Stuart Empson, Eugenie Mathieu, Jonathan Toub and Julie Zhuang explain how investments in natural capital – biodiversity, water, air, geology and soil – can deliver returns while protecting and restoring ecosystems.

High-functioning biodiversity and ecosystems underpin 55 per cent of global GDP. But every year, humans consume 60 per cent more of these resources than the planet can provide and dispose of them instead of reusing and recycling them.1 This is leading to a collapse in species, natural resources and ecosystems.

The good news is investing in companies whose operations, products or services reduce humans’ impact on nature presents huge opportunities, not only to deliver nature-positive outcomes, but also sustainable returns.*

*By “nature positive” outcomes, investments or other actions, we mean outcomes, investments or actions that protect, restore and/ or nurture natural capital, be it biodiversity, water, air, geology and/ or soil.

Figure 1: A possible $10.1 trillion of annual business opportunities by 2030 (in US$ billions)

Source: World Economic Forum, July 14, 20202

Why invest in natural capital?

Four themes offer a broad universe of investment opportunities and link to the United Nations’ Sustainable Development Goals (SDGs) on responsible consumption and production; life on land; life below water; and climate action. Regulation, consumer demand and new technologies provide consistent tailwinds across these four themes.

Circular economy

The circular economy includes recycling and reuse technologies, sustainable packaging (like cardboard instead of plastic) and waste treatment. This theme derives from changing consumer demand and regulation as well as cost benefits, a combination that could generate $2.3 trillion in annual business opportunities by 2030.3

Sustainable land

Intensive agriculture is one of the biggest drivers of biodiversity loss and greenhouse-gas emissions. But innovation and consumer demand could be a source of significant growth in more sustainable methods. Backed by increasing regulation, investment in areas such as agricultural technology and alternative proteins is surging – and so is demand (Figure 2).

Figure 2: Projected growth in alternative proteins (per cent)

Note: H = High growth scenario. L = low growth scenario. Remainder are base case scenarios.
Source: FAIRR, October 25, 20224

Sustainable oceans

As the danger to oceans becomes clear, there is a global push to protect water systems from antibiotic pollution, creating opportunities for investments in water-treatment companies.5 And, given plummeting fish stocks, feeding seafood with fish is no longer economical or environmentally prudent, so there is innovation in novel feed sources. Most are still at a nascent stage of development, but we anticipate strong growth in the coming years.6

Climate action

Climate change is a well-known theme with over $4 trillion of potential business. Particularly attractive opportunities can be found in niche areas such as green transport or animal feed that reduces cows’ methane emissions.7

Delivering returns through nature-positive investments

The Aviva Investors Natural Capital Transition Global Equity strategy seeks to outperform broader global equity markets, as measured by the MSCI ACWI, by two per cent per annum gross of fees over three-year rolling periods and help accelerate a sustainable transition towards a nature-positive economy through investments in solutions and transition companies.


Solutions companies offer technologies, products and services that actively protect or reduce human impacts on nature. To identify these, we draw on the insights of our equity analysts, ESG sector analysts and sustainable outcomes team, using multiple data sets.


Increasing physical risk, changes in regulation and growing consumer awareness will lead to winners and losers in a wide range of industries. Those that anticipate and adapt to change are likely to prosper, so the ability to pick such winners can lead to sustainable returns uncorrelated to broader financial market performance. 

Investing in these companies allows us to consider the whole of the economy instead of focusing narrowly on solutions providers, and to support nature-positive outcomes by encouraging the whole economy to better protect and restore natural capital.

Engaging to maximise value

To maximise the strategy’s contribution to a nature-positive economy, we also conduct bespoke engagement with every company we hold and engage with governments, policymakers and other key stakeholders to correct market failures on sustainability issues (see AIQ: The macro stewardship edition).8

Company engagement

When engaging on environmental issues, we ask companies to carry out a biodiversity assessment and set targets on key impact areas. We also identify a specific gap for each firm, which we ask them to address. We may divest from any company that does not make sufficient progress towards these asks within a three-year period.

Macro stewardship

Complementing our engagement at a company level, our macro stewardship team actively engages with governments, policymakers, and other key stakeholders to try to correct the market failures that lead to the destruction of nature. Changes to protect nature should also benefit solutions companies and transition leaders.

Download Investment opportunities in natural capital to understand:

  • Why depleting natural resources can hamper future economic growth
  • The structural trends that underpin the investment case for natural capital opportunities
  • Why and how the Aviva Investors Natural Capital Transition Equity strategy invests in solutions companies and transition leaders

Past performance is not a reliable indicator of future returns.

Key risks

Investment/objective risk

The value and income from the strategies assets will go down as well as up. This will cause the value of your investment to fall as well as rise. There is no guarantee that the strategy will achieve its objective and you may get back less than you originally invested.

Emerging markets risk

Investments can be made in emerging markets. These markets may be volatile and carry higher risk than developed markets.

Related views

Important information


Except where stated as otherwise, the source of all information is Aviva Investors Global Services Limited (AIGSL). Unless stated otherwise any views and opinions are those of Aviva Investors. They should not be viewed as indicating any guarantee of return from an investment managed by Aviva Investors nor as advice of any nature. Information contained herein has been obtained from sources believed to be reliable, but has not been independently verified by Aviva Investors and is not guaranteed to be accurate. Past performance is not a guide to the future. The value of an investment and any income from it may go down as well as up and the investor may not get back the original amount invested. Nothing in this material, including any references to specific securities, assets classes and financial markets is intended to or should be construed as advice or recommendations of any nature. Some data shown are hypothetical or projected and may not come to pass as stated due to changes in market conditions and are not guarantees of future outcomes. This material is not a recommendation to sell or purchase any investment.

Where relevant, information on our approach to the sustainability aspects of the strategy and the Sustainable Finance disclosure regulation (SFDR) including policies and procedures can be found on the following link:

In Europe this document is issued by Aviva Investors Luxembourg S.A. Registered Office: 2 rue du Fort Bourbon, 1st Floor, 1249 Luxembourg. Supervised by Commission de Surveillance du Secteur Financier. An Aviva company. In the UK this is issued by Aviva Investors Global Services Limited. Registered in England No. 1151805. Registered Office: St Helens, 1 Undershaft, London EC3P 3DQ. Authorised and regulated by the Financial Conduct Authority. Firm Reference No. 119178. In Switzerland, this document is issued by Aviva Investors Schweiz GmbH.