By Simon Jessop

LONDON (Reuters) – HSBC, BlackRock (NYSE:) and Swiss Re (OTC:) are among the companies seeking to create a risk management and disclosure framework aimed at moving capital away from activities that damage nature.

To combat nature loss which, it claims, poses a serious risk for financial and corporate stability, the Taskforce on Nature related Financial Disclosures was created in June. On Thursday, it stated that 35 top executives of up to 35 businesses would be working together to draft the framework. It will launch early in 2022.

The TNFD is voluntary. It will follow the lead of Taskforce on Climate-Related Financial disclosures (TCFD), which was championed and increasingly made mandatory by Mark Carney, United Nations climate envoy.

The TCFD mandates companies to inform the public about climate-related risks, including the effects of rising sea level on a factory close to the coast. Many of these are related to nature. But the TNFD goes further.

The potential impact on a company’s share price from nature-related concerns include deforestation, water shortfalls and the possible hit to food producers in the event that declining bee numbers affect the pollination.

Alongside the other Taskforce members, which also include Nestle, Citi and Holcim (SIX:), a further 200 institutions have expressed interest in joining the TNFD Forum, which will assist the work of the Taskforce.

Elizabeth Mrema, TNFD co-chairs, and David Craig stated in a statement that “the race between the financial and business worlds towards net zero emissions won’t succeed if both race as fast toward nature-positivity.”

Every Taskforce member will be involved in one of the five groups that will focus on nature-related risk definition, assessment, metrics and measurement, beta testing, and pilot testing.

Herry Cho (Head of Sustainability and Sustainable Finance at Singapore Exchange:), explained that although the financial reasoning for managing natural-related risks has become more apparent, it is still difficult for practitioners to recognize and take action on those risks.