Taskforce on Nature-related Financial Disclosures urges EFRAG to merge ESRS E2 to E5 into a single integrated nature standard

The Taskforce on Nature-related Financial Disclosures (TNFD) wrote to the Chair of the EFRAG Sustainability Reporting Board with a proposal to simplify the nature-related European Sustainability Reporting Standards being reviewed under the European Union Omnibus package. The core recommendation is to consolidate the existing ESRS E2 to E5 into one integrated nature standard, positioned as a revised ‘E2’ that complements other simplification levers under consideration. TNFD argues that an integrated standard should cover four Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services drivers of nature change beyond climate change and span all four realms of nature (land, ocean, freshwater and atmosphere). To preserve decision-useful reporting, it recommends a structured nature materiality assessment explicitly encouraging the TNFD LEAP (Locate, Evaluate, Assess and Prepare) framework, elevating disclosure of nature-related “dependencies” by moving from “IROs” to “DIROs”, and reducing quantitative datapoints by prioritising cross-sector indicators organised around drivers of nature change, drawing on TNFD’s recommended 14 core indicators and sector-specific metrics. The letter points to growing voluntary market adoption of TNFD-aligned disclosures, including 600 organisations representing over EUR 13 trillion in assets under management. TNFD indicated it will provide further technical detail during the upcoming consultation period on the ESRS exposure drafts and offered to engage further with EFRAG and European stakeholders.