JBA comments on the TNFD Nature-related Risk & Opportunity Management and Disclosure Framework Beta v0.2
CommentsQuestions
GeneralPlease provide your feedback

Efforts that are related to natural capital are important for global sustainability. We welcome the progress of consideration through open
innovation, as in beta v0.2 many parts have been made easier to understand, such as improvements in LEAP-FI.
On the other hand, although the concept is organized, there are still issues for which specific guidance, metrics and targets are yet to beprovided. It is necessary to establish methodologies and ensure comparability, and to ensure feasibility in disclosure.
In addition, financial institutions' approach to natural capital is mostly through their clients. It is necessary for financial institutions to consider
disclosure by an investee/borrower in order to understand the risks and opportunities related to the impact that their clients' corporate activities
will have on nature.
As the sectors and areas are wide-ranging, we believe that an approach from material sectors would be more effective than a stacked approachfrom locations. We look forward to sector-specific guidance, including for the non-financial sector.

How might we improve the TNFD Understanding Nature component?

-How might we improve the TNFD Draft Disclosure Recommendations?

We understand that in beta v0.2, consideration of disclosure standards has progressed to a certain extent. On the other hand, there are many
issues that are currently not clear, such as the development of comparable indicators and the measurement methodology of the indicators, andwe hope that the forthcoming recommendations will take practical aspects into consideration.

How might we improve the TNFD LEAP Approach?

The phases of the LEAP approach are too fragmented and not practical. In addition, there appears to be some overlap in work between phases,
so we would like to see a more sophisticated and concise approach.

How might we improve the TNFD draft approach to Metrics and Targets?

-

How might we improve the TNFD approach to specific guidance?

-

Which additional guidance would be valuable to you?

-

How willing are you (from 1-10) to recommend the TNFD Disclosure
Recommendations to others.

4

How willing are you (from 1-10) to recommend the TNFD LEAP Approach - to others. 7
What other recommendations / learnings / insights do you have for TNFD?

-Understanding Nature
The scope for what constitutes 'nature' is clear.

NeutralComments

Although the broad nature realms such as "land," "ocean," "freshwater," and "atmosphere " are shown, it is difficult for companies toincorporate them into specific actions because they do not deeply refer to the diverse elements that make up each of these realms. Henceforth, itis necessary to indicate the priority of the elements in each realm.
1CommentsQuestions
The definition of nature-related impacts is clear.

NeutralComments-The definition of nature-related dependencies is clear.

NeutralComments

We understand the definition of "dependency" to a certain extent, because many tools related to "dependency" have been introduced. But, we
believe that the quantitative criteria for judging the degree of dependence are still not clear.

The definition of nature-related risks is clear.

NeutralComments

Although we now have a better understanding of the concept of the three risks of "physical risk", "transition risk", and "systemic risk" to acertain extent, it is not clear what kind of "physical risk", "migration risk" and "systemic risk" exist in which areas of nature, and which risks
should be given priority. It is a situation in which the risk cannot be analyzed according to the indicated definition. Henceforth, it is necessary
to develop guidance that comprehensively presents definitions with more specific indicators, such as the materiality and measurement methodsof each risk in each nature realm.

The definition of nature-related opportunities is clear.

Disagree

Comments

We believe that the definition of "activities that create positive outcomes for organisations and nature by avoiding or reducing impact onnature, or contributing to its restoration" is too vague to incorporate into a company's business strategy.

The definitions provided support for your evaluation of nature-related impacts anddependencies.

Disagree

Comments

More specific and integrated guidance is needed to assess the impact and dependencies of natural capital.

The definitions provided support your assessment of nature-related risks andopportunities.

NeutralCommentsAt this point, the indicators for evaluating "risks" and "opportunities" are not clear, and it is difficult to conduct evaluations.

The structure provided is useful to organize your thinking around nature.

Agree

Comments-What additional concepts - definitions could support your assessment of nature-related
It is necessary to set quantitative targets and metrics for risks and opportunities for specific natural capital, such as water and forests.
risks and opportunities?
The relationship between 'climate' and nature across the framework is clear andcoherent.

Disagree

Comments

As for the relationship, it is not clear where exactly it is linked, or which item of "nature" the risk of "climate" affects. We cannot say that it isconsistent.
2Comments

Questions
TNFD Disclosure Recommendations
Overall, the disclosure recommendations are clear and coherent.

NeutralComments-

The disclosure recommendations for the Governance pillar are clear and coherent.

NeutralComments-

The disclosure recommendations for the Strategy pillar are clear and coherent.

NeutralComments-

The disclosure recommendations for the Risk Management pillar are clear andcoherent.

NeutralComments-

The disclosure recommendations for the Metrics & Targets pillar are clear andcoherent.

NeutralComments-The disclosure recommendations are relevant to our business model.

Disagree

Comments

It is very difficult for financial institutions to identify risks and opportunities concretely by distinguishing between individual ecosystems,biomes, regions, and natural capital. In addition, since the risks and opportunities for clients also differ from company to company, it isdifficult to compare the risks and opportunities for companies with disclosure in accordance with the recommendations. It is difficult for
financial institutions to find the significance of disclosure. Guidance should be given to identify natural capital that requires urgent attention
and to disclose it in line with the same indicators.

The disclosure recommendations are relevant to our current management maturity level
Neutralin relation to nature-related risks and opportunities.
Comments

At this point, we have not yet been able to identify and manage risks and opportunities related to nature, and it is necessary to further develop amanagement system for disclosure in accordance with the recommendations.

The disclosure recommendations fit well with our current disclosures on GHG andsustainability overall.

Disagree3

Comments

Questions

Comments

Unlike climate change, it is difficult to cover the "metrics and targets" of disclosure recommendations for natural capital and biodiversity witha single indicator such as GHG emissions, and it is difficult to disclose them in the same way as climate change. Since the risks associated withnatural capital and biodiversity vary greatly depending on the business and region, further consideration should be given to how to define"metrics and targets" if disclosure is recommended in line with the "four pillars" similar to the TCFD.

The level of resources required for implementation is appropriate.

Disagree

Comments

Currently, the tools and practical operations are not clear, and the level of resources required for implementation is also unclear.

The level of time commitment required for implementation is appropriate.

Disagree

Comments

Currently, the tools and practical operations are not clear, and the timeline required for implementation is also unclear.

Is your organisation currently using any of the following management frameworks?

-The disclosure recommendations links well to my organisation's current reporting
practices and approach.

NeutralComments-Should the disclosure recommendations provide linkages to additional disclosure
standards used by your organization?

-Comments-The linkages provided to existing standards / metrics are relevant and useful.

Neutral

TNFD LEAP Approach – a management framework for nature-related risks and opportunities
The LEAP Approach was applicable and useful to our business.

NeutralComments

The LEAP approach for financial institutions is useful, as it allows for asset class-specific analysis. On the other hand, it is hoped that specificguidance will be developed in the future on how financial institutions should assess nature-related risks and opportunities and how to develop
strategies.

The LEAP Approach is relevant to our business model.

Agree

Comments-The LEAP Approach is relevant to our current management maturity level in relation toNeutral
nature-related risks and opportunities.
4Comments

Questions
Comments

At this point, we have not yet been able to identify and manage nature-related risks and opportunities, and it is necessary to further develop amanagement system in order to achieve disclosure in accordance with the recommendations. However, in order to establish a management
system, it is necessary to present examples of specific indicators and targets for financial institutions under LEAP-FI.

The disclosure recommendations link well to my organisation's current reporting
practices and approach.

NeutralComments

Unlike climate change, it is difficult to cover the "metrics and targets" of disclosure recommendations for natural capital and biodiversity witha single indicator such as GHG emissions, and it is difficult to disclose them in the same way as climate change. Since the risks associated withnatural capital and biodiversity vary greatly depending on the business and region, the reporting practices of "metrics and targets" are very
different from those of the TCFD, and it is difficult to link them with current reporting practices and approaches.

Is your organisation currently using any of the following management frameworks?

-The LEAP Approach is applicable based on the level of aggregation required for myorganization.

NeutralComments-Should the disclosure recommendations provide linkages to additional disclosure
standards used by your organization?

-If Yes (which?)-The linkages provided to existing approaches / management frameworks are relevant
and useful.

-Comments-The level of resources required for implementation is appropriate.

NeutralThe amount of resources required for implementation is not clear.

Comments

In addition, the scope of data and analysis of dependencies/impacts, risks and opportunities in the location may vary depending on the biomeand ecosystem.

The level of time commitment required for implementation is appropriate.

NeutralComments

The level of time commitment required for implementation is not clear.

The guidance supported us in scoping our assessment.

Disagree5Comments

Questions
Comments

For financial institutions, it is difficult to determine the scope of assessment using this guidance, because their respective business activities
contain a complex range of nature-related risks from various clients.

The guidance supported for the Locate phase is relevant and appropriate.

NeutralComments

While we believe that the guidance is relevant and appropriate, it is difficult to select a tool that is suitable for each company, because theguidance only gives us a list of some analysis tools.

The guidance helped us better understand and evaluate impacts.

NeutralComments-The guidance helped us better understand and evaluate dependencies.

NeutralComments

It is necessary to develop guidance for measuring dependencies qualitatively in the future.

The supported us to prioritize impacts.

Disagree

Comments

In order to prioritize, it is necessary to develop a method to measure impacts qualitatively.

The supported us to prioritize dependencies.

Disagree

Comments

In order to prioritize, it is necessary to develop a method to measure dependencies quantitatively.

The guidance supported us to better understand and integrate data on the state ofnature / pressures on nature (thresholds & allocations)

NeutralComments-The guidance supported us to better define and prioritize nature-related risks andopportunities.

Disagree

Comments

Since the nature-related risks and opportunities cover a very wide area and specific indicators for each risk and opportunity are not clear, it is
not possible to compare different types of nature with the same indicators, and it is difficult to prioritize them.

The guidance enhanced our capacity to translate nature-related risks into financialrisks.

Disagree

Comments

In order to reach the stage where it can be quantified, it is necessary to develop indicators for each nature-related risk and opportunity.

The guidance supported us in identifying new nature-related risks.

Yes

6Comments

Questions
Comments

The presentation on the definition of nature of interest and the risk identification tool for each definition helped to some extent in identifying
nature-related risks.

The guidance supported us in identifying new nature-related opportunities.

No

Comments

The identification of opportunities also needs to be more sophisticated hereafter.

The guidance enhanced our capacity to act on nature-related opportunities.

NeutralComments-The guidance supported in evolving our business model and strategic thinking, awayfrom nature negative outcomes and towards nature positive ones.

NeutralComments

We would like to see examples of qualitative or quantitative indicators for measuring what makes a cashflow nature positive. We also believethat consistency with the Global Biodiversity Framework is needed.

The guidance supported in shifting resource allocation.

Disagree

Comments-The guidance supported us in preparing for disclosures.

NeutralComments

With regard to the disclosure of natural capital and biodiversity, it seems that a certain sense of direction has been indicated.

The guidance supported us to better engage with key stakeholders around naturerelated issues.

NeutralComments-The guidance supported in evolving our collaboration with peers and unlikely allies,
around attaining nature positive outcomes.

NeutralComments-Metrics
The framework integrates well with metrics that are currently being used by myorganisation

NeutralComments-7Comments

Questions
Metrics included are clear, relevant and applicable

NeutralComments

The fact that assessment metrics have been provided is useful for future analysis. However, as the indicators that ought to be applied differ
depending on the client's business model, no metrics have been established to show nature-related risks and opportunities in an integrated
manner for financial institutions. In addition, the relationship between each assessment metric and the metrics that can be analysed byENCORE and other tools is not always clear, and it is hoped that this relationship will be made clear in the future.

The metrics provided help us enhance our management approach

NeutralComments-Are there any specific metrics or metric sets (i.e. standards) that should be included?

No

Comments-Targets
The framework integrates well with targets that are currently being used by myorganisation.

NeutralComments-Metrics included are clear, relevant and applicable.

NeutralComments

To apply metrics included to financial institutions, the establishment of tools and guidance for integrating client data is required.

The metrics provided help us enhance our management approach.

NeutralComments

In order for financial institutions to manage nature-related risks and opportunities, it is necessary to establish tools and metrics for managing
each indicator uniformly.

Are there any specific metrics or metric sets (i.e. standards) that should be included?

Yes

Comments

In order for financial institutions to manage nature-related risks and opportunities, it is necessary to examine indicators that integrate variousrisks.

Use Cases
Use cases provided are useful for my organisation to identify, prioritize and manage
nature-related risks and opportunities.

NeutralComments8Comments

Questions
Data on nature
The guidance provided on data sources is useful for my organisation in the assessment
Agreeand prioritization of nature-related risks
Comments

The presentation of data sources on nature-related risks by region and industry will likely be useful to some extent in assessing and prioritizing
nature-related risks.

The guidance provided on data sources allowed us to better understand the current
state of and pressures on natural capital.

Agree

Comments-Data on the state of nature and pressures on nature was available to perform theassessment.

NeutralComments

In the current absence of a global standard for confirming the changes in the State of Nature, we would like to see a future presentation that isbased on scientific data and that will allow comparison.
It is unclear whether it is possible to assess pressure on nature through loans by financial institutions.

Tools
Tools referred are useful for my organisation in the assessment and management ofnature-related risks and opportunities.

NeutralThe introduction of multiple tools seems to clarify the image of embarking on the assessment and management of nature-related risks andopportunities to a certain extent. On the other hand, it would be helpful for financial institutions to have specific guidance in the future on how
they should prioritise the use of each tool for analysis.

Comments

Regarding ENCORE, which is a tool used for the E (Evaluation) of the LEAP process, since financial institutions are involved in many projects
across multiple industries, we would appreciate it if we could extract various types of information in Excel based on the classification of thelevel of risk (Very High, High, Medium) instead of by industry. We would also appreciate it if the level of risk (Very High, High, Medium) for
each region could be similarly extracted using Excel.

Discussion Paper
How useful was this information?

Fairly useful

Please provide your feedback on the discussion paper(Required)-9