Why integrating climate, water, and nature strategy can't wait

The last decade established climate action as a corporate norm. Companies set net zero targets, disclosed emissions, and restructured energy portfolios. These commitments have driven real progress, yet they also exposed a structural gap. Managing climate in isolation fails to address the broader systems that determine whether businesses can thrive.

Nature underpins the economy. The World Economic Forum estimates that more than half of global GDP depends directly on nature’s services, from reliable water supplies and fertile soil to climate regulation and flood protection. When these systems degrade, the financial consequences are immediate. For example, the 2018 drought in Germany reduced national GDP growth by an estimated 0.2% as harvests failed and river transport slowed. Recent wildfires in North America and Australia have caused billions in direct losses and production delays, underscoring how nature degradation quickly translates into economic disruption.

Across sectors, the warning signs are clear. Droughts have disrupted beverage production, soil degradation has cut agricultural yields, and biodiversity loss has reduced the stability of raw material supplies. Manufacturing and extractive industries are now facing stricter discharge rules and water restrictions in key regions.

Three trends are accelerating this convergence of environmental and financial materiality:

• Regulation - The TNFD, CSRD, and ISSB are embedding nature and water into corporate disclosure frameworks, moving from voluntary guidance toward regulatory expectation.
• Technology - Advances in spatial finance and digital monitoring now allow companies to quantify nature risk and performance with unprecedented precision.
• Economics - The business case for regenerative agriculture and circular materials is strengthening. Studies show positive returns within 3-5 years through lower inputs and greater yield stability. 

These forces confirm that nature risk is financial risk. Companies that act now will not only meet emerging standards but also capture new sources of business value by lowering input and compliance costs, securing supply continuity, and driving innovation that strengthens long-term resilience.