Strategic Shareholder Climate and Risk Financial Financial Barclays PLC 120 report information sustainability report Governance review review statements Annual Report 2022 Implementing our Climate Strategy (continued) TCFD Strategy Recommendation (b) We have been part of a TNFD pilot group led by Nature-related risk in financing From a biodiversity perspective, the annual Barclays nature-linked UNEP FI to test the draft TNFD Framework. As We include financing restrictions that seek to targets include a commitment to increase financing - Cairn Homes plc part of the pilot, we looked specifically at address nature-related risk within our position biodiversity net gain (BNG) across Cairn’s new agriculture and food in Europe, with a focus on Biodiversity Linked SLL statements on Forestry and Agricultural developments measured as a percentage of UK farming, in which Barclays has a significant Barclays Corporate Banking Sustainable Commodities, World Heritage Sites and Ramsar overall new homes commenced. BNG delivers presence. Product Group (SPG) provided support to Cairn Wetlands, and Climate Change. We continue to measurable improvements for ecology by Homes plc (Cairn) in the selection of We recognise the need for continuous review and monitor the ways in which we can protecting, enhancing and creating habitats in meaningful targets and indicators linked to improvement with regard to available data and strengthen our approach. For example, see page association with development and Cairn's certain sustainability performance targets. technologies, in particular noting the complexity 253 for details of our due diligence approaches approach includes a development-specific In July 2022, Cairn completed a refinancing of and challenge given the number of nature to climate change and deforestation. biodiversity programme that replaces or its €277.5m syndicate facility into a attributes and their associated metrics. We will improves the local biodiversity of each new We have continued to develop our sustainability linked term loan (SLL) and therefore continue to support the development Cairn development or otherwise contributes to understanding and ability to evaluate nature- revolving credit facility (RCF), one of the largest of methodologies which seek to better evaluate the improvement of Ireland’s biodiversity. related risk in financing, building on the work of its type arranged in the Irish homebuilding risk impacts and dependencies at a portfolio started in 2021. This included working with an sector, with AIB, Bank of Ireland and Barclays level. For example, we have trialled an emerging external expert on a materiality exercise to Bank Ireland. The term loan and revolving credit modelling methodology in order to support our produce an initial portfolio heatmap to analyse facility interest rates are linked to Cairn participation with the UNEP FI work, which draws nature-related risk by sector and exposure meeting certain sustainability performance upon a wide range of available data and also across our lending portfolio. This involved a targets on biodiversity, decarbonisation and its adopts assumptions where there are gaps. qualitative review of sector impacts and people strategy. Further details can be found in our position statements on dependencies across a number of key risk drivers + the Barclays ESG Resource Hub at: home.barclays/ representing both physical and transition risks, to sustainability/esg-resource-hub/ determine where in the portfolio were the likely Further details on our position statements can be found in the non-financial information statement from page 60. areas of highest risk. This involved assessing our clients’ locations in TNFD pilot with UNEP FI - European terms of production and sales and applying a Agriculture and Food Nature-related financing Life Under Water, as well as SDG 15, Life on number of biodiversity metrics to each location Land. Examples include a sustainability-linked In 2022, the TNFD published a draft version of While the market is at a relatively early stage, to determine where key impacts and risks may facility that includes biodiversity targets, as well its risk management and disclosure framework nature-related financing presents significant future arise. A number of different 2030 scenarios as investment by Barclays Principal Investments. for organisations to report and act on evolving opportunities for the financial sector given the were also used to stress the portfolio and nature-related risks. UNEP FI is piloting this capital requirements to address and reverse nature We seek to support impactful projects through our individual counterparties, to see whether framework with approximately 40 financial loss: the biodiversity financing gap is estimated to partnership with Blue Marine Foundation through material financial impact could arise as a result a institutions - Barclays is participating in their be in the region of $598-824bn per year . which Barclays has financed projects which help to of nature-related transition and physical risks. pilot group focused on European agriculture support the protection, restoration and The results are currently being reviewed At Barclays, we will continue to work towards and fisheries, which in the Barclays context sustainable management of the world’s ocean. internally to assess how they could be used green and sustainable finance targets which means agriculture and food sectors. alongside existing climate risk procedures. include financing relevant to nature and A breakdown of Barclays' sustainable financing, including As part of the pilot programme, we worked with + against the SDGs, can be found on pages 99 to 102. biodiversity. Details of Barclays Principal Investments team investment an external expert to test the draft TNFD This includes categories such as ‘sustainable in ECOncrete can be found on page 113. framework, including the proposed risk food, agriculture, forestry, aquaculture and assessment process (LEAP FI), on our Note fisheries’ in addition to financing that tracks a Paulson Institute, Financing Nature: Closing the Global Biodiversity agriculture and food portfolio in Europe, with a Financing Gap (2020) against Sustainable Development Goal (SDG) 14, focus on UK farming.