A new report from the University of Sydney Business School and the Australian Institute of Company Directors reveals a significant gap between awareness and action regarding nature-related risks among Australian board members. The study, titled “Nature Enters the Boardroom,” found that 80 per cent of directors consider nature-related risks a key consideration, but only 20 per cent report their boards are actively addressing them. The research represents the first Australian study on how directors integrate nature into governance, strategy, and risk oversight.
The study surveyed 250 non-executive directors and chairmen across Australia. It also included detailed interviews with 12 senior directors from various organisations, including listed, private, not-for-profit, and government entities. The findings indicate that directors are in the early stages of addressing nature-related risks but increasingly acknowledge the potential financial and operational impacts. These include supply chain vulnerabilities, increasing cost pressures, and asset exposure.
According to the report, policy uncertainty is a major barrier preventing boards from confidently evaluating and responding to these risks. Professor Clinton Free, who led the study along with PhD candidate Darya Boukata, stated that the research highlights a gradual change in boardroom priorities. Some organisations are starting to integrate climate and nature considerations into their strategic planning and risk management processes.
This shift suggests a growing recognition of the importance of environmental factors in ensuring long-term business sustainability and resilience. However, the study also underscores the need for greater clarity in policy and regulation to enable more effective action by company boards. Further resources and guidance are needed to help directors navigate and mitigate nature-related financial risks.
