When nature becomes real in the boardroom

Nature is increasingly entering boardroom conversations, but rarely as a standalone issue. Instead, it is showing up through familiar governance lenses: supply chain disruption, infrastructure resilience, insurance availability and capital access. For many boards, the shift is not about adding a new topic but recognising how existing decisions are being shaped by dependencies on natural systems. 

At the recent Chapter Zero NZ webinar, Governing for nature: Strengthening strategy, risk and long-term value, panellists Vicki Watson (The Aotearoa Circle), Dr Charles Ehrhart (Chapter Zero Alliance) and Kate Morrison (director) explored what this looks like in practice. 

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A consistent theme was that nature becomes relevant when it becomes financially material. As Morrison noted, these issues become strategic when they affect risk, cost, access to capital or market position. For many organisations that threshold has already been crossed, often without being explicitly labelled as ‘nature’. 

Water availability is already affecting operations in sectors such as agriculture, manufacturing and food processing. Restrictions on water use can limit production, require investment in storage or alternative supply, and change the economics of existing assets. These are operational and capital decisions. 

Supply chains are another point of exposure. Dependencies on soil health, water and ecosystem stability often sit beyond direct operations, but disruptions are flowing through into cost, quality and reliability. For example, changing growing conditions or degraded land can reduce yields, affecting supply for exporters, manufacturers and supermarkets. Boards need to understand where these dependencies sit and how resilient they are. 

Insurance is also providing a clear signal. In some areas, rising premiums or reduced cover linked to erosion, land instability or environmental degradation are forcing boards to reassess asset viability. This shifts nature from a background issue to a financial one, directly influencing investment and portfolio decisions. 

These pressures converge most clearly in capital allocation. Boards are weighing trade-offs between upfront cost and long-term resilience, including whether to invest in traditional engineered solutions or alternatives such as catchment management or natural infrastructure.  

Nature is also shaping market access. Export markets are placing greater emphasis on traceability and environmental performance, while investors are asking more detailed questions about exposure to nature-related risks. Organisations that can demonstrate stronger environmental stewardship may find advantages in access to capital and markets. 

In some cases, understanding nature dependencies has led to more efficient use of resources such as water and energy, reducing costs. In others, it has strengthened supplier relationships and improved supply chain resilience. For some organisations, it is opening up new market opportunities where environmental performance is becoming a point of differentiation. 

Morrison also noted that these issues often surface through day-to-day decisions such as procurement choices, capital investment and supply chain management, rather than as a standalone “nature” agenda item. Boards need to recognise those signals and respond deliberately. 

The challenge is not awareness, but execution. As Ehrhart put it, “you can have all the right architecture and still produce governance theatre rather than substance. What determines whether a board actually challenges management, interrogates assumptions and asks the questions no one else in the room is asking – is not structure. It’s two things: capability and culture.” 

This is where governance moves from process to practice. Boards may have reporting, frameworks and committees in place, but the real difference lies in how actively they engage with the issue, including how they test assumptions, challenge management and integrate these considerations into decisions. 

A key barrier is often not a lack of information, but uncertainty and competing priorities. Nature-related risks can be complex and difficult to quantify. But waiting for perfect data can delay progress. 

As Watson noted, “don’t let perfection get in the way of progress.” 

In practice, boards are finding entry points through existing decisions such as climate work, insurance pressures, supply chain disruption or major capital investments. 

Practical questions for boards include: 

• • Is nature reflected in the risk register, particularly where it affects operations, assets or supply chains?  
  • Where could nature-based approaches improve resilience or reduce long-term costs?  
  • Do we understand our critical dependencies on water, land or ecosystems — and how stable they are?  
  • Do we have the right capability at the table, or do we need to bring in additional expertise?  
  • What are we already measuring — and what needs to be added to support better decisions?  

“What gets measured gets managed,” Watson noted.  

“If you understand the value natural systems provide your organisation, and the role they play, you’ll be better able to make informed, strategic decisions that can improve your resilience against continued external shocks, while adding value over the long-term.” 

Nature is already influencing risk, cost and performance. The task is to make those connections visible and ensure they are reflected in how decisions are made, particularly in strategy, risk oversight and capital allocation. 

Progress starts with better questions, clearer visibility of dependencies and a willingness to act on imperfect information.  

Nature is already shaping the environment in which organisations operate. The question for boards is whether governance is keeping pace.