Foreword

The report highlights the increasing materiality of nature-related risks, noting that around half of Australia’s GDP depends on nature. With at least 17 ecosystems showing signs of collapse, directors are urged to integrate nature into governance, given its role in underpinning economic resilience. Nature is framed as fundamental economic infrastructure, with boards encouraged to consider foreseeable risks as part of their duties.

Executive summary

The study provides Australia’s first baseline of board-level nature governance. Drawing on 248 survey responses and interviews, it finds high recognition of nature risks (81 per cent) but early, uneven governance practice. Oversight, disclosure and capability vary widely, and many boards are integrating nature through existing climate governance systems.

Key findings

The study finds strong recognition of nature-related risks, a shift toward viewing nature as financially material, and persistent policy uncertainty. Governance measures are emerging but inconsistent, and disclosure uptake remains limited. Approximately one-fifth of boards are classified as ‘active’, showing more advanced oversight, strategic focus and use of external frameworks.

About this study

Nature governance is defined as oversight of dependencies and impacts on ecosystems and their implications for financial, operational and strategic outcomes. The study includes a June 2025 survey of AICD chairs and non-executive directors, supported by interviews. It provides a statistically significant snapshot but acknowledges sample limits, including higher representation of not-for-profit directors.

Nature is emerging as a governance concern

1. Boards recognise nature, even if they don’t explicitly use that term

More than four in five directors consider nature-related risks important, with 49 per cent strongly agreeing. Recognition is highest in primary industries (95 per cent) and among directors with STEM or humanities backgrounds. Boards commonly discuss water, waste, land use and supply chain risks without referring specifically to biodiversity. Two-thirds consider nature through climate, resilience or First Nations perspectives. Interview insights emphasise the need for shared terminology, linking nature to duties of care and diligence, and understanding business dependencies such as pollination, water supply and ecosystem stability.

2. Nature shifts from a reputational concern to a financial risk for boards

While reputation and social licence remain the single strongest standalone motivator (26 per cent), most directors cite multiple drivers. Directors increasingly view nature as a financial risk linked to supply chain disruption, higher costs, asset impairment and litigation risk. CFO involvement and framing nature as natural capital are reported as key enablers. Supply chain impacts are identified as significant even for organisations with a low direct footprint.

3. Policy barriers and competing pressures hold boards back

Policy uncertainty is the primary barrier (51 per cent), particularly the absence of national environmental standards (76 per cent). Directors also note challenges associated with environmental approvals and uncertainty surrounding the Nature Repair Market. Internal constraints include skills gaps, limited board bandwidth and financial resources. Younger directors report internal barriers more frequently. Interviews stress acting despite imperfect policy and emphasise cross-sector collaboration.

What nature-related governance looks like in practice

4. Boards adapt climate governance practices to nature

Boards commonly leverage climate governance frameworks to address nature. Among listed directors, 24 per cent have integrated nature into climate strategy and 53 per cent intend to. Updating risk frameworks is the most widespread measure (52 per cent). Directors frequently consult external experts when internal capability is limited. However, one-third of boards have taken no action and one-quarter have no plans.

5. Oversight is varied and disclosure remains patchy

Oversight structures vary: 41 per cent assign responsibility to the full board, 22 per cent to committees, and 20 per cent report no oversight. Disclosure uptake is limited, with 13 per cent aligning with TNFD and seven per cent with CSRD. Larger organisations are more likely to disclose and report higher preparedness. Preparedness varies across industries, with stronger maturity in primary industries and professional services.

6. Active boards show how risks become opportunity

‘Active’ boards are more likely to recognise nature’s importance, discuss a wider range of issues such as invasive species and nature-based solutions, and adopt structured oversight. They more frequently request strategies, recruit expertise, set metrics and targets, and prepare for disclosure. Interviewees note that early action strengthens resilience and positions organisations competitively.