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Physical: Floods, storms and extreme weather

As climate volatility intensifies, physical nature-related risks such as floods, storms, and extreme weather events are becoming more frequent and destructive. For businesses and investors, these risks are no longer isolated incidents—they represent significant threats to the stability, value, and viability of global assets.

Flooding can damage infrastructure, disrupt transportation networks, and halt operations across entire regions. Even temporary inundation can lead to costly repairs, equipment losses, and forced closures, particularly in coastal or low-lying industrial zones.

Storms—including hurricanes, cyclones, and high winds—pose similar threats, damaging buildings, supply chains, and energy systems. They may also increase insurance liabilities and reduce asset insurability in high-risk areas.

Extreme weather events, such as sudden temperature shifts, torrential rains, or seasonal anomalies, introduce uncertainty into agricultural yields, water availability, and production schedules—exposing supply chains and financial portfolios to material disruption.

The cumulative impact? Increased insurance costs, business interruptions, reputational damage, and asset impairment.In worst-case scenarios, entire operations may become unviable.

NatureAlpha’s Geoverse 2.0 equips organisations with the tools to identify these risks in advance, leveraging geospatial intelligence and real-time environmental data to assess vulnerability and inform strategic, nature-aware investments that protect both people and profit.

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NatureAlpha Team
April 11, 2025

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Transitional: Investor divestment & strategy revision

As nature-related risk becomes a core consideration in sustainable finance, investor divestment is emerging as a significant transitional risk for companies failing to align with biodiversity and ecosystem protection goals.

Transitional: Litigation and liability risk

As environmental regulations tighten and public scrutiny intensifies, litigation and liability risk is becoming a critical transitional issue for businesses and financial institutions.

Transitional: Supply chains, systems & processes

As the global economy undergoes a transition toward sustainability, companies face increasing pressure to re-evaluate the supply chains, systems, and processes that underpin their operations.

Transitional: Policy change and activism

As awareness of biodiversity loss and environmental degradation rises, policy change and activism are rapidly reshaping the operating environment for businesses and investors.

Transitional: Natural resource availability

As the global economy shifts toward sustainability, natural resource availability is becoming a central transitional risk. Businesses that rely heavily on finite or declining resources are increasingly exposed.

Transitional: Regulatory and compliance changes

As global momentum builds around sustainability and biodiversity protection, regulatory and compliance changes are emerging as a key transitional risk for businesses and financial institutions.

Physical: Pandemics and social impact

The interconnectedness of human health, biodiversity, and business has never been more evident. Pandemics and their cascading social impacts present significant physical risks to businesses.

Physical: Biodiversity & ecosystem loss

As the natural world continues to degrade, biodiversity and ecosystem loss is becoming a major driver of physical risk—undermining the very systems businesses rely on for resources, resilience, and stability.

Physical: Water risk and rising sea levels

As global temperatures rise, physical water risks and sea level rise are emerging as some of the most material threats to infrastructure, economies, and investment portfolios.

Physical: Droughts, deforestation and landslides

As climate change accelerates and ecosystems are degraded, physical risks such as droughts, deforestation, and landslides are becoming more severe and financially consequential.