pay close attention to disclosures on Pollution (ESRS E2), Water and marine resources (ESRS E3), and Biodiversity and ecosystems (ESRS E4) - the three Standards we support customers on.
2) TNFD adoption will continue to increase, especially in lagging geographies like Germany and China, and while leading companies will set targets with SBTN
At COP16, TNFD (Taskforce on Nature-related Financial Disclosures) announced that over 500 organisations had committed to public TNFD disclosures. TNFD already cites ~40 public TNFD disclosures as examples, including Breitling, who Nala supported.
Expect hundreds more to follow over 2025, providing concrete examples across industries and sectors, and raising expectations for companies to publish their own TNFD disclosures.
Nala has seen many companies use TNFD’s LEAP framework (Locate, Evaluate, Assess, Prepare) as a helpful guide to corporate nature management and CSRD preparation. More of them will begin to disclose their work publicly. Though Germany (six public adoptees) and China (seven) are lagging behind leaders like Japan (137) and the UK (68), they will begin to catch-up, with new consultation groups in both countries and the Bank of China joining the TNFD Taskforce. The US (19) will continue to lag due to shifting political winds.
At the end of 2024, three companies - Kering, GSK, and Holicm - became the first to publicly adopt SBTN (Science-Based Targets Network) targets on either Freshwater or Land. SBTN’s method is the gold-standard for nature targets, and as a result is rigorous, but very demanding. Expect many companies who are not yet ready to commit to SBTN targets to nevertheless begin using parts of their guidance and to set interim targets that don’t yet meet the high thresholds of SBTN. They will then evolve and progress to SBTN targets over the course of several years. The share of the Fortune 500 with biodiversity targets doubled from 6% to 12% in 2024, and this trend will continue
3) Three major UN events on Biodiversity, Plastics, and Climate will send firm policy signals on nature - one way or the other
There were four major UN negotiations in the final quarter of 2024 and each reached inadequate conclusions. The Biodiversity COP16 in Colombia created an innovative fund to share the benefits of Digital Sequence Information (DSI) and provided Indigenous communities with a permanent voice at future conferences. And there was unprecedented presence and momentum from businesses, with over 3,000 in attendance. But these wins were overshadowed by an inability to reach an agreement on nature finance or a monitoring framework, and nearly 80% of countries failed to submit a NBSAP (National Biodiversity Strategy and Action Plan). The Climate COP29 in Baku and the Desertification 16 in Riyadh also reached inadequate agreements on nature finance, and the Plastics Treaty Negotiations in Busan failed to reach an agreement.
2025 will provide another chance for both the Biodiversity and Plastics Treaty. The Biodiversity COP16 discussions will reconvene in Rome from February 25-27. Look out for more countries submitting NBSAPs - a key indicator of future policies - over 2025 and the level of ambition of the finance pledges and monitoring framework that emerge from Rome. The Plastics Treaty will also reconvene at some point during the year.
In addition, Climate COP30 will convene in the Amazon in Belém, Brazil. It will emphasise nature and biodiversity and their interactions with the climate crisis, as Brazil aims to unify the three Rio Conventions on biodiversity, desertification and climate change. Under President Lula’s leadership, deforestation rates in the Amazon are their lowest since 2015 and combatting climate change was one of the top priorities he highlighted as Brazil hosted the G20 in 2024. COP30 marks 10 years since the adoption of the Paris Agreement and before then, all parties must submit new Nationally Determined Contribution (NDCs).
4) Increased consensus on nature metrics for business, driven by the Nature Positive Initiative, will accelerate action
TNFD, CSRD, and SBTN have transformed corporate nature management by providing clear guidance for businesses. But there remains a lack of consensus on the best metrics for companies to use to assess the biotic State of Nature in their locations.
The Nature Positive Initiative's State of Nature Metrics guidance will help foster this consensus in 2025, removing any sense of metric paralysis for businesses and enabling them to focus on action. It is essential reading for any corporate nature manager.
The initial consultation specified the following four Universal Indicators that a company should track: Ecosystem extent, Ecosystem condition, Landscape intactness, and Species extinction risk. It also provides three maturity tiers for each indicator (entry-level, standard, and advanced) and a shortlist of metrics for each indicator. Nala’s platform includes shortlisted metrics on all four Universal Indicators.
Want to learn more?
Get in touch with our CEO Nick (nick.zumbuhl@nala.earth) or CCO Yoni (yoni.pasternak@nala.earth) to discuss how these trends will impact your business and how Nala can support you with nature risk, reporting, and regulations.
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