Just nature: aligning environmental action with social equity

This is the third of our just nature blogs that addresses that in the race to net zero and a healthy planet, nature has too often been the silent partner – essential to sustaining life, yet consistently undervalued in policy and investment decisions.

While climate change rightly dominates headlines and boardroom agendas, the parallel crisis of nature loss has unfolded more quietly, despite its profound implications for people and the planet.

As the connections between nature, climate, and social outcomes become increasingly evident, integrating just nature into environmental strategies is not just responsible – it is essential for building resilient portfolios and sustainable economies.

Today, there is growing recognition that companies need a strategy for managing nature risks and impacts, similar to their plans for addressing climate change. At the same time, nature-based solutions are not just helpful but essential to achieving net zero. Yet what remains underexplored is how these solutions are implemented - and for whom.

If we fail to consider who benefits, who bears the costs, and how communities are engaged, we risk repeating patterns of environmental injustice. Embedding equity, inclusion, and social value into the way we restore and protect nature is not optional – it is fundamental.

What does ‘just nature’ mean?

‘Just nature’ is more than a slogan – it’s a framework for considering how justice, nature, and sustainability intersect. It means ensuring that efforts to conserve and restore nature are fair, inclusive, and socially responsible. It involves supporting local communities, Indigenous peoples, supply chains, and workers who are directly affected by nature-related decisions.

This approach aligns with the broader goals of a just transition - ensuring that environmental policies do not disproportionately impact vulnerable communities and that the benefits of a greener economy are widely shared.

The cost of ignoring nature

Nature is not just a backdrop to human activity – it is the foundation of our economies, health, and well-being – you can read more in our hidden cost of nature loss article which can be found in the related content section.

The financial system has historically failed to account for the true value of nature. This oversight has led to capital being allocated in ways that degrade ecosystems – through deforestation, overfishing, pollution, and unsustainable land use. These environmental costs often translate into social costs, particularly for the billions of people, especially in low- and middle-income countries, who rely directly on nature for their livelihoods.

From smallholder farmers and fishers to indigenous communities and informal workers, many are engaged in activities that are both nature-dependent and highly vulnerable to ecological decline. When nature is degraded, these communities face job losses, food insecurity, displacement, and reduced resilience to climate shocks.

Who is affected?

There are four main groups that can be affected by a company’s nature transition.

Illustrative example of considerations for a company’s just nature transition plan

• Workers: Shifts to sustainable practices and nature-related changes can disrupt jobs. For example, phasing out harmful chemicals or switching materials may eliminate some roles. Companies must support workers through retraining and upskilling to ensure long-term resilience.
• Supply chains: Companies may switch suppliers during a nature transition to meet growing expectations for sustainable practices like regenerative agriculture. However, without proper training and financial support, suppliers, especially in rural or low-income areas, risk economic hardship.
• Communities: Local and Indigenous communities near operational sites may be impacted by developments like solar farms or dams. These projects may be good for the environment but can disrupt access to land and water, essential for livelihoods and cultural traditions. Failure to engage these communities and consider their needs not only leads to social inequality but can lead to protests, legal challenges, and reputational damage.
• Customers: Nature transitions may increase production costs, affecting affordability. For example, switching to more sustainable materials or farming methods might increase production costs. Companies should be mindful of how they are managing these impacts and communicate how they are managing affordability and access.

What are we doing?

At Royal London Asset Management, we are helping to elevate the social dimensions of nature by actively advancing the concept of ‘just nature’ through our stewardship and investment practices. Building on our work on the just transition, we are looking at how our investments are environmentally responsible, socially inclusive, and economically resilient. There are clear steps investors can take:

• Integrate social inclusion into nature and biodiversity research – metrics such as community engagement, land rights, and fair labour practices are as relevant to green investments as to brown ones.
• Prioritise nature-based solutions that deliver co-benefits for local communities, and ensure these are co-designed with those most affected, including workers and Indigenous peoples.
• Apply just nature principles when assessing company plans to ensure nature action is also fair.
• Bring a social lens to stewardship: ask companies how they assess social impacts, whether they uphold free, prior and informed consent, and how they plan to embed fairness and justice into their biodiversity strategies.

We have organised engagement meetings with companies to introduce the concept of just nature and encourage them to build a stronger understanding of how nature can be protected in a fair and responsible way. We are conducting in-depth research and tracking how companies address the needs of communities, workers, supply chains, and consumers.

Insights from these engagements will inform the development of clear investor expectations focused on increasing transparency and accountability around nature-related risks and opportunities, while supporting sustainable development that benefits both people and the planet.

Looking ahead

Protecting and enhancing nature value is not just about preserving biodiversity – it is also about protecting people. A just nature approach means making sure that no one is left behind as companies take steps to become more sustainable.

As the connections between nature, climate, and social outcomes become increasingly evident, integrating just nature into environmental strategies is not just responsible, it is essential for building resilient portfolios and sustainable economies.

We invite clients, asset managers, and investee companies to join us in shaping a just nature transition – one that uplifts people, protects ecosystems, and builds long-term value.

Our voting, engagement, research, and advocacy activities are designed to be pragmatic, informed by evolving market insights and local best practices, and always aligned with the long-term interests of our clients. These activities aim to enhance the value and integrity of our investment decisions.

Please note that voting and engagement practices may not apply uniformly across all Royal London Asset Management funds or strategies, as each has distinct investment objectives. For details specific to your investment, please refer to the relevant fund prospectus.

For professional investors only. This material is not suitable for a retail audience. Capital at risk. This is a financial promotion and is not investment advice. Past performance is not a guide to future performance. The value of investments and any income from them may go down as well as up and is not guaranteed. Investors may not get back the amount invested. The views expressed are those of the Royal London Asset Management at the date of publication unless otherwise indicated, which are subject to change, and is not investment advice.