NatureFinance has launched NatureAlign, a tool aimed at enhancing financial institutions’ alignment with nature-positive outcomes, specifically through the Biodiversity Plan framework.
According to ESG Today, founded in 2019 as The Finance for Biodiversity Initiative, NatureFinance’s mission is to integrate biodiversity considerations more deeply into financial decision-making processes. This aligns global finance more closely with nature conservation and restoration efforts. NatureFinance is recognized for its commitment to addressing environmental and sustainability challenges through innovative financial solutions.
The impetus behind NatureAlign stems from the urgent need to address slow progress in environmental conservation and the misdirection of funds in terms of environmental impact. NatureAlign is designed to help financial institutions—from asset managers to banks—assess and improve their environmental strategies, promoting more sustainable economic activities.
NatureFinance operates with the goal of increasing the materiality of biodiversity in financial decision-making. Their new tool, NatureAlign, aggregates a unique combination of datasets, including biodiversity and water scarcity metrics, to facilitate portfolio-level analysis and action.
NatureAlign functions by allowing institutions to input data regarding their investments and loans into a watchlist. The tool then utilizes third-party biophysical, spatial, and financial data to provide comprehensive analyses, including maps and statistics that detail the state of nature and water risks associated with their portfolios.
Beyond initial assessments, NatureAlign offers links to crucial sustainability frameworks like the Corporate Sustainability Reporting Directive (CSRD) and the Taskforce on Nature-related Disclosures (TNFD) LEAP framework. This integration helps users identify potential areas for initiating environmental impact reductions and supports targeted actions based on the analysis outcomes.
Future prospects for NatureAlign include the development of additional modules that may provide tools or frameworks for further alignment with global biodiversity frameworks, structured recommendations for setting nature-related targets, and opportunities for organizations to examine the environmental impacts of modifying their investments.
Julie McCarthy, CEO of NatureFinance, emphasized the critical role of financial institutions: “With our financial and economic system currently on track for 2-3C warming, financial institutions, like asset managers, asset owners and banks, are crucial to redirecting finance towards economic activities that deliver nature-positive outcomes. Financial institutions can dramatically transform both the business and natural landscape by proactively managing nature risks and seeking out nature positive opportunities in their decision-making. Innovative, accessible tools and data are critical to help them know where, how and in what to invest on a rapidly changing planet. We urgently need financial institutions’ leadership to align global investment with an economy that works for nature, climate and people.”
Sarah Krisht, Nature Risk Lead at NatureFinance, added: “Our aim with NatureAlign is to develop a tool which is accessible and helpful in order to drive progress in their nature journey and better track their impact on nature. User needs are at the core of NatureAlign which is why we engaged with over fifteen financial institutions in developing it, and hope to continue this iterative engagement.”
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