How can financial institutions address natural capital risk?

Our Alliance has helped to create a standardised set of guidance on how to incorporate environmental risks and opportunities into lending, investment and insurance decision-making. This provides an excellent starting point for financial institutions committed to managing natural capital risks and opportunities linked to their portfolios.

Entitled ‘Connecting Finance and Natural Capital’, the guidance is a supplement to the Natural Capital Coalition’s Protocol – the standard now adopted by hundreds of businesses worldwide on natural capital.

This framework will guide financial institutions through the process of identifying, measuring and valuing material risks and opportunities as a means of informing financial decision-making.

 

Case study – Actiam

ACTIAM uses natural capital thinking mainly for two reasons. Firstly, to mitigate hidden financial risks and secondly to identify investment opportunities.

Case study – Yes Bank

Natural Capital is one of YES BANK's key focus areas that has helped the Bank ensure risk mitigation, and cleaner portfolios.