The past decade has seen huge progress in the way companies analyse their exposure to carbon emissions, but far less effort has been put into understanding the complex interactions companies have with nature.

If we’re to have a hope of reaching net-zero, we need to reverse the trends of biodiversity loss and incentivise companies to assess the risks and opportunities around natural-capital

On this episode we have the perfect guest to discuss this topic; Tony Goldner, he’s the Executive Director of the TNFD, the Taskforce on Nature-related Financial Disclosures, an organisation that was established to try and solve this very problem. 

The big news is that this week Tony and his team have published the final version of the TNFD Recommendations. It’s a framework that will give companies and investors alike a clear and uniform model for putting nature, on the balance sheet.

Tony’s worked at the helm of the TNFD since it was founded two years ago. He’s originally from Australia, he now lives and works in Europe, and he’s had a fascinating career that spans foreign affairs with DFAT, he’s worked in global finance, he’s been a consultant, and now he’s pulling it all together to convene a mix of stakeholders across the globe and across industries. 

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On this episode…

It really was a thrill to speak to Tony on such a big week for the TNFD, the recommendations have only been live for a few days, and so in this conversation I did my best to offer a broad overview of the final recommendations, and practical actions to help us integrate them.  

He explained the high-level problem the TNFD is trying to solve (the ‘why’), but we also dug into the more practical problems and opportunities that companies will face in engaging with the framework, and understanding their dependencies on nature.

The concept of ‘dependencies’ is an interesting one, and we went deep into the nuance about why analysing nature impacts is very different to measuring carbon emissions. 

My key takeaway this week…

“It’s increasingly clear to governments to business and finance that we won’t get to net zero if we’re not also nature positive.”

Series Sponsor – GreenCollar

This is the second in a series of episodes exploring the concept of ‘natural capital’, and to get us there, we have the support of a new Good Future sponsor, GreenCollar

GreenCollar is a developer and innovator of environmental market solutions, they recognise the power of putting a financial value on nature, as an incentive to drive sustainable land management, cleaning up our waterways and avoiding further loss of biodiversity and animal species.

Since launching more than a decade ago, the company has become Australia’s largest developer of nature-based carbon credit projects, and they’re pushing the market forward with schemes like ‘Reef Credits’, which target improved water quality at The Great Barrier Reef.

And their latest innovation is NaturePlus, a new form of biodiversity credits that aim to protect and restore ecosystems around the world. They’re measuring biodiversity outcomes on the ground, with a scientifically rigorous and verifiable methodology, that puts a value on natural capital, to enable investment in the conservation of high value ecosystems.

Reach out to the team at to find out more. 

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Full Transcript

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John Treadgold 

Tony, great to have you on the podcast. Thanks for giving us some time in what I’m sure is a very busy week for you.

Tony Goldner 

Yeah. Thanks, John, great to be with you. All right.

John Treadgold 

Well, look, we’re here to talk about the TNFD, the Task Force for Nature-related Financial Disclosures, we’re going to try and cover this new framework from all angles. But to get started, what’s the core problem that this task force this framework is trying to solve?

Tony Goldner 

Well, I think there are two two key challenges at the moment one, we can’t keep treating nature as an endless provider of free resources into a business and society, which is what we’ve been doing for hundreds of years. It accelerated with the Industrial Revolution. It’s accelerating with globalisation in the last few decades. And it’s quite clear from the science that nature is at or beyond its limits, and its ability to keep providing us with what we asked of it. We’ve now breached six of the nine planetary boundaries, we’re seeing the consequences in terms of a more frequent and more severe natural disasters, we tend to think that we can, we can just rebuild and get through these problems, but the costs are mounting to economies to society, to individual businesses to families.

One just needs to think about the scale of what we’ve seen in Hawaii, as a recent example, what Australians have lived through in the bushfires of 2019/20. These things are happening more frequently, they’re happening with greater severity, the insurance costs are going up, which means the insurance premiums are going up, and that that’s flowing through our economies. So we have to get to a better relationship with nature, in a way that maintains its ability to support our prosperity, because we are 100% dependent on nature. At the end of the day, there is nothing else if there’s no sustainable planet, there’s no no no people, no profits, no pensions. So that’s the first problem.

I think the second problem more tactically, is, at the moment, we’ve been very focused on talking about all this as climate change, we tend to bucket everything under the label of climate change. But in the science, climate change is just one of the five big drivers of nature loss, there are four other drivers: and we’ve largely given them very little attention, because we’ve been so focused on one of the five. The others are: resource use, pollution, land-use change, and invasive species.

And we need to start taking a much more integrated approach because of course, Nature doesn’t put things into buckets, the way we do to make sense of things. They’re all connected in one planetary system. So I think those are the two issues, we have to act with urgency, we need a new relationship with nature. And we need to be thinking beyond just climate change.

John Treadgold 

Alright, big problems there. And we now have this tool, this very specific tool, a set of recommendations. It’s very much focused on companies, this business level, it’s not about philanthropy, it’s not about it is about conservation. But it’s really looking at the way our economy consumes and in some, in a lot of ways, as you explained, exploits nature. And so in that way, covers companies and then and then the investors themselves, and they absorb the data that come from the companies.

But why now? I mean, surely companies are good at looking at risk to them, you know, they’re going to be looking forward, they’re going to understand certain risk factors that are material to them. Why do we need this extra layer of analysis?

Tony Goldner 

I think a few things are becoming increasingly clear. While we’re all very focused on getting to net zero, through tackling climate change. I think it’s increasingly clear to governments to business and finance that we won’t get to net zero if we’re not also nature positive, that nature is a key part of our ability to actually get to net zero.

There’s currently no set of technology, man-made or anthropogenic technology solutions, which will get us to net zero without using the natural world around us as our key ally in that fight against climate change.

So as we’ve embarked on these ambitious global goals around climate change, we need to mobilise nature. And so I think that’s changed the conversation around well, how do we need to be thinking about nature differently to help us get where we want to go on climate change.

Number two central banks around the world increasingly now recognise nature as a source of risk in the same way that they have identified climate change as a source of risk to our economies to our financial systems. Just last week, the incoming Governor of the Reserve Bank of Australia pointed to climate change as something that could potentially disrupt markets, financial markets. We’ve had the global network of central banks called the Network for Greening the Financial System published a paper last year, pointing out nature and biodiversity as a source of systemic risk to financial systems. So regulators are paying more attention.

And the third dynamic is that investors They’re now paying more attention because institutional investors who invest for the long term across sectors and across asset classes, they are increasingly realising that they have nature risk on their balance sheet and in their investment portfolio. And they need to manage that risk.

And so investors are starting to ask more questions of the companies they invest in. And that’s really the purpose of TNFD, which is to put forward a set of recommendations about information that should be disclosed through standard corporate reporting practice, so investors can make better, better risk management and better capital allocation decisions. So that’s what we’re trying to contribute to. But I think there’s this interesting collection of forces that are happening around this topic. Consumer expectations are changing, costs are going up, governments are paying attention. And investors are asking more question, I think that’s why this is gathering so much momentum at the moment,

John Treadgold 

gathering momentum. Indeed, it’s a big week, the final report has just dropped after four drafts, I think it was all sorts of consultation and discussion. It’s finally here, what are some of the key points that you think will will spark interest this week?

Tony Goldner 

Well, I think we’ve had a huge amount of market engagement. So one of the benefits of that was we just set out very much with the appreciation that we needed to crowd-in market experience, if we were going to have a shot at coming up with something that struck the right balance between the complexity of science on the one hand, and the need for something practical and market participants on the other.

So we’ve had huge market engagement. 1000s of people across markets around the world have contributed through pilot testing through feedback in focus groups, we’ve really run quite a unique process to develop something like this. And so there’s a lot of anticipation and expectation people who have contributed and are looking forward to seeing the final recommendations, and they’re now out.

And we’re already seeing companies starting to step forward and signal that they’re going to start adopting the recommendations in their next reporting cycle, which is hugely exciting. And, of course, that’s exactly what we want to see happen.

So I think I think there’s going to be a few things that happen in the next 12 to 18 months one we’re going to see currently start adopting the TNFD recommendations. Two, I think we need to address market knowledge and capability building needs. And that’s going to be the next big focus for our work at the Taskforce. We’re going to shift gears now from designing the framework, which is down to working with a range of partner organisations on programmes and platforms that can help to build knowledge and capability around nature-related risk. Because we recognise this is completely new for most businesses and most financial institutions.

And I think the third thing we’re going to see is probably growing interest from regulators. A lot of them are moving now on climate, we’ve held the New International Sustainability Standards Board, global baseline standards come out. We’ve aligned and tried to be as consistent with those as we can to speed up adoption, it’ll make sure that there’s consistency, conscious of the cost of all of these things to come in terms of compliance. So that’s in place.

So I think with the with the baseline, the sustainability reporting baseline out there, and TNFD out, I think we’re going to see a growing interest from regulators in what this looks like over the next three to four years. And it’s worth bearing in mind that 190 countries signed on to the global biodiversity framework in Montreal last year, this is the sort of nature-equivalent of the Paris agreement. And in that agreement is target 15, and target 15 calls for the reporting of impacts, dependencies and risks, which is exactly what TNFD is now tooled-up to do. So there is a policy ambition, governments have indicated that they want to move towards corporate reporting on nature-related issues. And now the tools are available. So we’re going to see growing government and regulatory interest in the next 12 to 18 months.

John Treadgold 

Okay. And in that process, over the past 12 months, people have been talking about the TNFD, this is them this is not they are recommendations, your recommendations to voluntary framework, I can only imagine that there would have been heated discussions, you finally come up with the final document. Were there any changes? What were some of those last minute tweaks or key points that are of interest?

Tony Goldner 

Well, I think the probably the most important thing we did was we had the benefit of the ISSB global baseline standards that were released in June. So we’ve worked very hard to align with the language of the ISSB standard. As much as possible, of course, our original reference point was TCFD. In the last few months of our work, TCFD announced that it was closing down that it was mission accomplished had sort of achieved its objectives, and that that work was going to be carried forward by the ISSB.

So of course as we look ahead to the future, it’s the language of the ISSB and the standards that are going to shape corporate behaviour and reporting expectations. So the biggest thing we’ve had to do is stay true to the TCFD approach and the consistency with what they had developed, but start to adapt the language for the new ISSB standards that have come into play.

So that was probably the most consequential and important thing we’ve done.

And I think we feel we feel that while what we’ve come out with is very consistent with the ISSB global baseline, which is great. I think the other thing we spend a lot of time on is just refining, based on feedback from the market, our approach to metrics. What is it that’s going to be measured? What are the metrics that sit into the heart of the framework? That has been it has been a hugely complicated part of our work over the past two years. And when we started out, we identified something like 3,000 different metrics already in use around the topic of nature and biodiversity. So that’s clearly an impossible suite of things for business use. And so we’ve taken a leading indicators approach, and we have a lot of feedback in the last few months of the consultation process around whether we’ve got the balance right, additional metrics that needed to be considered etc.

So I think the two big things are consistency with the ISSB new standards, and further refinement of the metrics were the two big challenges.

John Treadgold 

That’s it metrics is a huge issue. I’m really keen to dive into that. But before we get there, I’d love to get really clear on some some terminology. That’s my focus often is this impact approach. And then looking at it from a communications perspective. You talked about TCFD subsumed into ISSB and TNFD following along there. But a key shift or addition is this double materiality approach, looking at not only risks to companies, but impacts to nature? So can you talk to us about how you’ve dealt with that?

Tony Goldner 

This has been a recurring issue, but certainly lots of people with strong views. And what was interesting about this over the last two years is that I think a lot of people started out with an expectation that the TNFD will have to pick one approach or the other approach, we will either have to be for single materiality or for double materiality.

And for us, it’s not really our role to determine the materiality of companies that are reporting that’s for the companies to decide. And they do that based on a few things. They do that based on their own vision and values. Some companies think it’s important to report on their impacts whether they have a regulated requirement to do so or not. So vision and values is one factor.

The second factor is the expectations of their investors. Every company has to be responsive to the information needs of the people providing them with capital. And the investors are asking more questions. And so that’s a big driver of materiality considerations. And the third factor, obviously, is whatever jurisdiction and regulatory reporting requirements you have.

So it’s not really TNFD’s role to be prescriptive saying it should be one way or the other. But the reality today is because of the path that Europe has gone down with its new reporting standards, they have embraced, in black and white law, a double materiality approach.

So from our perspective, we had to accommodate different approaches to materiality around the world. So the way we’ve handled that is, quite simply that we’re not picking one or the other, we’re enabling report preparers to use their own materiality approach with the TNFD guidance and tools that we’ve put forward. So, for us, it was about coming out with a set of recommendations and an approach that enabled their choices and their needs rather than us prescribing one approach as opposed to another.

So I think we’ve done that, as I said, we’ve worked closely with the ISSB to make sure it’s consistent with the global baseline. We’ve also been working closely with GRI, who provide the world’s impact standards with 1000s of countries around the world using the GRI impact standards. And also with FRAG, the entity of the European Union that was designing the European approach. We’ve been talking with all of them for the last 18 months as we’ve designed our recommendations. And we’re very confident that what we’ve come out with works in both directions. And so it’s up to companies to decide what they need, and take from our framework, what’s required to do their reporting.

John Treadgold 

You’re being very diplomatic there. I mean, these are recommendations, you have your management and you’re saying this is this is the way to drive those outcomes. And as you talk through those really big chunky problems up front of too many businesses not recognising the limited stock of nature, biodiversity loss is opening the world to huge risks from businesses off to the very air and water we depend on. And these words risk, impact, dependency. They get bandied around a lot businesses more and more in Australia, especially really aware of greenwashing. So how have you dealt with defining these terms, risk and impact?

Tony Goldner 

Yeah, so we’re very clear that in order to understand your risks and opportunities to the company, you have to understand your impacts and dependencies on nature and we use those words very intentionally and only in one direction. Sometimes people refer to risks to the business or risks to nature, that can be confusing, or they also talk about impacts on nature and impacts on the business.

So in the TNFD guidance, we’re very clear we use impacts to mean impacts on nature and risks to mean risks to the business. And the absolute sort of bedrock of the TNFD approach is that you can’t understand your risks and opportunities if you haven’t understood your impacts and your dependencies. So whether or not you’re disclosing information in both directions, that’s a separate question. But from an assessment perspective, what you need to be doing internally in your company, to understand your nature related issues, you have to understand your impacts and dependencies in order to understand your risks and opportunities.

So you’ve got to work through this process across those four, those four key building blocks that the analytic process impacts dependencies, risks and opportunities. And we provide a set of guidance on how organisations can do that in a fairly structured way. And we link up to tools that can help them to do that, to datasets where they can find data, that’s helpful. So we’re very conscious that this is a new topic. It’s a new assessment approach. It can feel quite complex. But somebody said to me the other day nature is complex, but it doesn’t have to be complicated. And so what we’re trying to do is provide a set of guidance, which takes the beautiful complexity of nature and makes it accessible to business and finance and provide them with tools to go through a sort of stepwise assessment process so they can figure out what’s relevant and potentially material to them. And I hope that’s what we’ve achieved.

John Treadgold 

That’s it. I think that that complexity piece really does tie into metrics, because of course, whenever you’re using any metrics and trying to categorise things in groups can have that breadth and have lots of them. And as he said, he started with 3000 odd, far too many. But that that does offer the specificity needed you think, got to pull that back to make it usable, and comparable.

I think, you know, a key, a key concept that seems I mean, the world, my listeners understand ESG, they understand carbon risk, we’ve all spent a decade trying to measure our emissions. But this idea of dependencies, I think, is a really interesting one. And while there’s a free rider benefit from polluting and not worrying about it, when others are trying to be leaders and reduce it. I think this dependency on nature is an interesting one, because there may be companies that face a risk, because the freshwater or the pollination from the bees, or the quality of the soil has just been something they’ve depended on. But now their investors are saying, hang on, we want you to start putting some data behind this, we want to understand those dependencies. So it is quite a different paradigm. How does that play into metrics? And how is that I guess swayed what you’ve recommended? Yeah.

Tony Goldner 

So I think you’re right, John, with the big new word in in the nature risk assessments basis dependencies. We haven’t been using it in the climate context. But it’s absolutely central dependencies is the pathway to risk to the enterprise. And so it’s really important to go back and basically start I think every company should be if they take one thing away from the launch of a TNFD this week, I would encourage every business executive who’s heard about the TNFD to go back into your organisation and just ask your team one question, how are we dependent on nature?

And that one question will then trigger literally should trigger a whole series of questions, some useful analysis and some pretty revealing insights around potential sources of risk, but frankly, most businesses are not identifying today.

And in terms of the metrics, what’s important is that you have to go back and think about what is it that nature is producing that provides a flow of benefits into our business. And in the science, that flow of benefits is called ecosystem services. And there’s actually a nice taxonomy of ecosystem services, there’s about 25 of them, so they’re identified. That means we can address them and analyse them one by one and say, what’s relevant to my business? What kind of data and metrics do I need to be gathering to do an assessment. And we lay all of that out in our in our guidance.

But the key thing is understanding that matches assets, its rivers, its forests, you know, the soil, they produce a flow of benefits into business, the provision of fresh water, bees who planted our agricultural crops, a supply of biomass, the wood that we use for furniture and paper and everything else. This is the flow of benefits that come into our business processes. And so business needs to understand what are they that we were taking for granted, we’re usually not pricing them appropriately at the moment. Some of them indeed are free. Even the supply of good clean air in inner city areas, we’ve seen what happens in places like Singapore and China and other parts surveys are where there’s terrible smog. And people end up having to stay at home. Because they can’t get to work because it’s unhealthy to go outside that impacts on the productivity of a business.

Similarly, beverage companies are completely dependent on nature’s ability to provide them with a supply of water. So they are spending a lot of time looking at water quality and the resilience of a particular watershed to restore that level of water and its ability to provide that flow, year in year out.

So we outline how you can go about thinking about ecosystem services. And we provide a set of metrics around that. Now the real complication comes in where, in order to do that well, you obviously have to have an understanding of what’s the state of nature in a particular location where I draw that flow of benefits from, and the science around state-of-nature is still evolving, and so is the metrics. And so I think this is really the piece that we’re going to be spending a bit more time on in the next year or two with science organisations, is how can we make it easier for business and finance to understand the state-of-nature in a particular location where they have a dependency, because without that reference point, you don’t know whether you’re withdrawing too much water today, and maybe amplifying your risk tomorrow. So there’s definitely work to be done. But none of that should stop people from starting to ask that question and do the analysis internally. It just means you have to be thoughtful and creative about working around some of the data constraints to form a view. Even if it’s a qualitative view, that’s better than not having any view at all. Because at least you’re aware of things you have to keep monitoring as the data improves over time.

John Treadgold 

Yeah, I think that that state of nature piece is very interesting. And that really does speak to that complexity challenge. And I mean, measuring that alone, right. It’s been hard enough to drive up the skill set to measure emissions. But now we’re being asked to understand the state of nature, far broader. What has been the feedback, perhaps our recommendations, what sort of the 5-10 year plan for guiding organisations to think about resource allocation that training, we’re going to need a lot more environmental scientists? What’s your sort of vision there?

Tony Goldner 

Yeah, so Well, there’s lots of people working on this problem. And there’s a lot of very exciting innovation, we’ve got a number of groups trying to develop metrics, sort of aggregated metrics for the state of nature, groups in Australia, like Accounting For Nature groups in France developing things like main species abundance, there’s another one ecosystem integrity index.

So there are lots of sort of indices and new metrics and measurement approaches that are emerging. We’re excited to see all of that we signpost to them, we don’t pick one over the other because as TNFD, we want to encourage further innovation and development in this space. So that might make it sub six, and significantly easier in the future for business and finance to get some sort of reference reference number or reference level. So the state of nature in a particular area where they’ve identified they have impacts and dependencies.

So that’s happening. I think, in parallel, we have worked with a number of partners on an initiative to consider a case for a global nature related data facilities. So this would be a sort of platform, which would provide lots of users, governments, business, finance, civil society, with better access, more timely access, and better open access to nature related data, because one thing we’re going to see is an explosion of interest in natural entered data and demand for high quality data. And one of the central challenges we have at the moment, is that there’s actually a lot of nature related data, it’s a bit of a misperception to say there’s no data, we can’t do the analysis, there’s actually huge amounts of nature data out there. It’s just it’s not easy for new new participants in this space, most of the business of Finance to know where the data is and how to access it. But a lot of it is squirrelled away in academic institutions, it has to go through a two or three year peer review process before it’s released. But of course, for market participants three or four year old data is not that helpful. So we have to change the whole nature data paradigm, the way it’s collected, the way it’s made accessible, because we’re now trying to inform decisions that happen in a much faster time cycle than scientific research or government, even government policymaking. And so that’s a really big challenge going forward. And that’s something we’ve committed to working on with a number of partners to see if we can make a contribution to that challenge. But it’s a huge challenge. It’s not going to be easy, but we think there’s a case for a global data facility to provide better access into the data that’s already available today.

John Treadgold 

That’s some really, really great practical advice there. Tony looking forward, you know, the data needs this already a whole slew of of new startups that are building new tech exciting companies on the way that then and I think look, it’s such a positive outcome, there’s been so much energy behind this, we finally have investors and businesses becoming environmentalists and conservationists. And these worlds are colliding, it’s exciting, but to again, zero in and maybe rather than looking five years ahead, thinking this week talking to those hedge of sustainability out there that might be hiding under their desks as they know this another framework they have to digest, what advice would you give them in terms of what to do this week? And how to think about this new frontier?

Tony Goldner 

Well, I’d say if you’re completely new to nature, have a look at the report we’ve released. And just start at the baseline, we’ve got a fantastic section in our recommendations report about the foundations of nature and how business, people in business and finance can understand nature as a topic that they need to start considering. It’s all based on a natural capital approach. So thinking about nature is a set of assets that provide the type of services that we talked about a few minutes ago. And that’s language that people in business and finance understand, right, we understand assets and services and flows and stocks. And that’s the language in which we, and many other organisations, are explaining and articulating how business can make sense of the complexity of nature. So I think the language has improved a lot in the last few years. And I think it’s, it’s interesting, it’s accessible, and so I would, I would really encourage people to start there.

And then, you know, for those who are interested in going to the next stage, there’s always the opportunity to join the TNFD Forum, which is a sort of broad institutional community, we now have 1200 institutions globally from about 50 countries that have signed up to support our work. We do webinars, we have newsletters, we’re going to be offering more training modules and training content in the next six to 12 months. So joining the TNFD Forum is a great way for someone in a CSO’s team to sign up and start socialising content internally within their colleagues. And we will continue to do what we can to provide that. We also connect up to lots of great content provided by other organisations.

So I think it’s really just a matter of starting that inquiry process with that very basic question that I mentioned before. How are we dependent on nature? That one question is really the door opener, and you’ll find on our website, and lots of other sources out there, some pretty good accessible material just to get into the conversation to start learning the basics. And then I think it’s about building from there.

And maybe that leads to pilot testing our assessment process, which we recommend, we’ve had amazing feedback from the 200 Plus organisations that have done a pilot test in for many of them, it’s really reframed to the relative importance of nature risk versus climate risk. Of course, everyone’s been very focused on climate risk, until you know what else you have to be looking at, you don’t know how it fits in the relative scale of your risk register. But we’ve had some of the world’s biggest consumer goods companies telling us, wow, we just did a LEAP assessment, and we now realise we’ve done some order of magnitude quantification of the risks that we identified, and it’s coming out higher than our climate risk. So it’s changing the way we think about wherever there’s got to be spending our time. And you mentioned, quite rightly, John, everyone’s got capacity constraints they’ve got budget constraints, there’s a million other things to do. But we can’t escape from the reality that nature risk is on balance sheets, in cash flows, and in investment portfolios today, which means those risks of being unattended to, until we get the tools in place, and people start exploring and looking at it and then taking action.

So it’s really about prudent risk management, in many ways. It’s no different than responding to say cyber risk or any other type of risk. We’ve seen business spend millions of dollars on cyber risk in the last 10 years, we need to think about nature risk in the same way. So I’d say start reading get started, join the 10 ft forum and maybe consider a pilot test with the framework.

John Treadgold 

And of course, he mentioned LEAP that stands for locate, evaluate, assess, and prepare.

Tony Goldner 

That’s our assessment approach that’s been pilot tested about 200 times. And as the acronym suggests, it starts with understanding where your business is interfacing with nature, what’s Where’s where’s, where are those things located? It could be in a sector portfolio for a big institutional investor, or it could be in a geographic location, either with respect to a company’s direct operations, or along its supply chains. But it all starts with locating where you’ve got nature risk associated with your business. And then, in many respects, the rest of the assessment process is quite similar to what companies would be doing today on other risks.

John Treadgold 

Well, that’s right. And of course, the risks and opportunities exist, whether you evaluate them or not, right, they’re gonna catch up with you eventually. The opportunity to see yours for the taking. Yeah.

Tony Goldner 

And we haven’t talked much about the opportunity side of the equation, we’re definitely seeing a lot of companies are showing interest in TNFD are doing so not because they’re sort of thinking, Oh, here’s another compliance exercise that I have to get ready for I better start learning, they’re actually coming to us from the opportunity side of the equation.

We’ve got about a $700 billion funding gap annually to address nature loss. And of course, governments can’t provide that funding, the private sector has to come on board to help find the solutions and provide the financial capital. And that means huge opportunity ahead for first movers, for innovators and for people working in structured finance.

And I’ve said previously, I think this is particularly unique opportunity for Australia, given that we’re a mega diverse country, and, and we’ve also got incredible depth of experience around structured finance for things like infrastructure. So if we think about nature as infrastructure, and we start financing it the way we’ve been funding, toll roads, highways and other things important Australia. Australia could really become a world leader in scaling nature-based solutions.

John Treadgold 

And I think

As I think through that, that really does come back to the dependencies piece, right? Because if you just focused on emissions, there’s such a free rider benefit to not doing any work, because there’s so many benefits to not having to pay for your pollution. But with nature, you can’t get away from your dependency, because if you overuse it and exploit it, it’s not going to be there anymore, the soil just won’t keep providing for you.

Tony Goldner

Yeah, that’s right. With emissions, we all share globally, one atmosphere so Australia can keep polluting, but we benefit from less pollution from others or less emissions from others. But nature related issues are localised, as you said, you can’t get away from dependencies and you can’t get away from location. So Australian business, the construct of the Australian economy is incredibly nature dependent. So we’ve got everything to gain by getting onto this agenda quickly and being an early mover and a lot to lose if we’re a laggard on responding to nature loss because Australia’s economy and the prosperity of Australians is so tied to our natural environment.

John Treadgold 

That’s such an important point, all right. And what’s really, I mean, the timelines, fewer excellent. I mean, it’s no surprise when the TNFD was launched, it was March because it was needed. But of course, COP15 in Montreal, you mentioned it earlier, a real watershed moment landmark agreement around the Global Biodiversity Framework. And in the same way that net zero by 2050 was a goal and a term that everybody could grab on to that, we now have this nature-positive ideal trying to protect 30% of nature by 2030. What impact does that agreement have, and just how much interaction did you have with sort of the proceedings?

Tony Goldner 

I think the global biodiversity framework, obviously, is not quite as high profile as Paris, but many people are calling it the Paris equivalent for nature. And certainly I think that’s right. As you said, it sets the set of targets and goals out to 2030. The bad news is that there was a previous set of targets and goals for the preceding 10 years called the Aichi targets. And the world failed to meet almost all of those targets. So we don’t have a great track record of sticking to these commitments.

But 190 governments have committed and I think we’re now in a very different place than we were even a few years ago on understanding nature and nature later this risk issues and the need to take more concerted action. So I’m optimistic that there’s a lot of momentum around this. And we will not obviously directly involved in negotiations, that’s between governments. But we were following proceedings carefully. In fact, one of my co chairs, Elizabeth Moremo, was running the process. She has two hats. She was she was in charge of the convention on biodiversity Secretariat that manage the COP15 process, while also being co-chair of TNFD. So it was an amazing experience to watch her navigate international diplomacy on nature and get the agreement done. But I think now we have it, we’ve got a clear sense of direction. The goalposts are pretty clear now, as they are with climate with through the Paris Agreement. So it’s all about buckling down, getting the work done for business and finance, target 15. It calls for corporate disclosure of the impacts, dependencies and risks and and TFD now provides the tools to do that. So for all those companies out there that wants to be Paris aligned on climate, I think the new term will be Montreal aligned on nature.

And the goals and targets are clear. And TNFD provides the tools to do it. And I think it’s a really empowering statement for business to show that they’re taking action not just on climate aligned with Paris, but also on the rest of nature, aligned with the goals from the Montreal global biodiversity framework.

John Treadgold 

Well, that’s right. I know it’s been it’s been such a big couple of years for you. And I can imagine a big cathartic release this week as you finally push the recommendations out to the world in some some ways it’s an end, right? You’ve accomplished something. But really, it’s the beginning. And if we think about how long ago, two years tcfd was launched and the momentum it takes to engage and really drive those outcomes. What’s the feeling this week? What’s that, that cathartic exhalation, and then the progress and what you’ve accomplished in the last last 18 months? Yeah, I think

Tony Goldner 

we’re just hugely grateful for the level of market support and participation in developing the design of the framework. It’s been it’s been a challenging process, been fascinating for me to coordinate the effort but fascinating and complex task. But we knew from the outset that 40 taskforce members, as individuals did not have all the answers we needed to crowd in the market. So I think this week is very gratifying to see that all of those 1000s of hours of time that have been spent, by people around the world part of their day job contributing to the design of this framework has all come together and received such a positive reaction.

So just a great sense of achievement in that regard. But also for us, this is a moment to pivot as you said, we’re we’ve just got to the end of the beginning. And now the hard work begins of driving voluntary market adoption of helping market participants with the knowledge and their data and the capability challenges that we know are there. We’re very committed to doing everything we can to help close those gaps as quickly as we can. The good news is that TNF D is quite well funded for the next few years, we’ve got a terrific group of partners around us. So we’re just mobilising another coalition now, to take shape and help mobilise knowledge, data and capability building solutions so that we can get more and more businesses and financial institutions on this pathway to nature related disclosures.

John Treadgold 

And Tony getting a bit more personal now what got you to this point to be leading this this ragtag bunch of nature-focused investors and business leaders from Australia originally living in Barcelona now. Can you give us a bit of background of how you find yourself here? And do you wear more the hat of the environmentalist or more of the investor? What’s the where’s the weighting in your background?

Tony Goldner 

Well, I’ve got quite a diverse background from having worked in government on policy issues with the Department of Foreign Affairs in Canberra at the beginning of my career, I then moved into corporate finance. So I sort of have some sense of discounted cash flows and valuation models and things I was working on public private partnerships in Australia, 20 years ago when everyone was talking about toll roads and airports and things like that, which has been a huge source of helpful knowledge in this task. And then I’ve spent the last 15 years or so in management consulting, advising clients around the world on complex challenges at the intersection of government, business, and finance.

So I’ve always ran towards these big complicated, hairy challenges like this, or like orchestrating these multi-sector sort of initiatives. So that, for me was really an interesting challenge in this in this exercise. And I had been doing a lot of work for, I guess, 20 years, all of my career has been focused in one way or the other on development challenges and economics and the intersection of policy and business and finance. But I increasingly started to drift probably four or five years ago towards more of the environmental SDG’s rather than the other SDGs. And so, but just think there’s huge, exciting opportunities to transform the way finance, business and policy interact to solve some of the world’s problems. And this was a great challenge and a great opportunity to contribute. So that’s what drew me into this task, but maybe a bit like a moth to a flame. It’s been a pretty, pretty intense two years. But I’m delighted to see two recommendations now out I’m looking forward to the challenges ahead.

John Treadgold 

That’s it look, I think, I think we share a background in Canberra, and it’s funny, the Canberra connection of a certain, I guess, focus on recognising where power is in terms of politics and finance, but also appreciating nature and, and the trees and trying to bring them together.

Yeah. I mean, yeah, and

Tony Goldner 

I’m also I’m also really thrilled that Australia has been one of the top four markets of engagement in the TNFD process globally, alongside the UK, the US and Japan. So as a proud Aussie, I’m really delighted that we’ve had so much interest from Australia, as I said before, as one of the world’s 17 megadiverse countries, and only to the OECD developed economies, the other one being the US. I think this is a unique opportunity for Australia to lead the world in taking action scaling solutions. And so I’m particularly looking forward to seeing how Australia embraces the TNFD how parts of our framework can be taken in in mobilise action in other related areas on the nature agenda. The governance system announced that nature repair market is getting started and TCFD adoption is coming through regulation.

So, I’m hoping to see Australia really sort of accelerate and I think we’ve got a great history of pulling together different strands and capabilities in showing global leadership. I mentioned our global leadership in structured finance around infrastructure. I think that’s genuinely an area of global expertise that Australia has built. And it’s something that we need now on this nature challenge. So I’m also looking forward to opportunities to watch and follow Australian progress and hopefully find a way to contribute even though I’ve been overseas now.

John Treadgold 

That’s it. I’ll Tony, thank you so much. This is this is an incredible sort of output a really exciting moment, real cause for optimism, the opportunities are there. We’ll wrap this up, I need to let you go. But you appreciate what you talked about at the beginning, where ESG was the E and ESG was always really just ended up being emissions, and carbon and climate change. Big C instead of an E.

Yeah, exactly. But now you guys are filling the gaps, we need to recognise the importance of the environment. And that it’s not just another add on to climate change issues. It really does sit above, nature is essentially everything. And we depend on it for everything we do. So this is a really exciting process, and the momentum is strong. So that’s excellent. I will let you go. But before I do, can you please give us a book recommendation, I’m not sure if you’ve been reading a lot, maybe you’ve been depending on it. But if you if you had something to help people understand the world of nature, that would be great, or even if it’s just a good page turner on the side table.

Tony Goldner 

So one book I’d recommend is Ministry of the Future by Kim Stanley Robinson. A fiction book, based on incredible research about the state of the world today. And I think it’s a really fascinating sort of peer into the future about what might be coming. And the level of research the meticulous grounding of the story, in today’s reality, and looking ahead, I think it’s a real provocation. And I found it a really, really fascinating read.

John Treadgold 

That’s it incredible book paints a rather disturbing dystopia that when he wrote it seemed not the distant future isn’t of the near future. But that opening scene in India with the temperatures, reaching, you know, hot bulb temperatures, I think was that the term and lots of people dying, and this, this whole crisis, and I think I turn on the news now, and they use this language, and I’m like, hang on. This, is coming true now.

I mean, even for the SKUs tricky forest had an ethics announcement, saying that these are the these are the dangers in terms of this extreme humidity. And if you’ve got those forces coming together, fiction writers, industrialists, and that it’s being stated in investment documentation that that’s, you know that this is a pragmatic as it comes to big moment.

Tony Goldner 

Yeah, that’s right. And, you know, a big part of mobilising people to action is incredible storytelling. And we’re going to need a whole army of great communicators on nature in order to catalyse the kind of scale of action that’s required. I remember Al Gore after his famous movie started training people on how to communicate the science of climate change and the need for action in books like ministry of the future, and others that are hopefully going to be part of triggering the needs for, everyone who’s interested in passionate about this, whatever they’re doing in business or finance, to get out and advocate for others to also get on board because that’s what we’re going to need to move the needle in this problem.

John Treadgold 

I like that, Tony, that’s what I’m all about. That’s what the good future podcast is about. That’s what my businesses as an impact consultant is all about. So yeah, I echo all of that sentiment. And look, thank you for this. Thank you for all your work for providing these recommendations to the world and then everyone’s going to have a big week trawling through it. So just the beginning. Let’s go.

Tony Goldner 

Yep, absolutely, John, thanks for having me on the show.

Thanks, Tony.