Op-ed by Juanjo Mestre, Founder and CEO of Dcycle.
The ISSB’s decision to integrate the Taskforce on Nature-related Financial Disclosures (TNFD) into its global standards marks a major turning point for sustainability reporting.
It’s really positive to see that nature and biodiversity are no longer positioned as optional or secondary considerations alongside climate. They are making their move into the category of financial risk, subject to the same level of scrutiny, rigour and expectation.
For European companies already navigating CSRD and ESRS requirements, this shift reinforces a reality many have been anticipating for some time; sustainability cannot be managed in silos. Climate, nature, supply chains and financial performance are all internally connected, and regulators are increasingly treating them as such.
The ISSB’s move stands out as the signal of global convergence. Companies that operate across borders have had to deal with overlapping standards and disjointed frameworks.
The ISSB‘s decision to expand on TNFD rather than start from scratch with a parallel system demonstrates the reporting ecosystem’s increasing maturity and uniformity. It also suggests an understanding that alignment and coherence matter just as much as ambition.
Why nature loss now matters to investors and boards
More fundamentally, this decision places nature loss on equal footing with climate risk in the eyes of investors and regulators. That has direct consequences for how companies are valued and how long-term risk is assessed, influencing everything from access to capital and insurance pricing to due diligence and board-level strategy.
Primary ecosystem services such as water availability, soil health and biodiversity are no longer treated as externalities. They are now being recognised as material factors that will shape capital allocation and strategic decision-making.
This has led to a big mindset shift in many organisations. Sustainability is no longer a regulatory burden and a task to manage in response to new rules. Companies that create genuine value through ESG don’t do it because a directive forces them to, they do it because the market doesn’t wait. Banks, insurers, supply chains and buyers are already making decisions based on ESG criteria.
The challenge now is less about understanding what needs to be reported and more about how it can realistically be measured. Unlike emissions, nature-related risks are complex. They cannot be captured through a single metric or calculation. It requires scenario modelling, an understanding of dependencies across value chains, and the ability to link environmental impact to financial outcomes.
Data will become the deciding factor
Establishing a strong data foundation is where most businesses are still stuck. Without robust infrastructure, it becomes almost impossible to make calculated decisions. Fragmented systems, inconsistent data sources and manual processes make it difficult to move beyond high-level statements and towards meaningful insight.
When ESG data cannot be trusted, the problem goes far beyond reporting. It affects how investors assess risk, how lenders price capital and how supply chain partners make decisions. Only a small proportion (19%) of European sustainability and C-suite leaders say they fully trust their non-financial data. When reporting spans manufacturing, transport, packaging, suppliers and waste, the lack of a single, unified view undermines credibility and confidence.
Recent political decisions may tempt some organisations to slow down their sustainability efforts. From talk of scaling back reporting requirements to broader regulatory uncertainty, pressure is easing, and taking it literally would be a mistake. The world’s largest investors and supply chains continue to demand robust environmental disclosures, not because regulation requires it, but because it informs how resilience and long-term value are assessed.
Sustainability as a strategic lever
In that context, sustainability should be treated as a strategic lever rather than a compliance exercise. Better data enables better decisions as it reduces risk, improves efficiency and opens up new opportunities. It’s time for companies to invest in their ESG infrastructure and integrate climate and nature data into a single system of record, which will be far better positioned to withstand changing rules.
A first step for companies would be to manage their data proactively rather than reactively. When sustainability data is treated with the same discipline as financial data, teams gain control and clarity, and they can focus on analysing insights rather than chasing information at the last moment.
The ISSB’s integration of TNFD guidance makes it clear that nature-related risk is not a future concern but a present one. The sooner companies integrate nature-related data, the sooner they gain a strategic edge over competitors and regulatory changes.
Learn more about Dcycle at www.dcycle.io.
