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The Taskforce on Nature-related Financial Disclosures (TNFD) was established in 2021 in response to the growing need to factor nature into financial and business decisions. The TNFD is a global, market-led initiative with the mission to develop and deliver a risk management and disclosure framework for organisations to report and act on evolving nature-related risks and opportunities, with the ultimate aim of supporting a shift in global financial flows away from nature-negative outcomes and toward nature-positive outcomes.

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To achieve these outcomes, the Taskforce resolved at its first meeting in October 2021 that the TNFD risk management and disclosure framework should be applicable to, and used by, business and financial institutions of different sizes, across sectors and jurisdictions, irrespective of their preferred or required approach to materiality. Halting and reversing nature loss, achieving nature-positive outcomes and mitigating and managing nature-related risks will only be possible if large and small businesses across supply chains and financial institutions of all types are collectively identifying, assessing, managing and disclosing nature-related dependencies, impacts, risks and opportunities.

The TNFD aims to build a risk management and disclosure framework that can be used by organisations of all sizes in all jurisdictions to identify, assess, manage and disclose nature-related dependencies, impacts, risks and opportunities.

The Taskforce is made up of 40 senior executives drawn from corporates, financial institutions and market intermediaries around the world and led by the TNFD Co-Chairs, Elizabeth Mrema and David Craig. Collectively, the Taskforce Members represent institutions with over US$20.6 trillion in assets under management and a footprint in over 180 countries. The Taskforce is supported by a larger institutional support base, the TNFD Forum, consisting of over 800 organisations globally, and a network of 18 core knowledge partners, including leading global scientific, conservation and standards development bodies, which are actively contributing to the development of specific aspects of the framework.

The TNFD is grateful to all those who have provided feedback on the beta framework to date and invites market participants and other stakeholders to continue to provide feedback on this v0.4 beta framework until 1 June 2023. All feedback received before that deadline will be reviewed and evaluated to inform the final recommendations (v1.0) to be launched in September 2023.

The Taskforce is launching a formal public consultation process from 30 March until 1 June 2023. This will be open to organisations and individuals in addition to the general feedback the TNFD collects through its general feedback survey. Both formal comment letters and general feedback can be submitted via the TNFD framework site:

The TNFD pilot testing programme is central to its open innovation approach to design and develop the TNFD framework with a focus on ensuring it is both science-based and practical to use. Nearly 200 organisations are currently designing, implementing or have completed a pilot test of the TNFD beta framework to explore its application in their organisational context. Approximately half of these pilots are financial institutions and half are corporates. Pilots cover all moderate to high nature-risk sectors identified as priorities by the TNFD in the v0.2 beta release, all realms and 40 countries across six continents. The feedback received from pilots to date has been considered in this v0.4 beta framework update.

A number of organisations have signalled an intention to continue pilot testing the framework beyond the deadline for feedback of 1 June 2023 because of the learning and capability building benefits for their organisation. To support those efforts, the TNFD will be sharing insights and experiences from the pilot testing undertaken over the past year through a series of TNFD Forum events.

The TNFD has partnered with the International Union for Conservation of Nature (IUCN) to engage with a range of representatives of Indigenous Peoples and Local Communities to leverage their knowledge and provide their voice and perspective to help design and develop the TNFD framework. The TNFD has held over 10 online and in-person meetings and sessions with the International Indigenous Forum on Biodiversity (IIFB), and bilateral sessions with civil society organisations working on societal dimensions of nature-related issues, to gather their input on the beta framework as it has been developed. In addition, pilot testing by Indigenous and Community-based Enterprises is being established and will run beyond June 2023.

To increase awareness, outreach and engagement on the TNFD framework in markets where there has been strong interest, market-led TNFD Consultation Groups have been activated at a national or regional level. Consultation Groups are championed by Taskforce members and convened by business or financial associations in local languages, highlighting local contexts. Participation in Consultation Groups is open to all institutional members of the TNFD Forum from that jurisdiction. There are 11 Consultation Groups, spanning four continents, as shown in Table 1.

This release marks the fourth and final TNFD beta framework publication (v0.4). For the first time, market participants can view a full representation of the framework, including examples of additional guidance by sector and biome. The Taskforce encourages and welcomes feedback by 1 June 2023 ahead of publication of its full set of recommendations in September 2023.

The core components and overall structure of the framework remain unchanged and consistent with v0.3. The Taskforce has developed and updated a range of guidance to help users interpret and apply the LEAP approach and to ensure the TNFD framework can be applied. The new and updated guidance documents included in the v0.4 release are shown in Figure 2.

With demand for an integrated nature-related risk management and disclosure framework growing, the TNFD seeks to provide recommendations and guidance of relevance to a wide range of market participants:

In this guidance, we provide a framework for analyzing whether a digital asset is an investment contract and whether offers and sales of a digital asset are securities transactions. As noted above, under the Howey test, an "investment contract" exists when there is the investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others. Whether a particular digital asset at the time of its offer or sale satisfies the Howey test depends on the specific facts and circumstances. We address each of the elements of the Howey test below.

[1] This framework represents the views of the Strategic Hub for Innovation and Financial Technology ("FinHub," the "Staff," or "we") of the Securities and Exchange Commission (the "Commission"). It is not a rule, regulation, or statement of the Commission, and the Commission has neither approved nor disapproved its content. Further, this framework does not replace or supersede existing case law, legal requirements, or statements or guidance from the Commission or Staff. Rather, the framework provides additional guidance in the areas that the Commission or Staff has previously addressed. See, e.g., Report of Investigation Pursuant to Section 21(a) of the Securities Exchange Act of 1934: The DAO (Exchange Act Rel. No. 81207) (July 25, 2017) ("The DAO Report"); William Hinman, Digital Asset Transactions: When Howey Met Gary (Plastic), Remarks at the Yahoo Finance All Markets Summit: Crypto (June 14, 2018), available at -hinman-061418.

[2] The term "digital asset," as used in this framework, refers to an asset that is issued and transferred using distributed ledger or blockchain technology, including, but not limited to, so-called "virtual currencies," "coins," and "tokens."

[4] This framework is intended to be instructive and is based on the Staff's experiences to date and relevant law and legal precedent. It is not an exhaustive treatment of the legal and regulatory issues relevant to conducting an analysis of whether a product is a security, including an investment contract analysis with respect to digital assets generally. We expect that analysis concerning digital assets as securities may evolve over time as the digital asset market matures. Also, no one factor is necessarily dispositive as to whether or not an investment contract exists.

[7] Issuers of digital assets, like all issuers, must provide full and fair disclosure of material information consistent with the requirements of the federal securities laws. Issuers of digital assets should be guided by the regulatory framework and concepts of materiality. What is material depends upon the nature and structure of the issuer's particular network and circumstances. See TSC Industries v. Northway, 426 U.S. 438, 449 (1976) (a fact is material "if there is a substantial likelihood that a reasonable shareholder would consider it important" in making an investment decision or if it "would have been viewed by the reasonable investor as having significantly altered the 'total mix' of information made available" to the shareholder).

The framework is guided by the principal policy objectives of the United States as laid out in the Executive Order on Ensuring Responsible Development of Digital Assets (March 9, 2022) and tailored to reflect the international aspects of our work:

Regional and Bilateral Engagements: The United States will identify where existing regional and bilateral engagements can be strengthened and, where appropriate, ramp up engagement with new partners to achieve our objectives with respect to digital assets. The United States will use these engagements under a coordinated framework for prioritization across departments and agencies to explore potential opportunities and risks of digital assets, engage in information sharing, drive the adoption and implementation of policies including with respect to AML/CFT; and provide technical assistance, where appropriate. The United States will explore opportunities for joint experimentation on digital assets technologies, market innovations and CBDCs, with this core set of allies and partners to increase our shared learning about ways to develop systems that meet our shared policy objectives. 041b061a72