The post-2015 Paris Agreement era has seen the investment community earnestly grapple with climate risk and opportunities. This shift has significantly influenced how asset managers analyse their targets, design their products, articulate their strategies, and report to clients. Simultaneously, the repercussions of climate change have also affected asset prices and finance regulations, within the European context and beyond.
While scientists and ecologists have long been sounding the alarm about the precarious state of nature and biodiversity, the finance industry has found it more challenging to heed these warnings. This difficulty arises partly from the long history of human exploitation of nature, leading to a taken-for-granted perspective. Additionally, nature-related risks prove even more elusive to measure and quantify compared to more tangible factors like climate change and fossil fuel consumption.
The scarcity of significant returns associated with biodiversity-related business opportunities has further hindered the finance industry’s responsiveness. In navigating this terrain and seeking tangible examples of how to integrate nature and biodiversity into the investment process, we have turned to the natural capital asset class. Who better than these investors to provide insights into the optimal strategies they’ve employed to safeguard their assets?
A captivating discussion unfolded during a late-summer lunch in Stockholm among six seasoned investors deeply engaged in the natural capital asset class. This collection of their expertise offers valuable guidance not only for those contemplating exposure to this asset class but also for those seeking inspiration to incorporate nature-related risks into their investment processes. Whether you are delving into this asset class or searching for innovative ways to address nature-related risks, we trust that this compilation of insights will prove invaluable.
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