We estimate the loss of value that companies might suffer from nature overexploitation. We find that global equities shed 26.8% in a scenario of unabated nature decline, while the worst-performing firms lose ~75% of their value. Our risk framework considers five environmental hazards: biodiversity loss, land degradation, climate change, human population and nature capital. We also introduce two metrics to assess nature-related risks: a Country Degradation Index that tracks the damage caused by environmental hazards in specific territories, including nonlinear dynamics and tipping points; and a Nature Risk Score that summarizes the risk that companies face due to the decline of nature and its services.
Cite
@article{arxiv.2501.14391,
title = {Quantifying firm-level risks from nature deterioration},
author = {Ricardo Crisostomo},
journal= {arXiv preprint arXiv:2501.14391},
year = {2025}
}