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.
There is ample academic research showing that diverse leadership teams make better business decisions. While the benefits are clear, we still see significant room for improvement on this issue at the executive level and below, particularly in Germany.
According to the World Economic Forum, more than half of the world’s GDP depends on nature and its ecosystem services and is therefore exposed to nature loss. Investors have an opportunity to lead the transition towards a nature-positive system to halt the loss of biodiversity and preserve ecosystem services. What role are we playing?
Investing involves risk. The value of an investment and the income from it will fluctuate and investors may not get back the principal invested. Past performance is not indicative of future performance. This is a marketing communication. It is for informational purposes only. This document does not constitute investment advice or a recommendation to buy, sell or hold any security and shall not be deemed an offer to sell or a solicitation of an offer to buy any security.
The views and opinions expressed herein, which are subject to change without notice, are those of the issuer or its affiliated companies at the time of publication. Certain data used are derived from various sources believed to be reliable, but the accuracy or completeness of the data is not guaranteed and no liability is assumed for any direct or consequential losses arising from their use. The duplication, publication, extraction or transmission of the contents, irrespective of the form, is not permitted. This material has not been reviewed by any regulatory authorities. In mainland China, it is for Qualified Domestic Institutional Investors scheme pursuant to applicable rules and regulations and is for information purpose only. This document does not constitute a public offer by virtue of Act Number 26.831 of the Argentine Republic and General Resolution No. 622/2013 of the NSC. This communication's sole purpose is to inform and does not under any circumstance constitute promotion or publicity of Allianz Global Investors products and/or services in Colombia or to Colombian residents pursuant to part 4 of Decree 2555 of 2010. This communication does not in any way aim to directly or indirectly initiate the purchase of a product or the provision of a service offered by Allianz Global Investors. Via reception of this document, each resident in Colombia acknowledges and accepts to have contacted Allianz Global Investors via their own initiative and that the communication under no circumstances does not arise from any promotional or marketing activities carried out by Allianz Global Investors. Colombian residents accept that accessing any type of social network page of Allianz Global Investors is done under their own responsibility and initiative and are aware that they may access specific information on the products and services of Allianz Global Investors. This communication is strictly private and confidential and may not be reproduced, except for the case of explicit permission by Allianz Global Investors. This communication does not constitute a public offer of securities in Colombia pursuant to the public offer regulation set forth in Decree 2555 of 2010. This communication and the information provided herein should not be considered a solicitation or an offer by Allianz Global Investors or its affiliates to provide any financial products in Brazil, Panama, Peru, and Uruguay. In Australia, this material is presented by Allianz Global Investors Asia Pacific Limited (“AllianzGI AP”) and is intended for the use of investment consultants and other institutional /professional investors only, and is not directed to the public or individual retail investors. AllianzGI AP is not licensed to provide financial services to retail clients in Australia. AllianzGI AP is exempt from the requirement to hold an Australian Foreign Financial Service License under the Corporations Act 2001 (Cth) pursuant to ASIC Class Order (CO 03/1103) with respect to the provision of financial services to wholesale clients only. AllianzGI AP is licensed and regulated by Hong Kong Securities and Futures Commission under Hong Kong laws, which differ from Australian laws.
This document is being distributed by the following Allianz Global Investors companies: Allianz Global Investors GmbH, an investment company in Germany, authorized by the German Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin); Allianz Global Investors (Schweiz) AG; Allianz Global Investors UK Limited, authorized and regulated by the Financial Conduct Authority; in HK, by Allianz Global Investors Asia Pacific Ltd., licensed by the Hong Kong Securities and Futures Commission; in Singapore, by Allianz Global Investors Singapore Ltd., regulated by the Monetary Authority of Singapore [Company Registration No. 199907169Z]; in Japan, by Allianz Global Investors Japan Co., Ltd., registered in Japan as a Financial Instruments Business Operator [Registered No. The Director of Kanto Local Finance Bureau (Financial Instruments Business Operator), No. 424], Member of Japan Investment Advisers Association, the Investment Trust Association, Japan and Type II Financial Instruments Firms Association; in Taiwan, by Allianz Global Investors Taiwan Ltd., licensed by Financial Supervisory Commission in Taiwan; and in Indonesia, by PT. Allianz Global Investors Asset Management Indonesia licensed by Indonesia Financial Services Authority (OJK).