Biodiversity Equity

Investing for life and the planet.

Reasons to invest

We have reached a tipping point

Human activity has severely altered 75% of the planet’s land surface and 66% of the marine environment. Average species population sizes fell by 68% between 1970 and 20161.

Biodiversity offers critical mitigation against climate change

Forests, peatlands and grasslands are natural carbon sinks that absorb and store CO². Protecting and restoring these ecosystems is considered the second most effective solution to climate change after switching from fossil fuels.

Biodiversity impacts the economy

Research suggests over 50% of global GDP is highly or moderately dependent on nature2. Failure to act could result in collapsing food systems, loss of livelihoods and pose a systemic risk to the global economy.

The role of finance

Companies and investors have largely ignored this problem thus far. We are facing a global biodiversity funding gap of >$800m3 per annum, and the financial industry can play a key role through capital allocation and stewardship.

1 WWF, Living Planet Report (2020).
2 Sources: IPBES Report (2019), EOS, Our Commitment to Nature (2021), WWF and ZSL, Living Planet Report (2020), Seven ESG Trends to Watch in 2021 | S&P Global (spglobal.com).
3 Global Canopy, The Little Book of Investing in Nature (2021)

Ingrid Kukuljan

The negative impacts of biodiversity loss pose a systemic risk to the global economy and we must stop taking nature’s permanence for granted. We believe now is a crucial moment to invest in the companies that help mitigate biodiversity decline.

Ingrid Kukuljan
- Head of Impact & Sustainable Investing, Portfolio Manager

Why Biodiversity Equity?

We aim to achieve long-term capital appreciation by investing in a concentrated portfolio of companies that are best in class and are providing solutions to avert loss of and support restoration of biodiversity.

We have extensively researched the major regional and global threats to biodiversity and have defined six investable themes: land pollution, marine pollution and exploitation, unsustainable living, climate change, unsustainable farming, and deforestation. Each of these themes has multiple sub-verticals that are aligned to specific UN Sustainable Development Goals (SDGs).

As well as investing in companies that offer solutions to the biodiversity crisis, we also engage with transitioning companies. EOS at Federated Hermes Limited (EOS) is a leading global engagement and stewardship team with expertise on topics including climate change, deforestation, sustainable food systems, and plastics.

Federated Hermes Limited is a pioneer in this field, with a strong record advocating and engaging around biodiversity. We are members of industry organisations including the Finance for Biodiversity Pledge, the PRI Sustainable Commodities Practitioners’ Group, the SPOTT Supporter Network, the Partnership for Biodiversity Accounting Financials, and the PRI plastics working group.

Our commitment to nature was outlined by EOS at Federated Hermes Limited in their recent biodiversity white paper.

For more insights on the vital role investors play in limiting biodiversity loss, visit our biodiversity hub

How we invest

Thematic framework
Detailed company analysis, quantifying impact potential
Integrated approach to ESG and engagement

Team

Gemma Corrigan

Gemma Corrigan

Head of Policy and ESG Integration, Federated Hermes Limited

Sonya Likhtman

Sectors: Consumer Goods, Financial Services

Ingrid Kukuljan

Head of Impact & Sustainable Investing

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