Planetary boundaries – How we sustain ourselves in a higher temperature world

Focusing on climate change alone will not maintain a stable planet that continues to support life and human development; we have to define the environmental limits within which humanity can safely operate. A scientific approach has identified nine planetary boundaries, which regulate the stability and resilience of the planet we live on: climate change, biodiversity loss, ocean acidification, ozone depletion, atmospheric aerosol pollution, freshwater use, biogeochemical flows of nitrogen and phosphorus, land-system change, and release of novel chemicals. The identification of these core boundaries is central to our investment approach, along with the effects of crossing any tipping points. We aim to identify how capital can be deployed to support the efficient use of land and water resources – from forestry to food to fishing.

Biodiversity has become an increasingly prevalent theme in our engagement, reflecting clients’ heightened interests and rising demand for transparency around companies’ biodiversity impact.

Our engagement on the topic seeks to understand whether companies are taking action. Engagement within the planetary boundaries theme is also strongly driven by our sustainable strategies seeking to encourage positive progress within a certain thematic focus.

Engagements in the space have already covered a wide range of topics to address negative biodiversity impact. Through engagements we actively encourage companies to develop products or solutions that actively contribute to positive environmental and social outcomes along the supply chain. We promote regenerative agriculture – farming and grazing practices that can regenerate soil and organic matters and rebuild degraded soil biodiversity. As soil health improves, fertiliser input should decrease, crop yields could increase, and soils become more resilient against pests and pathogens as well as climate change. Regenerative agriculture is a solution which could contribute to solving the challenges of sustainable agriculture and feeding a growing population.

We actively urge investee companies to address deforestation in their value chains. Our deforestation engagement strategy focuses on putting pressure on agribusinesses as well as their customers, covering investment banks and shareholders. We believe this multi-pronged effort will achieve the greatest impact.

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