Abbie joined Integrum ESG as Head of Business Development in 2025. Prior to this, Abbie headed up the Sales Team at SeedLegals, consistently driving double digit YoY growth. Having worked in a variety of Sales roles in multiple industries (Digital Marketing, Law, Fashion, LegalTech), Abbie has a keen awareness of understanding exactly what a prospective client needs, in order to translate this into a successful product and commercial strategy. Abbie has a M.A. in Modern Languages from Oxford University.
The essential biodiversity and nature risk terms entering investment analysis, and what each one means for your portfolio.
Nature risk is gaining traction in investment analysis, but the language around it is dense. This glossary is designed to make it less so.
It covers 15 terms that any investor engaging with nature risk should understand, explains what each one measures and why it matters, and identifies where each term connects to TNFD reporting and portfolio-level analysis.
Short on time? Speak to our team to understand how biodiversity risk can be quantified across your portfolios.
The TNFD is a global framework that provides guidance on how organisations should identify, assess, manage and disclose nature-related risks and opportunities. It is structured around four disclosure pillars: governance, strategy, risk management and metrics and targets.
At the core of the TNFD's analytical approach are four categories that define how businesses interact with nature: dependencies, impacts, risks and opportunities. Dependencies capture what a business relies on from nature. Impacts capture what a business does to nature. Risks capture the financial consequences of those dependencies and impacts. Opportunities capture the potential for positive outcomes through nature-positive strategies, restoration or innovation. These four categories run through the entire framework and are central to how investors are expected to assess nature-related exposure.
For investors, TNFD is the closest equivalent to the TCFD framework for climate, but applied to nature and biodiversity. It provides a common language for how nature risk should be reported and integrated into financial decision-making.
TNFD adoption is accelerating. Asset managers and asset owners are increasingly expected to demonstrate how they identify nature-related exposure across their portfolios. Understanding TNFD is foundational to engaging with every other term in this glossary.
For a broader overview of how biodiversity risk is entering investment analysis, see Biodiversity and Nature Risk Explained.
LEAP is the analytical process recommended by the TNFD for identifying and assessing nature-related issues. It consists of four phases:
LEAP is not a one-off exercise. It is designed as an iterative process that deepens over time as data quality and organisational capacity improve. For investors, the LEAP approach provides a structured way to move from identifying which holdings have nature exposure to quantifying how material that exposure is.
Most of the metrics and concepts in this glossary sit within one or more phases of LEAP. Understanding where each term fits within the Locate-Evaluate-Assess-Prepare structure helps build a coherent approach to nature risk analysis.
ENCORE is a tool and database developed by the Natural Capital Finance Alliance and UNEP-WCMC. It maps how sectors and sub-industries depend on ecosystem services and how they create pressures on nature.
ENCORE provides a standardised, sector-level view of where nature dependencies and impacts are likely to be most material. It does not provide company-specific data on its own, but it serves as the foundation for many company-level and portfolio-level nature risk assessments.
In a TNFD context, ENCORE is widely used in the Evaluate phase of LEAP, helping investors understand which ecosystem services are relevant for the sectors they hold and where pressures on ecosystems are most likely to arise.
Natural capital refers to the stock of natural resources and ecosystems that provide value to the economy and society. This includes living assets such as forests, wetlands and marine environments as well as non-living assets such as minerals, soils and freshwater systems. Together, these assets underpin the ecosystem services that businesses and economies depend on.
The concept matters to investors because it frames nature as an asset base rather than an externality. When natural capital is depleted or degraded, the ecosystem services it provides become less reliable, creating financial risk for companies and portfolios with exposure to those services.
Natural capital accounting is gaining traction in both corporate reporting and sovereign-level analysis. Within the TNFD framework, nature-related risks are ultimately risks to and from natural capital, making the concept a useful anchor for understanding why biodiversity loss has financial consequences.
Ecosystem services are the benefits that natural capital provides to economic activity. They include provisioning services such as freshwater supply and raw materials, regulating services such as flood control, water purification and climate regulation, and supporting services such as soil formation and nutrient cycling.
The concept is central to biodiversity risk analysis because it connects ecological condition to financial materiality. When an ecosystem service degrades, the companies that depend on it face operational disruption, increased costs or supply chain instability.
In the TNFD framework, ecosystem services sit at the heart of the Evaluate phase. Identifying which services a company depends on and assessing how vulnerable those services are is a core step in determining nature-related risk.
A nature-related dependency is a reliance by a business on an ecosystem service to maintain its operations, production or revenue. Examples include dependence on clean water for manufacturing, reliance on pollination for agricultural supply chains or use of natural flood protection to safeguard coastal infrastructure.
Dependencies are central to understanding nature risk because they define the transmission mechanism: when an ecosystem service degrades, the companies that depend on it are exposed.
Under the TNFD's LEAP approach, evaluating dependencies is a core step in the Evaluate phase. ENCORE-aligned dependency assessments help identify which ecosystem services are material for a given sector, while revenue-based commodity analysis captures upstream supply chain exposure.
Pressures on ecosystems describe the ways in which business activities contribute to the degradation of natural systems. The scientific literature and TNFD guidance recognise five primary drivers of nature loss:
Where dependencies describe what a company takes from nature, pressures describe what a company does to nature. Both are needed for a complete picture of nature-related risk, and the TNFD framework requires organisations to assess both.
ENCORE-aligned pressure assessments map these impacts by sector and sub-industry, providing a standardised view of which pressures are most relevant for a given portfolio holding.
Key Biodiversity Areas are sites that have been identified as globally significant for the persistence of biodiversity, using a set of standardised scientific criteria. There are more than 16,000 KBAs worldwide, identified through the Integrated Biodiversity Assessment Tool (IBAT).
For investors, KBAs matter because companies with assets in or near these areas face heightened exposure. Proximity to a KBA can indicate potential transition risk from stricter land-use regulation, reputational risk from association with biodiversity-sensitive locations and physical risk if the ecosystem services provided by the area are degraded.
KBA proximity analysis is a core component of the Locate phase within the TNFD's LEAP approach. It is one of the most direct ways to screen a portfolio for nature-related exposure. In practice, this analysis is typically applied alongside proximity to WDPA Protected Areas and IUCN Red List species habitats to build a comprehensive sensitive location profile.
Mean Species Abundance is an ecosystem integrity indicator that measures how intact biodiversity is in a given area relative to its undisturbed natural state. An MSA of 100% means the area retains its full original biodiversity. Lower values indicate degradation.
MSA is useful for assessing the condition of ecosystems around company assets. If a company operates in areas with low MSA, the ecosystems it depends on may already be under stress, increasing the likelihood that dependencies will be disrupted.
In TNFD terms, MSA supports the Locate and Evaluate phases by helping investors understand the ecological context in which companies operate. It answers the question: how healthy is nature where this company has its footprint?
The Biodiversity Intactness Index measures how much of a location's original biodiversity remains relative to an undisturbed baseline. Like MSA, it describes ecosystem condition, but BII is derived from a different modelling approach and is often presented at a finer spatial resolution.
BII is particularly useful for location-level screening. It helps investors identify which company assets are situated in areas where biodiversity has already been significantly eroded, signalling potential vulnerability in terms of ecosystem service reliability and regulatory attention.
Within the TNFD framework, BII supports the Locate phase by providing a measurable indicator of ecological condition at specific sites.
Biodiversity footprinting is the practice of measuring and quantifying the impact that a company, portfolio or economic activity has on biodiversity. It converts complex environmental pressures into standardised, comparable metrics that can be used across companies and sectors.
The core purpose is to answer a question that investors increasingly need to address under the TNFD framework: how much biodiversity impact is this company responsible for, and how does that compare with its peers?
Footprinting draws on data across multiple impact drivers, including greenhouse gas emissions, water consumption, land use, pollution and waste generation.
These inputs are modelled through scientific frameworks that estimate their effect on species and ecosystems, producing metrics that can be tracked over time, benchmarked against sector averages and aggregated to portfolio level.
The most widely used biodiversity footprinting metrics are the Potentially Disappeared Fraction of Species (PDF), which quantifies impact in terms of species loss, and Land Conversion Equivalence (LCE), which translates the same underlying impact into square kilometres of land effectively converted from a natural to an urban state.
PDF is the more widely referenced of the two in TNFD-aligned reporting and investor frameworks, which is why it is covered in detail below. LCE is typically presented alongside PDF to give a spatial dimension to the same analysis.
PDF is the headline metric within biodiversity footprinting. It quantifies the fraction of species that may be lost as a result of the environmental pressures created by business activity, capturing the cumulative effect of multiple impact drivers and translating them into a single, comparable figure.
PDF is expressed as a very small number (for example, 2.24 x 10⁻⁴) representing the fraction of global species put at additional risk of extinction. While the absolute number may seem small, it represents a meaningful contribution to biodiversity loss when aggregated across an entire portfolio.
A related metric, Land Conversion Equivalence (LCE), translates the same underlying impact into square kilometres of land effectively converted from a natural to an urban state. The two are often presented together to give both a species-based and a spatial view of biodiversity impact.
For investors, PDF provides a way to compare biodiversity impact across companies and sectors on a like-for-like basis. It supports the Assess phase of LEAP by helping to determine which holdings carry the greatest biodiversity burden, with trend data available back to 2016 to track performance changes over time.
Physical risk in a nature and biodiversity context refers to the direct operational and financial impacts that result from ecosystem degradation or environmental hazards. This includes water stress that constrains production, flooding driven by loss of natural flood defences, soil degradation that reduces agricultural yields and extreme weather events amplified by ecosystem loss.
Physical risk assessment requires asset-level geolocation data. Without knowing where a company's operations and supply chains are located, it is not possible to assess exposure to specific environmental hazards.
Under the TNFD framework, physical risk is a core risk category. Comprehensive assessment typically covers multiple forms of chronic and acute hazard, including water stress, water demand, drought, riverine and coastal flooding, temperature anomaly, extreme heat and cyclone risk, applied at individual asset level.
Transition risk in a biodiversity context refers to the financial risks that arise as economies, regulations and markets shift in response to nature loss.
This includes policy changes such as stricter permitting requirements or land-use restrictions, reputational consequences from association with biodiversity-harmful activities and market shifts as supply chains adjust to ecosystem constraints.
Transition risk is distinct from physical risk. Where physical risk captures direct operational disruption from ecosystem degradation, transition risk captures the indirect financial consequences of societal and regulatory responses to nature loss.
Under the TNFD framework, transition risk is a core category that investors are expected to identify and assess.
Proximity to sensitive locations such as Key Biodiversity Areas is one indicator of potential transition risk, as companies operating near protected or ecologically important sites may face heightened regulatory or reputational exposure.
Nature Value at Risk is a financial metric that quantifies how much of a company's production and revenue could be disrupted if the ecosystems it depends on degrade significantly. It brings together many of the concepts in this glossary, from ecosystem service dependencies and location analysis to sector-level vulnerability, into a single, portfolio-ready risk signal.
The formula is:
NVaR = Potential Loss x Exposure
Potential loss captures how severely ecosystem disruption could affect a given sector in a specific location. It is determined by three factors: the degree of stress on the relevant ecosystem service (hazard), how sensitive the sector is to disruption of that service (vulnerability) and a sector-specific calibration factor that grounds the output in real-world production variability (maximum loss). Exposure reflects how much of a company's economic activity takes place in each relevant location.
The output is expressed either as a percentage of production at risk or as a monetary figure representing revenue at risk. NVaR is calculated across both direct operations and supply chains, since for many companies the most significant biodiversity risk sits upstream.
NVaR sits within the Assess phase of LEAP, where the objective is to determine how material nature-related risks are in financial terms. For most investors, it is the strongest starting point for translating biodiversity exposure into the language of investment risk.
For a full explanation of how NVaR is calculated and applied, including a worked example, see Nature Value at Risk (NVaR) | What It Is and How to Calculate It.
Every metric and concept covered in this glossary is available as actionable data through the Integrum ESG Platform.
Biodiversity Intelligence covers more than 20,000 companies and 3 million mapped corporate assets. Whether you need to screen a portfolio for KBA proximity, assess biodiversity impact through PDF and MSA or quantify financial exposure through NVaR, the data sits within a single platform alongside Integrum’s broader suite of ESG intelligence.
Coverage spans company, asset and portfolio level, supporting workflows from initial screening through to TNFD-aligned reporting.
If you want to see how these metrics apply to companies you hold or are evaluating, our ESG experts can walk you through the data.
Speak to an Integrum ESG Expert today.
If you want to see how these metrics apply to companies you hold or are evaluating, our ESG experts can walk you through the data.
Browse frequently asked questions about the platform.
Can’t find the answer you’re looking for? Please get in touch with our team.
