Let’s talk
Finance shapes every sector of the economy. Banks, insurers and investors allocate the capital that powers businesses, infrastructure and innovation worldwide. Yet financial flows can also enable activities that degrade ecosystems and increase systemic risk.
The very foundations finance depends on stable markets, resilient supply chains and healthy communities. These are increasingly exposed to nature loss and a changing climate. That translates into rising credit, market, operational and liability risks across portfolios.
But transformation is possible. By realigning capital, strengthening stewardship and backing nature-positive solutions, financial institutions can reduce risk, unlock growth and accelerate a resilient, inclusive transition.
The financial system is under growing pressure to account for nature. Regulators, clients, and investors are demanding transparency on risks, while opportunities to finance resilient, nature-positive solutions are expanding rapidly. Four trends are reshaping the sector:
From CSRD and ISSB to the TNFD and the Global Biodiversity Framework, expectations are shifting fast. Institutions are being asked to assess dependencies and impacts, set targets, and disclose credible transition plans that integrate nature alongside climate.
Capital is moving. Clients and counterparties face new rules on deforestation, water and pollution; sectors are rewriting business models. Financing strategies that phase out harmful activities and scale nature-positive solutions are becoming a core differentiator.
Nature loss is a financial risk. Physical risks (e.g., water scarcity, floods, heat) and transition risks (policy, legal, market) can impair asset values across multiple sectors. Integrating nature with net-zero strategies is now essential for resilience and long-term value.
.jpg)
If left unaddressed, these challenges will amplify portfolio risk, raise capital costs and erode client trust.
Financed activities can drive land-use change, pollution and over-extraction — creating credit, market and liability risks that compound through value chains.
Inconsistent data on locations, drivers of loss and state-of-nature makes it hard to assess materiality, set targets and evidence progress across asset classes.
Influencing diverse counterparties across geographies and sectors demands clear policies, escalation pathways and sector-specific expectations.
If managed well, finance can de-risk portfolios, unlock new products and catalyse real-economy change.
Support clients to avoid and reduce nature harm — from deforestation-free supply chains to water-efficient operations — through lending terms, underwriting and investment.
Grow pipelines for nature-based solutions and resilience projects — using blended finance, outcome-based vehicles and place-based (landscape/jurisdictional) approaches.
Expand labelled instruments and risk-sharing tools (sustainability-linked loans, biodiversity-themed funds, structured solutions) with robust KPIs and verification.
Integrate nature into pricing, collateral, screening and scenario analysis to cut losses, improve portfolio resilience and open access to sustainable capital pools.
.jpg)