Biodiversity | ~ 4 min read

Plastic fantastic?

The removal of plastic pollution features in new guidance for companies on nature-related risk management and disclosures. Can these recommendations help tackle the problem of plastic?

The Taskforce on Nature-related Financial Disclosures (TNFD) Recommendations, published in September, focus on the relationship between nature, business and financial capital. Plastic pollution was a late-stage addition to this publication, after two years of extensive development and pilot testing with over 200 companies and financial institutions.

How significant is this?

These recommendations align with the Global Biodiversity Framework agreed at COP 151, and we see them as offering valuable insights for asset managers seeking to incorporate nature-related risks into their strategies.

Significantly, the TNFD publication integrates with international financial reporting standards. These include the International Financial Reporting Standards, the global sustainability standards of the International Sustainability Standards Board, and the impact materiality approach used by the Global Reporting Initiative. We welcome this necessary consistency and comparability in disclosure practices. It should aid in providing a clear, coherent framework for companies to communicate nature-related risks and opportunities to investors and stakeholders.

How will this tackle plastic pollution?

The introduction of plastic disclosures stands out in providing companies with guidance and a metric to identify plastic pollution. It also encourages firms to disclose their “plastic footprint” – measured by the total weight of used or sold plastics (polymers, durable goods, and packaging) – broken down by raw material content.

The TNFD also recommends that disclosure of plastic packaging should specify the percentage of plastic that is reusable, compostable, technically recyclable, and recyclable in practice and at scale. This aligns with targets 7 and 11 of the Global Biodiversity Framework focused on services provided by ecosystems.

Why is it useful?

The alignment with global standards and the introduction of plastics disclosures will be particularly useful. More broadly, these recommendations contribute to the evolution of nature-related risk management and disclosures, equipping asset managers with the valuable tools to navigate the complex landscape of environmental risks.

See our latest insight paper on biodiversity: Defining the rules of engagement to protect biodiversity

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