Shauna joined the BD team at Integrum ESG in 2021, having previously worked in similar roles within Fintech companies. She holds a BA in English and New Media Studies from the University of Limerick, Ireland.
A practical guide to biodiversity risk, TNFD and the core metrics entering investment analysis
Biodiversity is rising quickly on investor agendas. As climate risk has become embedded in ESG processes, attention is now turning to how nature loss may affect companies and portfolios.
Yet unlike climate, biodiversity does not sit within a single, established regulatory framework. Investors are still determining which standards to follow, which metrics are decision-useful and how to apply emerging guidance in practice. The need is there, but implementation remains less defined.
This article provides a practical overview of how biodiversity risk is entering investment analysis and highlights the core metrics and approaches investors should understand.
Short on time? Speak to our team to understand how biodiversity risk can be quantified across your portfolios.
Nature underpins economic activity. Companies depend on ecosystem services such as water availability, soil health, pollination, coastal protection and stable land systems.
When biodiversity declines, those dependencies become vulnerabilities, including:
This is why biodiversity is increasingly treated as a portfolio risk lens alongside climate, governance and other financially material ESG factors.
The Taskforce on Nature-related Financial Disclosures (TNFD) is shaping how financial markets approach nature related risks and opportunities. It provides a structure for assessing exposure, dependencies and impacts, then translating those into financial risk considerations and disclosures.
As adoption grows, asset managers and asset owners are increasingly expected to show how they:
This has increased demand for biodiversity data that can support TNFD aligned analysis at company, asset and portfolio level.
As nature related risks rise up the agenda for investors, a growing number of financial institutions are aligning with the TNFD framework. The TNFD adopter page outlines which institutions have already committed to the framework and explains how organisations can become TNFD adopters themselves.
Biodiversity analysis is typically built on detailed asset location data. Without accurate mapping of where companies operate, it is difficult to assess exposure to ecosystems, measure impact or understand dependency risk.
On that foundation, biodiversity is measured through a combination of impact, exposure and dependency indicators.
The most common categories are:
1. Ecosystem integrity indicators
These describe the condition of nature around operations and assets. A widely used example is Mean Species Abundance (MSA).
2. Biodiversity footprint indicators
These quantify biodiversity impact in a way that can be compared across companies and portfolios. A widely used example is Potentially Disappeared Fraction of species (PDF).
3. Sensitive location and proximity indicators
These assess whether assets are located in or near areas of biodiversity importance such as protected areas, key biodiversity areas or high sensitivity habitats.
4. Ecosystem service dependency indicators
These measure how much a company relies on services such as water provisioning, flood protection or pollination which can become operational risks when ecosystems degrade.
For investment teams, the practical objective is not to track every biodiversity metric available.
It is to combine asset location data, integrity indicators, footprint metrics and dependency analysis into a coherent view of nature-related exposure and risk that can inform portfolio decisions.
As biodiversity and nature related risks become more financially material, investors need reliable data to assess exposure and inform decisions. Biodiversity Intelligence provides transparent, decision useful insights that help investors analyse nature related risks and strengthen sustainability reporting.
Biodiversity data is now used across common investor workflows, especially where asset location and sector exposure matter.
Typical use cases include:
What matters is consistency. Investors need biodiversity intelligence that can be applied across thousands of companies, multiple asset classes and large portfolios without becoming a bespoke research exercise for every holding.
Leading asset managers, asset owners, banks and wealth managers are beginning to integrate nature related risks into their investment processes. Real world examples of how financial institutions are embedding nature considerations into investment decision making illustrate the approaches emerging across the sector.
To support this shift, Integrum ESG and GIST Impact have partnered to deliver biodiversity and natural capital intelligence to asset managers and asset owners through a single ESG workflow.
Integrum ESG provides ESG intelligence designed for investment teams, with transparent, actionable workflows that support benchmarking, monitoring, due diligence and reporting.
GIST Impact provides biodiversity and nature analytics across more than 20,000 companies and over 3 million mapped corporate assets globally.
This includes asset-level geospatial data, ecosystem integrity indicators such as Mean Species Abundance (MSA) and biodiversity footprint indicators such as Potentially Disappeared Fraction of species (PDF), all built on granular location data and clearly defined methodologies.
Together, the partnership enables investors to answer practical questions such as:
The objective is simple: to provide biodiversity data and analytics that are transparent, scalable and usable within existing ESG processes, enabling investment teams to quantify nature-related risk with confidence.
For many firms, the first step is to focus on a small set of portfolio level questions and build from there.
Common recommended starting points for investors include:
- mapping portfolio exposure to sensitive locations
- identifying sector and geography hotspots
- introducing biodiversity footprint indicators such as PDF where relevant
- introducing ecosystem integrity indicators such as MSA for location context
- aligning outputs to the Taskforce on Nature-related Financial Disclosures (TNFD)
Biodiversity does not need to be treated as a separate workstream. It can be integrated into the same processes used for ESG risk monitoring, due diligence and reporting.
If you want to understand how biodiversity data can be integrated into your investment workflows, including TNFD aligned analysis, speak to the Integrum ESG x GIST Impact team.
We can walk through the biodiversity datasets, the coverage across companies, assets and portfolios and how these fit into existing ESG monitoring, due diligence and reporting.
Speak to an Integrum ESG Expert today.
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