Another T[Fill-in-the-Blank]FD Framework in the Works – For People

Climate has the TCFD. Nature has the TNFD. People issues may soon have the TISFD Framework. Launched in early 2025, the Taskforce on Inequality and Social-Related Financial Disclosures (TISFD) is a global initiative to develop recommendations and guidance for businesses and financial institutions to understand and report on impacts, dependencies, risks and opportunities related to people. Beta Version 0.1 of the TISFD Framework was released for public feedback this week. We discuss the Framework in this post.

Beta Version 0.1 of the TISFD Framework was released on May 26. As noted above, the intent of the Framework is to help businesses and financial institutions identify and disclose people-related impacts, dependencies, risks and opportunities. The Framework aims to make these issues more visible to support better business decision-making, stronger investor insight and clearer accountability to stakeholders. The Framework also is intended to be relevant to regulators, policymakers, civil society and labor organizations seeking to understand, compare and influence how organizations manage people-related issues and their financial implications. Beta Version 0.1 discusses in detail the business case for people-related disclosures (Section 1).

Impacts, Dependencies, Risks and Opportunities

“Impacts” refer to the positive or negative effects an organization’s activities, products, services and business relationships have on people, including on their human rights and on inequalities between them. The TISFD notes that impacts may affect a range of stakeholders, including an organization’s own workforce, workers in the value chain, communities and consumers and end-users.

“Dependencies” refer to the reliance of organizations and societies on human and social resources and relationships. This includes access to skilled and healthy workers and the communities that provide a social license to operate, as well as stable societies with effective institutions and the public services that power a functioning economy.

Impacts and dependencies can give rise to financial risks and opportunities for businesses and financial institutions that may affect revenues, costs, asset values and access to capital. 

Beta Version 0.1 discusses further the conceptual foundations for understanding relationships between business, finance, people and inequality (Section 3).

The Disclosure Framework 

Aspects of the Framework will look familiar. Its organization tracks the TCFD and TNFD frameworks and it draws on the International Sustainability Standards Board Standards, Global Reporting Initiative Standards and CSRD European Sustainability Reporting Standards.

The Framework is intended to complement key international sustainability and financial reporting standards. It adopts a building blocks approach so that it can be used as a standalone framework and also to complement existing standards and practices.

Conceptual foundations

These present key concepts and definitions for understanding the interactions between people, businesses and financial institutions, including their connection with nature and climate.

Proposed general requirements

The disclosure recommendations are underpinned by five general requirements intended to ensure consistency, coherence and comparability across reporting entities.

Materiality: Organizations should disclose material information about their people-related impacts, dependencies, risks and opportunities. The TISFD’s recommendations have been designed to accommodate different definitions of materiality, including those used in existing sustainability and financial reporting frameworks and those adopted by different jurisdictions, to support consistency and interoperability. The Taskforce is explicitly inviting feedback on its proposed approach to materiality.

System-relevant information: Preparers should provide disclosures that meet the information needs of investors about people-related externalities relevant to system-level risks.

In this version of the Framework, the TISFD outlines a general approach and invites feedback. It is conducting research to identify a set of key drivers of impacts that may be particularly relevant to a large range of investors and may therefore warrant disclosure. This includes identifying and substantiating the pathways through which these drivers are connected to system-level risks. The TISFD envisages including this initial set of key drivers of impacts relevant to system-level risks in the next iteration of the Framework, together with identifying relevant metrics recommended for disclosure by preparers. It also plans to provide guidance on the pathways through which externalities accumulate to give rise to system-level risks and associated financial effects for investors.

Stakeholder engagement: Entities should describe how they have engaged with affected stakeholders, including through due diligence, reflecting the nature of each engagement and its purpose.

Scope: Preparers should explain the scope of their assessment and disclosures, the process to determine the scope and plans for further expansion.

Time horizons: Short-, medium- and long-term time horizons should be considered and their definitions disclosed by preparers.

Disclosure recommendations 

The TISFD Framework includes twelve draft disclosure recommendations across four pillars: governance; strategy; impact and risk management; and metrics and targets. This structure will look familiar to preparers that disclose in alignment with the TCFD or TNFD frameworks. 

The high-level pillar descriptions and disclosure items are indicated below. Like the TCFD and TNFD frameworks, the TISFD Framework goes into more detail on these items (Section 4.3).  

Governance

Disclose the entity’s governance of people-related impacts, dependencies, risks and opportunities.  

1. Describe the oversight of people-related impacts, dependencies, risks and opportunities.

2. Describe management’s role in the governance processes, controls and procedures used to monitor, manage and oversee people-related impacts, dependencies, risks and opportunities.

3. Describe the entity’s approach to stakeholder engagement on people-related impacts, dependencies, risks and opportunities and how the perspectives of affected stakeholders are incorporated into governance and management decision-making.

Strategy

Disclose the interaction between people-related impacts, dependencies, risks and opportunities and the entity’s business model and strategy, and related financial effects.

1. Describe the people-related impacts, dependencies, risks and opportunities the entity has identified.

2. Describe the interaction between people-related impacts, dependencies, risks and opportunities and the entity’s business model and strategy, and related financial effects.

3. Describe the resilience of the entity’s strategy and business model to people-related risks and opportunities.

Impact and risk management

Disclose the processes used by the entity to identify, assess, prioritize and monitor people-related impacts, dependencies, risks and opportunities. 

1. Describe the entity’s processes to identify, assess and prioritize people-related impacts, dependencies, risks and opportunities in its own operations, upstream and downstream value chain(s). 

2. Describe the entity’s processes to monitor people-related impacts, dependencies, risks and opportunities.

3. Describe how processes to identify, assess, prioritize and monitor people-related risks are integrated into and inform the entity’s overall risk management processes.

Metrics and targets

Disclose the metrics and targets used to assess and manage people-related impacts, dependencies, risks and opportunities. 

1. Disclose the metrics used by the entity to assess and manage people-related impacts and dependencies.

2. Disclose the metrics used by the entity to assess and manage people-related risks and opportunities.

3. Describe the targets and goals used by the entity to manage people-related impacts, dependencies, risks and opportunities and its performance against these.

The Framework currently does not include recommended metrics and targets. These will be developed later.

Priority areas for development

In addition to metrics and targets, priority areas for further development include identifying key drivers of impacts relevant to system-level risks and related pathways, identification and assessment guidance for businesses and financial institutions and scenario analysis. Additional work also will be undertaken to further support the approach to materiality and the interconnectedness of people, nature and climate. Section 5 of Beta Version 0.1 goes into more detail on areas for further development.

Implementation guidance also will be left to future editions of the Framework. Sector-specific guidance also will be considered in future updates to the Framework.

The Public Consultation

The Beta Version is open for public feedback. There is an interactive platform that enables feedback to be inserted directly alongside specific sections of the Framework. Feedback can be provided here. 

Stakeholders are encouraged to provide feedback on Beta Version 0.1 by July 31 via the online platform. Further consultations will occur before the Framework is finalized.

Timing

Feedback gathered through public consultation, piloting and technical collaboration will inform subsequent versions, with refinements and expansions planned through 2026 and 2027:

• Version 0.2: Late 2026

• Version 0.3: Mid-2027

• Final Framework: Late 2027

• Future work: Further guidance  

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