Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

First Sentier Investors

  •   7 September 2023
  •      
  •   

First Sentier Investors launches investor guide to assess and engage on nature

Thursday, 7 September 2023: First Sentier Investors, a leading global investment manager, today launches a nature and biodiversity guide ("guide”) for institutional investors to identify, assess materiality and responses to nature and biodiversity risks in portfolio companies.

The guide, titled ‘Investors Can Assess Nature Now’ (ICANN), provides a step-by-step outline, including which resources can be used at each step, for investors to undertake nature-related company assessments and develop engagement approaches to biodiversity risks.

Focusing specifically on freshwater and forests, two areas the firm views as fundamental to both the global economy and the fight against climate change, the guide will help bridge the gap between the framework outlined by the Taskforce on Nature-Related Financial Disclosures (TNFD), and the practicalities of navigating the data available.

The guide maps a due diligence framework for appraising and engaging on three critical issues; firstly, identification of sector exposures and understanding of material nature pressure areas; secondly, prioritisation and assessments of companies, including due diligence, metrics to look for and country-level assessment; and thirdly, company engagement, outlining how to interpret the data and questions to ask.

The questions posed in the company engagement framework can also provide helpful insights for companies to better measure and disclose their nature-related risks, opportunities, dependencies and impacts, and to develop their own policy or position on nature.

Kate Turner, Global Head of Responsible Investment at First Sentier Investors, said: “There is growing global momentum to address nature and biodiversity risks, however the topic is still relatively new for many investors. While there is a data challenge, knowing what tools are available and when to use them can also be a roadblock. This guide provides an outline of the available resources for assessments, including raising alternate ways to navigate data issues.”

Joanne Lee, Responsible Investment Specialist at First Sentier Investors and author of the guide, said: “There are challenges with nature-related data and the unfamiliarity with the topic among the investor community, but we can’t let perfect be the enemy of good. Although many investors still don’t have easy access to asset-level location data or supply chain data of a company, there are other ways to conduct due diligence, enough for investors to start identifying areas material to their own risk management as well as the company’s business and its impact.

“In time, we will see data improving as more investors and companies begin to focus on biodiversity and nature. As allocators of capital, investors have the opportunity to help improve nature-related data and company practices,” said Lee.

This guide is the latest initiative from First Sentier Investors to deepen understanding of nature-related issues. Along with the First Sentier MUFG Sustainable Investment Institute, which it established in 2021, the firm will be evolving its work in nature and biodiversity by expanding into other drivers in this area.

“Addressing the complexities in nature and biodiversity is an ongoing journey for us. By working together, we believe capital allocators can address the challenges better. Investors can assess nature, despite not having the perfect tools, and it can start now,” concluded Turner.

Click here for more information and to download the paper

 

  •   7 September 2023
  •      
  •   
banner

Most viewed in recent weeks

Retirement income expectations hit new highs

Younger Australians think they’ll need $100k a year in retirement - nearly double what current retirees spend. Expectations are rising fast, but are they realistic or just another case of lifestyle inflation?

Four best-ever charts for every adviser and investor

In any year since 1875, if you'd invested in the ASX, turned away and come back eight years later, your average return would be 120% with no negative periods. It's just one of the must-have stats that all investors should know.

Why super returns may be heading lower

Five mega trends point to risks of a more inflation prone and lower growth environment. This, along with rich market valuations, should constrain medium term superannuation returns to around 5% per annum.

The hidden property empire of Australia’s politicians

With rising home prices and falling affordability, political leaders preach reform. But asset disclosures show many are heavily invested in property - raising doubts about whose interests housing policy really protects.

Preparing for aged care

Whether for yourself or a family member, it’s never too early to start thinking about aged care. This looks at the best ways to plan ahead, as well as the changes coming to aged care from November 1 this year.

Our experts on Jim Chalmers' super tax backdown

Labor has caved to pressure on key parts of the Division 296 tax, though also added some important nuances. Here are six experts’ views on the changes and what they mean for you.        

Latest Updates

A speech from the Prime Minister on fixing housing

“Fellow Australians, I want to address our most pressing national issue: housing. For too long, governments have tiptoed around problems from escalating prices, but for the sake of our younger generations, that stops today.”        

Taxation

Family trusts: Are they still worth it?

Family trusts remain a core structure for wealth management, but rising ATO scrutiny and complex compliance raise questions about their ongoing value. Are the benefits still worth the administrative burden?

Exchange traded products

Multiple ways to win

Both active and passive investing can work, but active investment doesn’t in the way it is practised by many fund managers and passive investing doesn’t work in the way most end investors practise it. Here’s a better way.

Economy

The Future Fund may become a 'bad bank' for problem home loans

The Future Fund says it will not be paying defined benefit pensions until at least 2033 - raising as many questions as answers. This points to an increasingly uncertain future for Australia's sovereign wealth fund.

Investment strategies

Managed accounts and the future of portfolio construction

With $233 billion under management, managed accounts are evolving into diversified, transparent, and liquid investment frameworks. The rise of ETFs and private markets marks a shift in portfolio design and discipline. 

Property

Commercial property prospects are looking up

Commercial property is seeing the same supply issues as the residential market. Given the chronic undersupply and a recent pickup in demand, it bodes well for an upturn in commercial real estate prices.

Infrastructure

Private toll roads need a shake-up

Privatised toll roads in Australia help governments avoid upfront costs but often push financial risks onto taxpayers while creating monopolies and unfair toll burdens for commuters and businesses.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.