How can we establish which companies are merely profiting from nature and which are taking action to try to preserve a healthy and robust environment for future generations? This is the main goal of the international Task Force on Nature-related Financial Disclosures (TNFD), which provides a methodological framework for companies to assess the environmental impact of their activities and to quantify the value of a healthy and functioning environment to their business. CEZ Group is among the companies that have committed to prepare an analysis according to the TNFD guidelines as early as 2024.
“We keep a close eye on the latest sustainability trends and try to incorporate them into our activities well in advance of them becoming mandatory. The topic of biodiversity conservation appeared more and more often at international forums last year, so we expected an effort to professionally address it at global level. We are pleased to be among the first companies to commit to mapping their impact on nature and biodiversity, and to subsequently prepare a programme to protect and restore them,” said Michaela Chaloupková, member of the Board of Directors and CEZ Group Chief Sustainability Officer.
The TNFD published the first version of the methodology in 2022 and, after incorporating comments from public consultation processes, presented the final version at the end of last year. The aim of this single, standardised framework methodology is to enable investors, financial institutions, suppliers, consumers and all stakeholders to compare the activities of individual companies not only in terms of climate protection but also in relation to other nature-related topics such as biodiversity, ecosystem resilience, etc. An emphasis on the local in environmental risk assessment and the huge scale and diversity of human activities affecting nature are two of the main differences compared to assessing the impact of corporate activities on climate change.
To illustrate, CEZ should, for example, consider in its analysis whether its planned construction of almost 6 GW of photovoltaic power plants could reduce biodiversity at the sites and, if necessary, describe how they will ensure that this does not happen.
Nature and biodiversity are very closely linked to the climate. In fact, they are two sides of the same coin, with climate defining the basic conditions for ecosystems. While the economic risks associated with climate change have been measured, analysed and quantified for many years, the risks associated with biodiversity loss are only just now gradually coming into focus, including with regard to the impacts of climate change.
At the United Nations Biodiversity Conference in December 2022, nearly 200 governments from around the world, including Czechia, committed to an ambitious set of goals through 2030 to halt and reverse nature loss. The adopted Kunming-Montreal Global Biodiversity Framework, sometimes called the Paris Agreement for Nature, includes, for example, a requirement that 30% of terrestrial and 30% of marine areas with the best preserved ecosystems be protected by 2030, or that at least 30% of degraded ecosystems be restored and protected.
A January 2020 World Economic Forum report estimates that more than half of global economic output is at least moderately dependent on nature. It is therefore essential that companies systematically pay attention to nature conservation and restoration.