Natural Capital: Investing for Impact

Why it’s time to fully embrace Natural Capital

Natural capital can be thought of as the Earth’s balance sheet, comprising the planet’s stock of natural resources and ecosystems that provide benefits to humans and all living things—and the vital services those stocks provide. This represents an exciting investment innovation that can achieve a range of positive impacts and create opportunities outside of traditional investment silos.

Natural capital investment strategies have long been appreciated by investors for their ability to provide sources of diversification, long-term income, and inflation protection, with robust long-term fundamentals supported by providing basic human needs that are expected to grow in line with population and income growth. Yet despite growing awareness of natural capital’s social and environmental benefits and increasing requirements for investors to disclose the climate and nature-related impact of their portfolios, there remains significant underinvestment. 

As the world’s largest investment manager of natural capital assets*, we believe we’re uniquely positioned to accelerate the use of nature-based solutions in the fight against climate change and recognize existing opportunities, emerging themes, and provide long-term value for our stakeholders while supporting a positive trajectory for the economy.

To learn more, see the latest natural capital thought leadership from our investment experts:

Investing In The Power Of Nature

The crisis facing the world’s biodiversity has become front of mind for policymakers and investors in recent years. Investing in natural capital—the world’s stock of natural resources that combine to yield a flow of benefits—represents an exciting investment innovation that can achieve a range of positive impacts and create opportunities outside of traditional investment silos.

Explore Manulife IM's paper Investing in the Power of Nature.

Expanding the Efficient Frontier with Natural Capital Investments

Interest in natural capital is rising, and natural resource asset classes such as timberland and farmland are attracting increasing investor attention given their potential to positively impact the environment while augmenting the returns generated from traditional management.

Discover how to take advantage of these opportunities.

The Global Water Challenge: Risks and Opportunities

The United Nations describes climate change as “primarily a water crisis,” observed through increasing water scarcity and more acute water-related hazards, such as floods, droughts, and storms. Today, more than 50% of the world’s cities and 75% of all irrigated agricultural areas experience water shortages on a recurring basis.

Gain a better understanding of the water shortage crisis with this paper.

Regenerative Agriculture: Definition, Implementation, and Impact

Feeding a growing population in a world of increasingly scarce natural resources will require sustainable solutions, which is where regenerative agriculture could play a critical role.

Find out more about regenerative agriculture here.

Regenerative Real Estate Investing

Across the United States, families are increasingly being priced out of residential real estate markets. By year-end 2022, the United States experienced its fastest-ever three-year deterioration in the affordability of home ownership.

Read why regenerative real estate investing is becoming more important.

How Carbon Markets Bolster Timberland Investing

As more and more investors look to integrate natural capital strategies into their portfolios, timberland is proving to be an obvious beneficiary.

Explore the link between timberland investing and the dynamic carbon markets.

*IPE research, as of 29 January 2024. Ranking is based on total natural capital assets under management (AUM), which include forestry/timberland and agriculture/farmland AUM. Firms were asked to provide AUM and the as of dates vary from 31 December 2022, to 22 December 2023.