NatureFinance has launched the first tool called NatureAlign in an effort to align the investment portfolios of financial institutions towards nature-positive outcomes. It draws its inspiration from the Kunming-Montreal GBF, formerly the Biodiversity Plan. Launched in 2019 under the banner of The Finance for Biodiversity Initiative, NatureFinance was set up to focus attention on biodiversity in financial decision-making, further aligning international finance with nature conservation.
The tool starts with the launch of a single module that will assist private financial entities, such as banks and asset managers, in assessing their baseline position vis-à-vis environmental and sustainability goals. NatureAlign provides an integrated view of multiple datasets that allow portfolio-level assessments and actions, offering a thorough view. Compared to most tools that analyze mainly aspects like water scarcity or biodiversity, NatureAlign comes with an integrated platform, through which an individual can pinpoint the actual areas for potential adjustments. It is also notable because one of the few free resources that can directly connect with the Corporate Sustainability Reporting Directive (CSRD) and the Taskforce on Nature-related Disclosures (TNFD) LEAP framework.
The module allows users to upload some data about their investments and loans, which the tool then processes through biophysical, spatial, and financial data derived from third-party sources. One of the largest data points is the SEED Biocomplexity Index from ETH Crowther Lab, which is an asset not available in other tools. Results are produced rapidly by NatureAlign: maps and statistics highlighting the state of nature in places where the organization invests, along with water scarcity levels and ecosystem protection. The tool identifies sectors in portfolios that are exposed to nature-related risks so users may make informed targeted interventions.
Julie McCarthy, CEO of NatureFinance, said that there is an imperative need for financial institutions to change course and invest in nature-positive initiatives. As the global financial system continues on its unsustainable warming trajectory, it is in the nature of financial entities to transform the economic landscape by addressing nature risks and searching for nature-positive opportunities, said McCarthy. NatureAlign, she concluded, is designed to offer financial institutions a powerful tool to align investments with environmental, social, and governance goals.
Her statement, “The development of NatureAlign was a collaborative effort of over fifteen financial institutions.” She further assures that the organization is committed to perfecting it with continuous feedback so that such a tool serves users in furthering their nature-positive impact tracking.
As global finance becomes increasingly focused on ESG and biodiversity goals, tools such as NatureAlign create an accessible pathway for financial institutions to measure and improve their nature-aligned outcomes-joining a transition toward a more sustainable world economy.