Picture a textile mill on a river. Nature-related reporting asks four simple questions about it.
1. What do we depend on?
The mill needs a steady supply of clean water for dyeing and rinsing. That is a dependency on an ecosystem service.
2. What do we affect?
Wastewater with dyes and chemicals goes back into the river; water is drawn out in dry months. Those are impacts on the state of nature.
3. What could go wrong for us?
- Physical risk: drought cuts water supply and halts production.
- Transition risk: stricter discharge permits or water pricing raise costs.
- Reputational and legal risk: pollution incidents, community complaints, buyer delisting.
4. Where is it happening?
Nature is local. The same mill would face very different risks on a healthy river and on a stressed one. That is why nature assessments start with location.
The LEAP approach
The TNFD's LEAP approach turns this into a process: Locate your interface with nature, Evaluate dependencies and impacts, Assess risks and opportunities, and Prepare to respond and report.
Where it shows up in reporting
Under the ESRS, water sits in E3 and biodiversity and ecosystems in E4, each reported if material. The ISSB decided in May 2026 to take nature disclosure forward building on TNFD material, so the same thinking is spreading to ISSB-based regimes.
Last checked 12 October 2026. Educational content, not legal advice.