The Nature Conservancy

“The Form 990 is prepared, based on financial statements audited by PricewaterhouseCoopers, and other internally generated information by the Conservancy's Director of Tax Services. The Form is further reviewed by the Conservancy's Internal Audit Department (which provides independent verification of certain information) and members of Senior Management. As outlined in its charter, the Audit Committee then reviews any significant issues or judgments relating to disclosures in the Conservancy's Form 990. Finally, copies are provided to the full Board of Directors for their comment prior to filing with the IRS.”

“The Nature Conservancy's monitoring and enforcement of its conflicts policy is governed by its Conflict of Interest Standard Operating Procedure ("SOP") which is excerpted as follows: Before engaging in any activity on behalf of the Conservancy, staff must determine (a) whether the activity could give rise to a conflict of interest or the appearance of a conflict of interest, and, if so, (b) whether the conflict can or should be avoided to protect the best interests of the Conservancy. If it is not reasonably possible to avoid a conflict of interest or the appearance of a conflict of interest, or it is not in the Conservancy's best interest to do so, staff must determine appropriate strategies to mitigate and manage the potential adverse consequences of the conflict and obtain approval, as described below, prior to engaging in the activity. A conflict of interest exists when an individual who is responsible for acting in the best interests of the Conservancy has another interest or loyalty that could influence or impair, or may appear to influence or impair, the individual's ability to act in the best interests of the Conservancy. As used throughout the SOP, the terms "conflict" and "conflict of interest" include: 1. actual conflicts of interest; 2. potential conflicts of interest (situations that could become actual conflicts in the future based upon foreseeable events or the passage of time); and 3. perceived conflicts of interest (situations that others could reasonably perceive to be, or have the appearance of, a conflict of interest). Generally, conflicts can arise from relationships between the Conservancy and staff, Board members, trustees and advisors, and the families of all those groups. There are very specific rules regarding who is a "covered person" that are governed, in great part, by the U.S. Internal Revenue Service requirements for public charities. If a conflict of interest is identified which cannot reasonably be avoided or it is not in the best interest of the Conservancy to do so, before proceeding with the proposed activity, review and approval to proceed must be obtained as described in this section. While a request for approval of a proposed course of action is pending or being considered, the transaction or activity cannot proceed. A. Board and Key Employee certifications. All Conservancy Board members and key employees shall annually certify that they have read the Conflicts of Interest Policy and have disclosed all conflicts. B. Supervisor Approval Required. In the case of staff, prior to submission for review and approval to the Conflicts Committee the conflict of interest must be raised to the individual's supervisor and the supervisor must make the determination that he or she (a) wishes to pursue the proposed activity and (b) approves the recommended course of action and proposed mitigation as sufficient. Signature on the Approval form indicates this approval. Regional level approval also is required. C. Conflicts Committee Review Required. The Conflicts Committee reviews and makes determinations about conflicts of interest involving the Conservancy, unless excepted by this SOP. See Conflicts of Interest for the Conflicts Committee charter, meeting schedule and list of Committee members. Staff must submit a Request for Conflicts Committee Approval form to the Conflicts Committee when seeking review and approval. The form should explain why the conflict cannot or should not be avoided and recommend a course of action designed to minimize the conflict's potential adverse consequences. By submitting the form, both the person submitting the form and his/her supervisor (a) are responsible for ensuring that the form makes a thorough disclosure of the relevant information, and (b) are deemed to support and be responsible for the recommended course of action. The appropriate Conservancy attorney may be consulted to assist in analyzing the conflict. Board Members and Trustees should contact the Conservanc”

“Review Process for Officer and Key Employee Compensation: The President and Chief Executive Officer's, as well as, members of the Executive Team's performances and compensation are reviewed annually by the Board of Directors. The performance and compensation of all other Key Employees is reviewed annually by their direct supervisor. All compensation amounts are based on information provided by an independent compensation consultant who utilizes comparable data from Form 990's from other organizations and compensation survey's and studies to ensure reasonableness.”

“The Nature Conservancy's governing documents, conflict of interest policy, and financial statements are available to the public via our website: nature.org.”

“LANDS Brazil's Amazon Basin. Engaging agricultural producers and indigenous communities to stem the loss of forests. The conservation of such a vast and globally important resource as the Amazon Basin requires coordinated strategies that recognize the natural values of forests, the cultural importance of land tenure and the economic realities of agricultural commodities. Brazil's progressive Forest Code requires Amazon landowners to maintain native forest cover on between 50 and 80 percent of their land, but until fairly recently, the requirements were widely ignored. By demonstrating win win solutions for production and protection in areas where the deforestation threat is greatest, Nature Conservancy innovation is enabling compliance with the Forest Code, while increasing economic opportunity. We are also working with indigenous peoples to integrate traditional knowledge with modern approaches to landscape planning in order to enable greater leadership in deciding how their traditional territories will be managed and to have a stronger voice in policy decisions. At the same time, the Conservancy is developing a blueprint for the basin of the Tapajos River, a major tributary of the Amazon, using tailor made geospatial tools and models to help guide Brazilian environmental and natural resource agencies in decisions regarding dams and other development. Western Checkerboard Deal, United States. To encourage the railroads to expand west in the 1860s, the U.S. Congress gave away every other square mile of land, creating a checkerboard pattern of private and public ownership. With the launch of the Great Western Checkerboard Project, The Nature Conservancy will help conserve the ecological integrity of 257 square miles of forests, rivers and wildlife habitat in the eastern Cascade Mountains of Washington and in the Blackfoot River valley in Montana. Through NatureVest, the Conservancy and other investors used interim financing to acquire the lands, stitching together these important migratory corridors that link up through Canada. Loisaba Conservancy, Kenya. Nature Conservancy donors provided 9 million dollars to transfer a 56,000 acre private property in northern Kenya into the holding of a newly formed conservation trust. This transaction maintains an important wildlife corridor for elephants, protects habitat for 260 bird and 57 mammal species, and supports jobs, schools, health clinics and sustainable grazing options. Combined with adjoining lands of Conservancy partners Lewa Wildlife Conservancy and Northern Rangelands Trust, the Loisaba addition brings conservation management in the area to more than 10 million acres, about the size of Denmark. Martu Living Deserts, Australia. The Nature Conservancy is supporting an unprecedented effort to conserve part of the world's most intact desert in Western Australia. Spanning an area larger than the state of Mississippi, the Martu Living Deserts Project is an innovative collaboration between the Conservancy, global resource company BHP Billiton and local indigenous organization Kanyirninpa Jukurrpa. The project aims to sustainably manage and protect the lands and heritage of the Martu people, whose culture is one of the world's oldest. Combining modern science with traditional knowledge, indigenous rangers undertake fire and feral predator management, threatened species protection, and waterhole maintenance. Protected Areas, Mongolia. The Nature Conservancy has completed assessments of biodiversity, habitats and threats across the entirety of Mongolia. Already, more than 7 million acres of national and local protected areas have been established in critical places, bringing Mongolia's protected area network to 66 million acres, about the size of Colorado. At the invitation of the Mongolian government, the Conservancy is also now applying its Development by Design principles to guide land use decisions, including for mining and infrastructure development, in the Gobi Desert. WATER The”

“Continued from Line 4a. OCEANS Indonesia's Lesser Sunda Region. Managing waters for commerce and ways of life. Ocean waters surrounding the Indonesian archipelago are a rich source of natural diversity, food and livelihoods for local people and of commercial opportunities for fishing, shipping and tourism. Whales, manta rays and sea turtles traverse the same routes where commercial ships ply the waters and subsistence fishers eke out a living. Such increasingly busy waterways, here and around the world, demand a holistic approach to managing and maintaining their health and viability. The Lesser Sunda region offers an example of how The Nature Conservancy pursues the conservation of marine resources at a system wide scale with multiple partners. By combining traditional parks and marine protected areas with sustainable fisheries management and the strengthening of alternative livelihoods, such as seaweed farming, pressure on overexploited local fisheries can be relieved while stocks rebound. And marine spatial planning, a decision making process that creates a blueprint for ocean use and conservation, allows other commercial activities to be more effectively managed and regulated. Micronesian Shark Sanctuary. The Federated States of Micronesia has joined Palau, Guam, the Northern Mariana Islands and the Marshall Islands to establish the world's largest regional shark sanctuary, covering nearly 3 million square miles, an area almost the size of the continental United States. The waters will now be off limits to shark finning and fishing. The Nature Conservancy was invited by the Micronesian government to join its shark legislation working committee because of the organization's history of neutrality and productive partnerships. Gulf of Maine Fisheries. The Nature Conservancy is working across Maine, New Hampshire and Massachusetts to restore fisheries, revitalize the fishing economy and enhance the lives of people who rely on the Gulf of Maine's health. Among the innovations are acquiring fishing permits, testing methods and gear that limit by catch, and introducing video monitoring to make reporting catch more efficient. Fishermen off Cape Cod are helping the Conservancy study Atlantic cod, with the aim of restoring the iconic fish. And near shore, the Conservancy is restoring oyster beds and eelgrass to improve water quality and habitat for juvenile fish. New Bahamas Marine Parks. Thanks to The Nature Conservancy's support, five new national marine parks have been declared in the Bahamas. This is a significant step toward fulfillment of the Bahamian government's commitment to the Caribbean Challenge Initiative, which aims to conserve at least 20 percent of the region's near shore marine and coastal environments by 2020. The parks encompass nurseries for Nassau grouper, queen conch and spiny lobster, as well as crucial grounds for seabird species that breed in the Bahamas. The parks will benefit local fishers and, consequently, food security, and will help create jobs by stimulating ecotourism. Southern Seascapes Restoration. In Australia The Nature Conservancy has worked with the Victoria government and Albert Park Yachting and Angling Club to restore Port Phillip Bay's lost shellfish reefs. Drawing on experience from shellfish restoration projects around the world, the project is testing innovative methods to reestablish the reefs, which filter water and provide habitat for fish. The project is the first restoration effort in the Conservancy's Great Southern Seascapes program, which includes the bays and estuaries of Australia's southern coastline. CLIMATE A 50 State Strategy. Climate policy and action as exemplified by California. As part of The Nature Conservancy's global efforts to affect policy and demonstrate nature based solutions to reduce greenhouse gas emissions, each U.S. state program is harnessing local knowledge and relationships to increase support for emissions reductions nationwide. To accelerate this work, w”

“Continued from line 4b. CITIES Metropolitan New York. Bringing conservation to cities in an increasingly urbanized world. Urban conservation is the newest addition to The Nature Conservancy's global agenda, but many component strategies are being adapted from Conservancy experience elsewhere, and some elements have been under way for decades. New York City offers a glimpse of the role the Conservancy will play in helping cities tap nature to become more livable places, resolve challenges of pollution and climate change, and enable citizens to maintain a connection to nature even in the densest urban centers. North American Cities. The Nature Conservancy established an initial network of 13 U.S. cities to advance the role that nature plays in ensuring urban communities have access to the clean water, healthy trees and resilient coasts needed to thrive. The cities are working together to identify common urban partners, as well strategies that best tap Conservancy skills and can be replicated elsewhere. In Miami, for example, Conservancy staff helped launch Coastal Defense, a geographically tailored decision making tool that examines how coral reefs and mangroves help protect Florida's urban coastal communities. D.C. Storm Water Solutions. The Potomac and Anacostia rivers, which flow through Washington, D.C., are routinely polluted with sewage and storm water runoff containing oils, pesticides, nutrients and sediments. Under Washington's current storm water regulations, all new major development projects must meet storm water retention standards that can be fulfilled, in part, by using off site storm water retention credits. The Nature Conservancy's Maryland and D.C. chapter and the impact investment unit NatureVest are working to cultivate and solidify investment resources and to support Washington's reduction of urban pollution through green infrastructure solutions that restore the city's natural hydrology, allowing rainwater to be absorbed by the soil instead of becoming a pollutant. Hong Kong Youth Engagement. With a goal of inspiring the next generation of conservation leaders, The Nature Conservancy in Hong Kong launched an urban youth engagement program, created with education collaborator Seeds Training. More than 100 students from more than three dozen secondary schools across the city participated in the inaugural Nature Works Hong Kong program. Students work with volunteer advisors from the corporate and nonprofit worlds to create realistic plans to resolve environmental challenges in their communities. Urban Forests and Air Quality. Recognizing the need to understand the science of urban conservation, The Nature Conservancy's new cities program is leading research on the role of nature in urban centers. First up is an analysis of the value of urban trees in improving air quality and mitigating heat islands. The initial phase of the study will be conducted in the United States, where urban air pollution is a serious health threat. Research results could help guide urban planning around the world.”

“Net Assets of Unconsolidated Subsidiaries”