ISSB proposes nonmandatory nature disclosure – pressure moun

The International Sustainability Standards Board has released an exposure draft for nature-related disclosure standards – but framed it as nonmandatory guidance. This is a significant step backward from what many institutions are demanding.

A mandatory requirement would force consistency across markets and prevent the selective disclosure that currently allows companies to avoid material biodiversity risks. Nonmandatory standards rely on corporate goodwill, which has proven insufficient for climate reporting – there's no reason to expect it will work for nature.

The draft addresses biodiversity risks and dependencies, acknowledging that nature loss represents a material financial risk for many sectors. Agricultural companies, extractive industries, and consumer goods manufacturers face direct exposure through supply chain disruption, regulatory penalties, and resource scarcity. Yet allowing firms to opt out of disclosure means investors won't see standardised comparability on these risks.

Some stakeholders are already pushing back. Asset managers and development finance institutions argue that mandatory requirements – aligned with EU taxonomy and emerging regulatory frameworks – are essential to prevent greenwashing and drive capital reallocation towards genuinely nature-positive business models.

The exposure draft phase presents a critical window. If the ISSB defaults to nonmandatory standards, it risks creating a two-tier market where only transparent companies report, while competitors exploit the disclosure gap. That outcome serves neither investors nor the ecosystems these standards are meant to protect.

The real question: will the ISSB treat nature disclosure with the same rigour it eventually applied to climate reporting, or repeat the early mistakes that let companies define their own climate transparency rules?

ISSB seeks feedback nature-related disclosure proposal

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