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TNFD Prepare Phase: Responses, Targets, Governance and Disclosure Readiness

How to turn LEAP findings into mitigation, resource allocation, targets, approvals and a repeatable reporting cycle

Who this is for A 10-minute read for reporting teams working through Impact measurement, targets and nature-outcome claims, and for reviewers testing whether the evidence behind it holds.

Published passport

Current as at 10 August 2026
RK Reviewed by Dr Ross KurinkoLinkedIn Strategic ESG Advisor · IFRS S1 & S2 / GRI / ESRS expert GRI Certified Global Trainer · PhD, University of Cambridge · ESG-AI expert 15+ years on FTSE 100 & Fortune Global 500 disclosures Canary Wharf, London LRA educational guidance · Not issued or endorsed by TNFD

Edition written against

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Technical limitation: This article does not create a mandatory transition-plan requirement or prescribe a universal target …

Published

10 Aug 2026

Knowledge Hub guide

Last reviewed

10 Aug 2026

Short answer

The answer, before the reasoning

Prepare is the decision and reporting phase of LEAP, not simply the moment when the report is drafted. It converts material dependencies, impacts, risks and opportunities into response and resource-allocation decisions; sets controlled targets and performance measures; confirms governance and engagement; performs a disclosure gap assessment; obtains management and board approvals; and establishes a repeat cycle.

A response is not ready unless it has an owner, resources, timeframe, evidence, controls and a clear connection to the issue and priority location it is intended to address.

Educational practitioner material. TNFD recommendations and LEAP guidance should be applied to the organisation’s facts, stated materiality approach and reporting context.

Quick orientation

Quick orientation

Quick orientation
Practical answer
Applies to
Material and prioritised outputs from Evaluate and Assess, plus monitored items that require response or governance.
Primary decision
What will the organisation do, measure, approve and disclose - and how will progress feed the next LEAP cycle?
Key TNFD components
P1 strategy/resource allocation; P2 target setting/performance; P3 reporting; P4 presentation.
Core outputs
Response plan, resources, targets, controls, disclosure matrix, approval record and reassessment calendar.

Technical status

Current technical position

<p>TNFD’s 2025 guidance on nature in transition plans is additional guidance. It can strengthen P1-P4, but it does not mean that every TNFD reporter has a mandatory stand-alone transition plan. Disclose the plan, actions and assumptions that actually exist and avoid implying that an aspirational “nature-positive” statement is a complete plan or verified outcome.</p>

In practice

1. The four Prepare questions

Component Question Decision/output
P1 - Strategy and resources What risk-management, strategy and resource-allocation decisions should result from the analysis? Response hierarchy, business-model implications, investment/disposal, funding and accountable owners.
P2 - Targets and performance How will targets be set and progress defined and measured? Baselines/reference conditions, metrics, milestones, target governance and monitoring.
P3 - Reporting What will be disclosed in line with the TNFD Recommendations? Disclosure gap matrix, material information, priority locations, metrics, limitations and cross-references.
P4 - Presentation Where and how will nature-related disclosures be presented? Report architecture, connectivity, approval, publication controls and claim wording.

2. P1: select responses using the mitigation hierarchy and business strategy

The response should address the causal pathway identified in Evaluate and Assess. Managing only the financial consequence - for example buying short-term water supply - may leave the impact and underlying ecosystem decline unchanged. Conversely, a restoration project may not remove an operational dependency or residual financial risk. Prepare should distinguish impact management, dependency management and risk/opportunity management while showing how they connect.

In practice

Response level Purpose Illustrative actions — Control question
Avoid Prevent a negative impact or exposure before it occurs. Site or sourcing exclusion, redesign, no-conversion requirement, alternative process or location. — Has the root cause been prevented, and are displacement/leakage risks addressed?
Reduce Minimise impacts or dependency intensity that cannot yet be avoided. Water/energy efficiency, pollution prevention, lower-impact practice, supplier standard. — Is reduction measured against a clear baseline and relevant location?
Restore / regenerate Improve ecosystem function or accelerate recovery. Habitat restoration, soil regeneration, wetland recovery, catchment partnership. — Is the action additional, durable, ecologically appropriate and separately measured from continuing harm?
Transform Contribute to systemic change inside and beyond the value chain. Business-model innovation, landscape governance, finance, standards, policy engagement and collaborative infrastructure. — Are governance, safeguards, partners and claimed contribution credible?

Caution

Do not hide residuals

<p>Restoration or credits should not be used to present continuing negative impacts as if they have disappeared. Report negative and positive effects transparently and explain residual dependencies, impacts and risks.</p>

3. Resource allocation and ownership

P1 should be connected to the organisation’s normal strategy and finance cycle. Significant actions may require capital expenditure, operating expenditure, procurement changes, supplier/customer engagement, research and development, acquisitions or divestments, new data and technical skills, and changes to risk appetite or product design. Each action needs an accountable executive and operational owner.

In practice

Plan field Required content
Issue linkage DIRO ID, priority location, causal pathway and materiality/prioritisation conclusion.
Action Specific activity, response level, intended business and nature outcome, dependencies and trade-offs.
Owner and governance Accountable executive, delivery owner, data owner, oversight committee and escalation route.
Resources Budget, capex/opex, people, expertise, data, technology, partnerships and funding source.
Timing Start/end, milestones, dependencies, approvals and trigger for redesign.
Evidence and controls Baseline, methodology, source records, quality controls, review and assurance readiness.
Residuals Remaining impact, dependency and risk; limitations; contingency or adaptation plan.

4. P2: design targets that can be managed and evidenced

A useful target is tied to the issue, location and pathway. Global ambition can provide direction, but it does not replace operational targets and milestones. The organisation should identify whether the target addresses an impact driver, state of nature, ecosystem service, dependency, risk, opportunity or response activity and avoid presenting an activity target as an outcome target.

Weak versus stronger target wording

In practice

Target element Questions
Boundary and location Which entities, activities, products, value-chain stages and priority locations are covered?
Baseline/reference condition What starting point and ecological reference are used; why are they appropriate; has the basis changed?
Metric and method What indicator measures driver, state, service, risk or response; what unit and methodology apply?
Timeframe and milestones What short, medium and long-term dates and interim milestones support management?
Level and rationale What outcome is intended; how was ambition determined; what thresholds, science or stakeholder evidence inform it?
Resources and dependencies Which actions, capex/opex, suppliers, partners, policy conditions or data improvements are needed?
Governance Who approves, owns, monitors, challenges and may revise the target?
Performance and limitations What progress is achieved; what is off-track; what estimation or coverage gaps remain?

In practice

Weak Why weak Stronger structure
“Become nature-positive by 2030.” Undefined boundary, baseline, outcome, metric, location, actions and accountability. State the covered activities and priority locations; baseline/reference condition; separate driver/state/response metrics; milestones; owner; resources; residual impacts; limitations and review.
“Restore 1,000 hectares.” Area alone does not show ecological condition, additionality or durability. Define habitat, location, reference condition, restoration method, condition/outcome indicators, safeguards, permanence, monitoring and relationship to continuing impacts.

5. P3: perform a disclosure gap assessment

The Prepare team should map the approved assessment and response record against all 14 TNFD recommended disclosures and the general requirements. The gap matrix should identify whether information is available, material, controlled, approved and connected to the report. It should distinguish a genuine non-material conclusion from unavailable data and from information that exists but is not yet publication-ready.

A practical gap-status taxonomy

Figure 1. Prepare response, target, disclosure and repeat cycle. London Reporting Academy visual.

In practice

Disclosure area Readiness questions
Governance Are board oversight, management roles, mandates, information flows, skills and engagement with IPLCs/affected stakeholders evidenced?
Strategy Are material DIROs, time horizons, business-model/value-chain effects, financial planning, resilience/scenarios and priority locations addressed?
Risk and impact management Are direct-operation and value-chain identification/assessment processes, management responses and integration with overall risk management described?
Metrics and targets Are risk/opportunity metrics, dependency/impact metrics, core global/sector metrics, targets, baselines, progress and limitations controlled?
General requirements Is the materiality approach, disclosure scope, location approach, integration, time horizons and stakeholder engagement basis clear?
Presentation and claims Are cross-references precise, omitted metrics explained, illustrative wording removed, claims approved and report location controlled?

In practice

Status Meaning Required action
Ready Material information exists, is controlled, approved and publication-ready. Final consistency and sign-off.
Ready with estimation Information is material and estimated using an approved method. Disclose method, assumptions, uncertainty and improvement.
Data gap Information is relevant/material but unavailable or not measurable. Explain limitation and improvement plan; do not invent precision.
Process gap The underlying assessment, control, governance or engagement has not been completed. Remediate the process; narrative alone is insufficient.
Not material Assessed under the stated materiality approach and not material for disclosure. Retain rationale and monitoring trigger.
Not applicable Disclosure element genuinely does not apply to the organisation or issue. Document basis; avoid using this status for inconvenience.

6. Governance, approval and assurance readiness

Management and the board should see the important judgements before the final report is complete. Approval papers should explain the materiality approach, priority locations, major data limitations, significant response and investment decisions, target credibility, financial implications and proposed disclosure claims. Legal, finance, risk, sustainability, technical specialists and internal audit or assurance teams should challenge the evidence appropriate to their roles.

In practice

Approval gate Evidence
Method and scope Approved LEAP scope, materiality lens, value-chain breadth, location approach and key assumptions.
DIRO decisions Longlist/shortlist, thresholds, overrides, uncertainty, financial-effect analysis and owner.
Response and resources Action plan, budget/capex, accountable executives, dependencies and residuals.
Targets Boundary, baseline/reference condition, metrics, methodology, milestones, performance and limitations.
Disclosure Completed matrix, source/claim ledger, cross-reference map and consistency with other reports and public commitments.
Controls/assurance Data lineage, evidence register, model/version control, review findings, remediation and representation.
Claim approval Exact TNFD/alignment wording, scope, reporting period and limitations approved by legal/technical governance.

7. Repeat LEAP rather than treating it as a one-off project

Nature interfaces, ecosystems, supply chains, regulation and stakeholder expectations change. The organisation should define annual and event-driven triggers for refreshing Locate, Evaluate and Assess. A major acquisition, new site, supplier-origin change, permit event, ecosystem threshold, new data source, missed target, material incident or change in strategy can require reassessment before the normal annual cycle.

Monitor impact drivers, state-of-nature and ecosystem-service indicators alongside risk and response metrics.

Review whether assessment and priority locations still reflect the business and value chain.

Update evidence quality, supplier traceability and model versions.

Reassess residual risks and financial effects after controls or ecosystem conditions change.

Escalate target deviations and revise actions transparently rather than silently changing the baseline.

Update disclosures, maps, visual assets, AI-ready records and cross-framework mappings when source guidance changes.

Hypothetical scenario

Illustrative scenario

<p>A developer identifies a project near a degraded wetland that provides flood regulation and community benefits. Assess identifies physical flood risk, permit and reputation transition risk, and an opportunity to redesign the site. Prepare selects avoidance of the most sensitive area, reduced sealed surface, wetland restoration and a long-term maintenance partnership. Finance approves design capex and contingency; the target specifies the project boundary, reference condition, hydrological and habitat metrics, milestones and owner. The disclosure matrix links the priority location, strategy change, financial planning, stakeholder engagement, metrics and residual uncertainty. The board reviews the judgement before planning approval and again before publication.</p>

Illustrative only. It shows how the decision is made, not wording that can be copied or relied on.

In practice

9. Common mistakes and corrections

Mistake Risk Correction
Selecting actions before confirming the pathway Resources address symptoms or create trade-offs. Link each action to the DIRO and intended outcome.
Global target with no location or boundary Progress cannot be managed or verified. Specify covered activities, priority locations, baseline, metric and milestones.
Claiming “nature positive” from activity metrics An aspirational claim is presented as an outcome. Use precise, evidenced claims and disclose residual impacts and limitations.
No budget or accountable owner Action remains a sustainability narrative. Integrate capex/opex, resource and governance decisions.
Treating a disclosure gap as a drafting problem Underlying process/data gaps remain. Classify and remediate data, process, control or governance gaps.
Board sees only final wording Key judgements are not governed. Use staged approval gates for method, DIROs, actions, targets and claim.
Assurance starts after publication Evidence defects are found too late. Run pre-assurance evidence requests and control testing during Prepare.
LEAP performed once Maps and conclusions become stale. Set annual and event-driven reassessment triggers.

Readiness

10. Prepare disclosure-readiness checklist

  • Material and prioritised DIROs have accountable owners and links to priority locations.
  • Responses follow a documented hierarchy and address both root causes and residual risk.
  • Actions have approved resources, timing, dependencies, safeguards and evidence requirements.
  • Targets define boundary, location, baseline/reference condition, metric, timeframe, milestones and owner.
  • Negative and positive impacts, restoration and residuals are not inappropriately netted.
  • Governance and stakeholder/rightsholder engagement are evidenced, not only described.
  • All 14 recommended disclosures and general requirements have been gap-assessed.
  • Data gaps, estimation, non-material conclusions and process gaps are separately classified.
  • Financial effects and resource allocation are connected to budgets, forecasts and capital decisions.
  • Claim wording, cross-references and report placement are approved.
  • Controls, evidence and models are ready for internal review or external assurance as applicable.
  • Annual and event-driven triggers repeat the LEAP cycle and update disclosures.

Take it with you

The checklists as a working spreadsheet

Every checklist and table on this page, with empty status, owner and evidence columns for your team to fill in and keep.

Download .xlsx

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