In November 2022, the Global Reporting Initiative (GRI) launched a consultation on the latest draft of their biodiversity disclosure standard. The draft standard extensively updates the 2016 version (GRI 304) and is designed to assist companies report on their impact on nature. According to research published last year, less than half of the 5,800 largest global companies (made up of the largest 100 companies by revenue in 58 jurisdictions) report on biodiversity. To the extent adopted in a particular jurisdiction, the revised draft would require nature-related reporting on the organization’s activities and on its suppliers’ activities with the most significant impacts on biodiversity, “not all impacts.” The proposed standard also now includes additional disclosures to “report on the direct drivers of biodiversity loss” and emphasizes the importance of location-specific data to ensure greater transparency on the impacts on biodiversity. The consultation recognizes that it “can be challenging for many organizations” to report on biodiversity impacts, and the “upcoming biodiversity frameworks, such as the Science Based Targets Network (SBTN) and the Taskforce on Nature-related Financial Disclosure (TNFD) are developing methodologies to assist organizations to identify and prioritize the location of their most significant impacts.” The consultation is open for comments until February 28, 2023 and the expected publication date for the final updated standard will likely be in the second half of 2023.

Judy Kuszewski, chair of the Global Sustainability Standards Board, which is responsible for establishing the GRI Standards, stated that the updated standards will “provide the internationally accepted best practice for transparency on biodiversity impacts.” Furthermore, she stated that “I encourage all stakeholders and interested parties to participate in this consultation, because we need a standard that will be the global focal point for accountability on biodiversity impacts. Improved reporting – across sectors, regions and supply chains – is crucial for addressing information gaps and informing global solutions.”

Taking the Temperature: As we previously noted, the recently concluded COP15 in Montreal went a long way toward cementing nature and biodiversity concerns as a permanent feature of the sustainability discussion. Almost 200 countries adopted the Kunming-Montreal Global Biodiversity Framework and made funding commitments to achieve the Framework’s goals. Likewise, biodiversity concerns have received increased attention from regulators, standard setters and lawmakers. The GRI standards complement these efforts by attempting to “represent internationally agreed best practice and [to] align with recent developments and the relevant authoritative intergovernmental instruments in the field of biodiversity.” As we have advised, directors and management should take these and other relevant standards into account, including the SBTN and TFND, in determining appropriate disclosure for their organizations, and the governance procedures necessary to develop the information that may be subject to disclosure.