Towards an Integrated Transition Framework: Managing Risks and Opportunities at the Nature-Climate Nexus

The Integrated Risk and Opportunity Framework is a tool that financial institutions can use to structure their approach to transition to a net-zero and nature positive world, encompassing both risks and opportunities.

The tool enables financial institutions to bring together existing approaches to assessing, reporting and acting on climate- and nature-related risks and opportunities in an integrated way. In doing so, financial institutions can account for the material interactions between climate and nature, ensure their approaches to both transitions are aligned and accurate, and better manage their portfolios.

The framework builds on established climate frameworks to allow financial institutions to align strategies to seize opportunities and manage longer-term risks from both a net-zero and nature-positive transition; address interactions, such as the compounding and feedback effects between climate change and nature loss; and aggregate impacts by combining nature- and climate-related effects to assess financial impact.