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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. These transitions bring significant risk—not just in the form of new regulations, but also through public pressure and shifting societal expectations.

Governments are increasingly implementing nature-related policies, including biodiversity protection laws, deforestation regulations, and sustainability disclosure requirements. These can affect land use rights, restrict access to high-impact regions, or mandate new levels of transparency across supply chains. Companies unprepared for this evolving landscape may face regulatory non-compliance, operational restrictions, or litigation.

Simultaneously, activism from NGOs, consumers, and shareholders is driving reputational risk and market realignment. Organisations perceived to be contributing to biodiversity loss, habitat destruction, or climate inaction are facing boycotts, shareholder resolutions, and divestment.

This convergence of regulatory and societal pressure represents a powerful transitional risk—forcing companies to rethink business models, operational footprints, and sustainability strategies.

NatureAlpha’s Geoverse 2.0 enables businesses to proactively navigate this changing context. With real-time risk scoring, asset-level insights, and policy-aligned analytics, the platform empowers users to anticipate regulatory change, reduce reputational exposure, and lead the transition to a more nature-positive economy.

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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.