TNFD Locate Phase: Mapping Business Activities, Value Chains and Sensitive Locations

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

Nature-related dependencies and impacts occur in particular ecosystems, watersheds, landscapes and seascapes. A corporate group can therefore have the same activity in two locations but face very different dependencies, impacts and business consequences. Locate is the bridge between a high-level business inventory and the detailed causal analysis performed in Evaluate.

The phase is a prioritisation process, not a final materiality decision. A screening score indicates where detailed work is warranted; it does not by itself prove that a dependency, impact, risk or opportunity is material. The output should preserve enough context for the next phases to understand the activity, location, nature interface, evidence quality and reason for selection.

A credible map begins with a controlled span. The team should identify the legal entities and business units covered, but it must also describe the economic activities, products, processes and value chains that connect the reporting entity to nature. For a financial institution, the span can include financed, facilitated, investment or insured activities; for a corporate, it normally includes direct operations and relevant upstream and downstream activities.

Business model: principal revenue streams, operating processes, major assets, products and services.

Sectors and activities: use a consistent industry/activity classification and retain the mapping to internal business units.

Upstream value chain: raw materials, commodities, processing stages, strategic suppliers, contract manufacturers, energy and logistics.

Downstream value chain: distribution, customer use, product impacts, maintenance, disposal and end-of-life pathways where relevant.

Geographic scope: countries alone are rarely sufficient for location-sensitive questions; identify the intended progression towards sites, basins, landscapes or seascapes.

Assessment purpose: clarify whether the first pass is a whole-group screen, a commodity deep dive, a portfolio heat map, a disclosure readiness exercise or a decision on a specific investment.

L2 screening narrows the span to activities with potentially moderate or high dependencies and impacts. Sector and commodity tools can provide a useful starting point because they reveal typical interfaces that may not yet be visible in internal risk registers. The organisation should combine these external indications with its own scale, location, sourcing pattern, production method, incident history and stakeholder evidence.

High-impact commodities and unknown origins

Where a commodity is likely to carry significant nature interfaces, the organisation should not wait for perfect supplier traceability before including it. Record the commodity, volume or spend, supplier tier, known processing country, probable origin range, applicable ecosystem and sensitivity indicators, and the confidence attached to each field. Then decide whether a country, subnational region, landscape or facility is the best current spatial unit.

Unknown origin should be coded explicitly. A practical register can distinguish exact coordinates, verified polygon, supplier-declared site, catchment, landscape, subnational region, country, modelled origin and unknown. This prevents a country proxy from being presented as site-specific evidence and allows the team to target supplier engagement where improved traceability could change a decision.

For direct operations, asset-level coordinates or polygons are normally the starting point. The map should also capture the ecological unit relevant to the issue: a water withdrawal may need a catchment or basin; habitat fragmentation may require a landscape corridor; marine impacts may require a seascape; air or water pollution can move beyond the facility boundary. The relevant geography is therefore not always the legal property line.

The TNFD Recommendations describe sensitive locations through five non-exclusive criteria: areas important for biodiversity; areas of high ecosystem integrity; areas of rapid decline in ecosystem integrity; areas of high physical water risk; and areas important for ecosystem-service provision, including benefits to Indigenous Peoples, Local Communities and other stakeholders. A location can meet one or several criteria.

Sensitivity screening should therefore use more than a protected-area layer. It can include Key Biodiversity Areas and species information, ecosystem integrity and trend data, basin-level physical water risk, and evidence of ecosystem services that support communities and rights-holders. The selection rule, data date, spatial resolution and threshold should be preserved in the register.

Figure 1. Locate screening funnel and minimum location-register outputs. London Reporting Academy visual.

A map is a presentation layer; the register is the controlled analytical record. Each point, polygon or aggregated area should be linked to the underlying business activity and evidence. The register should allow a reviewer to understand why the location entered the assessment, which data were used, how precise the geography is and what needs to improve.