HCV Screening and TNFD’s LEAP Framework: getting a good start in identifying and managing nature-related risks

With the release of TNFD’s finalised Recommendations for nature-related risk management and disclosure, the call for structured and demonstrable action by business and finance to avoid activities that have a detrimental effect on the global environment, nature and associated livelihoods, has once again grown louder.

Taking meaningful steps to prevent harm in places where an organisation has direct presence is daunting, let alone where there are finance, upstream, or downstream assets with no direct organisational control. There’s a multitude of factors to consider. That’s why TNFD’s Framework maps out coherent steps that break the task into manageable pieces, giving momentum to how to set in motion the informed decision-making needed to halt and eventually reverse the loss of nature.

Identify values, set priorities

TNFD’s LEAP Framework begins with a look at what it terms the “nature interface”. If a business or potential investor clearly understands where they risk an unwanted impact, they are in a better position to make decisions to control that impact, and take alternative actions to drive positive outcomes instead.

But how do you get a picture of this interface with nature without drowning in academic or technical detail? Many tools and services exist to help ensure the most significant risks are identified, and among one of most widely utilised approaches to inform action is the identification of High Conservation Values – commonly referred to as “HCVs”. An HCV is a biological, ecological, social, or cultural value of outstanding significance or critical importance. This suite of values includes rare, threatened, or endangered habitats and ecosystems, large landscape scale ecosystems, and intact forest landscapes, and nature’s contribution to people. TNFD’s launch highlighted new strategy disclosure recommendations on “priority locations” – defined by criteria for sensitive locations, which the work of identification of HCVs already enables.

The HCV Network (HCVN) provides tools and guidance especially designed to inform the actions of business and finance as they commit to avoiding the loss or degradation of critical environmental and social assets. In fact, the tools are informed by the practical experience of the commodity producers and standards, technical service providers, and NGOs, and continuously improved through piloting, consultations, and active use. Today, many commodity producers have taken or are undertaking site level assessments of HCVs. These HCV assessments can be leveraged as they provide insights into managing core environmental and social values which is pertinent to the TNFD framework as organisations look to understand risks and opportunities.

Already referenced by TNFD and other initiatives like the Science Based Targets for Nature, and Accountability Framework initiative, as well as global sustainability standards, HCV tools are well placed to enable practical action by those organisations stepping up to help meet the global goals and considering acting against the TNFD LEAP framework.

Screen rapidly, gain insights, plan actions

One HCVN tool to consider first when taking action on LEAP is HCV Screening. Whether individually or collectively, producers, buyers, and other stakeholders can use HCV screening to establish the probability of HCVs in a given landscape or location, identify threats to those HCVs, and work out a priority for their further follow up, full assessment, protection, management and monitoring.

Using the HCV Approach for the LEAP Framework

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LEAP’s first step is to Locate the interface with nature, and sub steps L1 to L4 ask: L1 Which biomes and ecosystems do these activities interface with? L2: What is the current integrity and importance of the ecosystems at each location? L3: Priorities according to the integrity and relative importance of relevant ecosystems? This step concludes with L4: Identification of priority nature-risk locations by sector, business unit or value chain.

HCV Screening provides answers to these questions due to the very nature of HCVs, and  having been purposely built to answer “what are the potential HCVs in this region?”, “where are these values located?”, and importantly “who are the users of these values?”. Where organisations are at the start of assessing the impact of their operations, screening also shows where gaps in information require further follow up, gives a picture of risks and threats, and signals priorities.

Moving on through the LEAP Framework, to Evaluate priority dependencies and impacts and Assess material risks and opportunities, HCV screening provides a description of risk - risk profile or footprint - in the landscape that the organisation is operating in, and prioritises where further investigation is needed in the Framework’s E, A and P steps. By asking “what are the existing threats to the values?”, “what area is needed to maintain the values?”, and more broadly “how should landscapes be managed?” we reach risk and opportunity identification, see possibilities for coordinated effort and collaboration, and build a realistic picture of what is required in risk management efforts.

Undertaking a screening process can serve as a tested, cost-effective, and rapid approach to identify the nature interface at any scale, context, or commodity, whether under certification or not - providing analytical insights to get organisations as clear as possible in their identification of priority nature-risk locations. This also helps avoid undertaking potentially costly, detailed assessments in places where risks are low, and ensure high risk scenarios are given the attention they deserve.

The groundwork to LEAP’s Prepare to respond and report, is set up through establishing priorities and asking “what needs to be monitored?”, “how will monitoring be done?” and “how will the results of monitoring be used?”. This informs organisational strategy and resourcing, target setting and performance management, and makes sure there is a strong feedback loop between actions taken, outcomes, follow up assessments, targeted field work and consequent impact reporting.

Planning of more detailed assessments to pin down where specific action is needed to prevent environmental and social loss or harm feeds into the LEAP Prepare step, when organisations are setting their strategy and targets. This is where full HCV Assessments can be planned to provide definitive maps of these critical values, and make recommendations for their protection in collaboration with local stakeholders.  In high risk settings, credible quality assurance of HCV Approach implementation through the use of licensed assessors under HCVN’s Assessor Licensing Scheme, leads to publicly accessible HCV assessment reports. While several sustainability schemes require the HCV Network’s quality assurance to ensure produce certificated to their production standards is maintaining HCVs, this is particularly helpful for high risk-sectors and commodities where certification is still limited, such as in soy, cattle and natural rubber.

Ensuring people are part of the process

Another element emphasised in TNFD’s recommendations launch for business and finance was the engagement of Indigenous Peoples and Local Communities, and affected stakeholders. HCVN tools build in the social engagement steps essential for credible risk assessment and subsequent decision making on the most appropriate actions to take. No business or investor is completely separate to the people and communities where an operation is taking place, and to their issues and concerns. The important elements of this can be evaluated right from the screening of a landscape, and in more explicit detail for a site. Developing greater social engagement and input often is the missing link to making positive change happen and last.  By building shared understanding with local communities and stakeholder groups of what values might be at risk, formally identifying the benefits they are providing, and coming to agreement on what needs to be protected, builds trust and helps find better long-term solutions. And it doesn’t end there, as the  critical role of management and monitoring is where local stakeholders can play a meaningful role in ensuring robust outcomes, accountability and transparency. The HCVN’s Forest Integrity Assessment tool – or FIA, readily adapted to different locations, is one example of how great data and knowledge can be gathered in collaboration with communities, to inform business activities.

Protecting what we rely on

Promoting the protection of High Conservation Values as part of the LEAP Framework makes sense. The six categories of HCVs are key to a healthy planet and society: species diversity, landscape level ecosystems, habitats, ecosystem services, community needs and cultural values. The consequent financial losses of these to society and to the global economy are also starting to be realised. They are not just a “nice to have” part of our world.

We urgently need more and more businesses and investors to halt the loss of nature and take action to bring about positive change. HCVN encourages the wide uptake of the LEAP Framework and calls for stakeholders to discover what tools, approaches and experience are already there and can help them contribute to the Global Goals and build a greener, fairer, better world by 2030. The more organisations stepping up to the TNFD Adoption campaign, the faster we will see the changes we need unfold.

Through the breadth of its work in different locations, contexts, scales and commodities, HCVN understands that approaches that build understanding, set priorities, frame action, are the ones that add to measurable positive change and impact.

The Economist recently wrote “Don’t let fear of imperfection stop you from taking action on nature and biodiversity—frameworks, standards and technology are here to help”.

Find out more about HCV screening, HCV assessments and HCV quality assurance as ready-to-use tools to help with your LEAP framework commitment. We welcome you to get in touch via secretariat@hcvnetwork.org and to read more about our work and find further HCVN resources online.