Reducing risk: cementing nature as infrastructure

With insurance risks continuing to occupy board and policy agendas, could investing in our natural infrastructure be an untapped opportunity for greater economic resilience and growth? 

The recently launched Natural Infrastructure Plan from The Aotearoa Circle details what businesses, and New Zealand as a whole, stand to gain if we better recognise the value nature already delivers and consciously consider it as part of future infrastructure planning and scoping. 

Its Chief Executive, Vicki Watson, says nature already works 24/7 to provide us with often unseen and underappreciated infrastructure solutions such as wetlands that control and buffer fluvial flooding, and sand dunes acting as seawalls to prevent coastal flooding. 

“If we want to create long-term value and growth, then we need to acknowledge nature as a viable infrastructure solution and consistently embed it in considerations and investment planning processes going forward,” says Watson. “Doing so could enable us to better ride economic shock waves and help future-proof us against increasingly extreme weather events. Investing in nature-based solutions also presents opportunities for job creation, regional development, continuity of insurance cover and stronger infrastructure resilience.”  

Rethinking infrastructure investment 

According to Te Waihanga estimates, New Zealand’s infrastructure deficit is currently more than $200 billion, with up to $1 trillion needed over the next 30 years. Coupled with growing climate exposure, it is clear that new thinking is required to meet our infrastructure needs and extend asset life. 

“With ‘hard’ engineering solutions, much of our future infrastructure funding will be absorbed by maintenance, but with natural infrastructure, much of that ongoing maintenance cost is taken care of naturally. Natural infrastructure provides a 1+1=3 opportunity. For example, it can reduce flood and erosion risk, all while strengthening long-term economic resilience and enhancing biodiversity. It is an invaluable but often overlooked tool in the infrastructure toolkit.” 

The Plan includes case studies that demonstrate measurable financial returns, risk reduction, and environmental and social gains from a range of solutions already successfully deployed within projects across New Zealand. It also includes an investment decision toolkit designed to aid evaluation of nature-based solutions alongside traditional infrastructure, opportunities for four critical economic sectors and recommendations for our public and private sectors to implement. 

It was developed with the aid of more than 200 contributors with a steering committee acting as a sounding board. Committee member David Carter MInstD says the plan aligns with Te Waihanga’s call for a shift from short-term thinking to long-term value in the Plan. 

“Traditional ‘grey’ infrastructure responds well to the need for immediate results yet often prioritises short-term capital cost efficiency. But over time, maintenance and repair costs can escalate,” Carter says. “By integrating natural infrastructure, such as pairing engineered stormwater systems with restored wetlands, flood risk can be managed more effectively while also improving water quality and providing recreational spaces.”  

“Coastal protection, combining seawalls with dune restoration, is inherently more adaptable and resilient to climate change over time. By using natural and grey in tandem, we’re not choosing between economic growth and environmental protection – instead we have an opportunity to maximise both.” 

Embedding natural infrastructure in decision making 

Carter, who is also a director of The Aotearoa Circle, believes subconsciously most leaders understand the role nature plays in our economy but formally embedding natural infrastructure into planning, procurement and investment decisions, alongside traditional engineered solutions, will require a mindset shift towards bolder, future-focused solutions. 

“By increasingly thinking in terms of long-term resilience, as opposed to immediate returns, the range of solutions will change. That includes recognising climate and environmental risks, understanding where natural systems underpin economic and social wellbeing, and investing in their maintenance and enhancement. The Plan provides a practical framework to do this, giving leaders another tool to better address mounting risks and demands,” says Carter. 

“Ultimately, preparing for the future isn’t about choosing between growth and the environment – it’s about leveraging both. By considering and investing in the natural systems that protect our economy and communities, we can create infrastructure that is smarter, more resilient and delivers value for generations to come.” 

Annabell Chartres, also a director of The Aotearoa Circle and contributor to the Plan, adds that it’s important to address how infrastructure options are assessed in the first place. 

“Traditional investment assessments often focus heavily on upfront capital costs and defined outputs,” says Chartres. “The Plan’s Investment Decision Toolkit is designed to broaden that perspective. It allows grey, green or blended solutions to be compared on a more like-for-like basis by considering factors such as long-term operating costs, resilience over time, multiple risk exposure and overall system value.” 

The framework also recognises that natural infrastructure rarely delivers just one outcome.  

“A solution designed to reduce flood risk may also improve water quality,” Chartres explains. “A coastal landscape that buffers storm surge may enhance tourism opportunities or community amenity. An investment that reduces maintenance costs may free up resources for other priorities.” 

She says that by assessing benefits across financial, environmental and social dimensions, the toolkit encourages decision-makers to ask a broader question: what else can this investment achieve? 

For boards overseeing long-lived infrastructure investments, that shift may prove increasingly important.  

Immediate priority actions  

While the Plan includes 50 recommendations over 10 years, three priorities for both the public and private sectors are emphasised for 2026. 

For Government: 

1. Include ‘natural infrastructure’ in the definition of infrastructure - specifically section 3 of the NZ 
2. Planning Bill (2025) with a cross reference to the Natural Environment Bill (2025). 
3. Recognise Aotearoa New Zealand’s ‘economic dependency on natural infrastructure’, as a national risk by including this in the National Risk and Resilience Framework. 
4. Bolster central and local government understanding of natural infrastructure including its ecosystem and resiliency benefits to ensure it isn’t only included but expected, as options in infrastructure solutions. 

For the private sector:  

1. The insurance sector to raise awareness of the benefits of natural infrastructure to demonstrate how insurance can remain accessible. 
2. Continued work on innovative funding models and finance mechanisms that can fund natural infrastructure at scale. 
3. Bolstering private sector capability by showcasing and sharing case studies of natural infrastructure to better understand the financial and multiple benefit opportunities.