Nature and biodiversity: the ISSB's next topic

After climate, nature is the sustainability topic investors most often raise: deforestation, water scarcity and the loss of pollinators can disrupt supply chains, raise costs and change regulation. The ISSB has chosen a lighter route than a new standard, but its proposals, built on the TNFD's framework, will shape how companies report nature-related risks to investors. This guide explains what nature-related disclosures are, what the ISSB has decided, what IFRS S1 already requires, works through a food company's assessment using LEAP, and covers the TNFD, the ESRS and GRI, and how to prepare.

By Awais Jameel, Chartered Accountant. Reviewed by Muhammad Bilal, Chartered Accountant. 3 minute read.

Short answer

Nature-related disclosures explain the risks and opportunities a company faces from its dependencies and impacts on nature, such as water, soils, pollination, forests, oceans and biodiversity. In April 2026, the ISSB decided to propose its nature-related requirements as an IFRS Practice Statement that companies can choose to apply alongside IFRS S1 and IFRS S2, rather than as a new standard or as amendments to the existing ones, to avoid disrupting their adoption. The proposals build on the recommendations of the Taskforce on Nature-related Financial Disclosures (TNFD). In July 2026 the ISSB confirmed it could begin balloting the exposure draft, with a 120-day comment period, and publication was expected in October 2026, around the UN biodiversity conference. Nature is not new to the ISSB standards: IFRS S1 already requires disclosure of all material sustainability-related risks and opportunities, including nature-related ones. Many companies use the TNFD's LEAP approach, to locate, evaluate, assess and prepare, to find them. In the EU, ESRS E4 covers biodiversity from both the impact and financial perspectives.

At a glance

ISSB approach
A Practice Statement
Status
Exposure draft expected
Builds on
TNFD recommendations
Already required
Material risks, IFRS S1
Method
LEAP assessment
EU equivalent
ESRS E4 Biodiversity
Nature and biodiversity: the ISSB's next topicISSB approach: A Practice Statement; Status: Exposure draft expected; Builds on: TNFD recommendations; Already required: Material risks, IFRS S1; Method: LEAP assessment; EU equivalent: ESRS E4 Biodiversity.KEY FACTS AT A GLANCENature and biodiversity: the ISSB's next topicISSB approachA Practice StatementStatusExposure draft expectedBuilds onTNFD recommendationsAlready requiredMaterial risks, IFRS S1MethodLEAP assessmentEU equivalentESRS E4 BiodiversityTax BakersNature and biodiversity: the ISSB's next topicISSB approach: A Practice Statement; Status: Exposure draft expected; Builds on: TNFD recommendations; Already required: Material risks, IFRS S1; Method: LEAP assessment; EU equivalent: ESRS E4 Biodiversity.KEY FACTS AT A GLANCENature and biodiversity: theISSB's next topicISSB approachA Practice StatementStatusExposure draft expectedBuilds onTNFD recommendationsAlready requiredMaterial risks, IFRS S1MethodLEAP assessmentEU equivalentESRS E4 BiodiversityTax Bakers
Key facts at a glance, as set out in this guide.

What are nature-related disclosures?

Nature-related disclosures cover how a company depends on nature, for example on water, healthy soils, pollination or stable ecosystems, and how it affects nature, through land and sea use change, resource extraction, pollution, climate change and invasive species. Dependencies and impacts create risks, such as supply disruption, regulation, litigation and reputational damage, and opportunities, such as products that restore nature. Investors want to know which of these could affect a company's cash flows. See financial materiality.

What has the ISSB decided?

After researching biodiversity, ecosystems and ecosystem services from 2024, the ISSB agreed in April 2026 to propose an IFRS Practice Statement on nature-related disclosures, which would supplement IFRS S1 and S2 without changing them. A company could choose to apply it, and jurisdictions could require it. In July 2026 the Board confirmed that due process steps were complete and that balloting of the exposure draft could begin, with a 120-day comment period; publication was expected in October 2026. Final requirements would follow after consultation. See IFRS S1.

Do IFRS S1 and S2 already require nature information?

Yes, where material. IFRS S1 requires disclosure of all sustainability-related risks and opportunities that could reasonably be expected to affect a company's prospects, and it allows companies to consider guidance such as the CDSB Framework's application guidance on water and biodiversity when identifying them. IFRS S2 covers climate, which interacts with nature through deforestation, land use and physical risk. The Practice Statement would add specific requirements and guidance rather than create the obligation. See IFRS S2.

Nature-related disclosures in practice: a food company using LEAP

A food company sourcing from 40 regions applies the TNFD's LEAP approach.

A food company's LEAP assessmentA food company's LEAP assessmentWhat it didWhat it foundLocateMapped 40 sourcingregions and plants12 in stressed orsensitive areasEvaluateAssessed dependenciesand impactsWater, pollination;land conversion for soyAssessTurned them intorisks and opportunitiesSupply, cost andregulatory riskPrepareSet responseand reportingDisclose under S1 now;targets on sourcing
LEAP turns location data into decision-useful disclosures.

It finds that 12 of its 40 sourcing regions, 30%, are in water-stressed or biodiversity-sensitive areas, that its key ingredients depend on water and pollination, and that soy in its supply chain is linked to land conversion. The resulting risks, supply disruption, rising input costs and deforestation rules in key markets, are material to investors, so it discloses them under IFRS S1 now, with its regenerative sourcing programme as an opportunity, and plans to apply the Practice Statement once issued. See climate scenario analysis.

What is the TNFD framework?

The Taskforce on Nature-related Financial Disclosures published its recommendations in September 2023: 14 recommended disclosures across governance, strategy, risk and impact management, and metrics and targets, mirroring the climate disclosure architecture, with guidance by sector and biome. Its LEAP approach helps companies locate their interface with nature, evaluate dependencies and impacts, assess risks and opportunities, and prepare to respond and report. The ISSB's proposals draw on this work, so companies already using the TNFD are well placed.

How does this relate to ESRS E4 and GRI 101?

ESRS E4 requires companies to report material biodiversity impacts, dependencies, risks and opportunities, including sites in or near biodiversity-sensitive areas, using double materiality. GRI 101 Biodiversity 2024 focuses on impacts, including in the supply chain. The ISSB's proposals focus on investors, so a company may report nature under all three, reusing the same location and impact analysis. See ESRS E2 to E5 and GRI topic standards.

How can companies prepare?

Map operations and key supply chains by location, identify the dependencies and impacts that matter most, assess which create material risks or opportunities, and connect them to strategy and financial planning. Start with the most exposed commodities and sites, use recognised tools for water stress and biodiversity sensitivity, and keep the analysis consistent with climate disclosures. See impacts, risks and opportunities and water and waste metrics.

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Questions people ask

What are nature-related disclosures?

Information about the risks and opportunities a company faces from its dependencies and impacts on nature, such as water, soils, pollination and biodiversity.

Is the ISSB issuing a nature standard?

No. In April 2026 it decided to propose an IFRS Practice Statement that companies can choose to apply alongside IFRS S1 and S2.

Does IFRS S1 already require nature-related information?

Yes, where nature-related risks and opportunities are material to the company's prospects.

What is the TNFD's LEAP approach?

A four-phase method to locate a company's interface with nature, evaluate dependencies and impacts, assess risks and opportunities, and prepare to respond and report.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IFRS Foundation: Nature-related Disclosures project
  2. IFRS Foundation: ISSB agrees on the proposed way forward for nature-related disclosures, May 2026
  3. XBRL International: ISSB agrees path forward on nature-related disclosures
  4. IFRS Foundation: IFRS Sustainability Disclosure Standards (IFRS S1 and IFRS S2)
  5. S&P Global: ISSB update, second quarter 2026

Rules and fees change. If you are reading this long after October 14, 2026, confirm the figures with the source before you rely on them.

SustainabilityESRS E2 to E5: pollution, water, biodiversity and resourcesSustainabilityIFRS S1: general requirements explainedSustainabilityGRI topic standards

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