Nature Risk in the Boardroom - a dilemma scenario game
The Scenario: Nature Risk in the Boardroom
Participants were asked to vote on four nature-related dilemmas as board members of EatWell Plc, a fictional global food and beverage company, often praised for its strong climate leadership, as it strives to achieve its net zero goals. The panel of experts guided the audience through decisions impacting biodiversity and climate.
Scenario 1
EatWell has invested heavily in carbon offsetting projects within its own value chain (known as ‘in-setting’). In 2024, ecologists raised concerns about EatWell's projects, criticising the narrow focus on carbon sequestration despite significant investment. The board had to decide whether to continue these projects or wind them down in response to the environmental criticism.
Scenario 2
In 2026, Brazil's new environmental laws disrupt major supply chains, including EatWell's. A competitor's lawsuit sparked protests, raising concerns about EatWell's own suppliers. The board had to decide whether to continue operations in Brazil, despite potential legal risks, or to switch suppliers to mitigate those risks.
Scenario 3
By 2028, worsening climate crises driven by interconnected issues like heatwaves, floods, droughts, and biodiversity loss, have caused repeated business disruptions for EatWell. Frequent insurance claims have led insurers to demand either steep premium increases or self-insurance for the first £15 million of future claims. The board faced a choice between investing in supply chain resilience and negotiating with insurers or accepting higher insurance costs.
Scenario 4
By 2030, nature and climate priorities are closely linked, with mandates like TNFD becoming mandatory. EatWell re-evaluates its reliance on nature and identifies several unsustainable yet profitable product lines. Following a major ecocide case against a supplier, the board must decide whether to continue or quickly close these environmentally harmful product lines.
"There’s a direction of travel for both climate and nature, this isn’t cyclical, this is one way. The climate crisis is only going to get worse until we achieve net zero, and the nature crisis is only going to deepen until strong collective action is taken. So short-term decisions will probably come back to bite you."
Nigel Brook, Clyde & Co
Key takeaways for board directors from the session
- Climate and nature risks are inevitable, and inaction carries high costs.
- Nature and climate issues will only accelerate in future, and early adoption of frameworks like the Taskforce on Nature-related Financial Disclosures (TNFD) can give companies a competitive edge.
- There is no single solution; long-term planning must be rooted in science, regional realities, and a deep understanding of the market dynamics, both locally and globally.
Read the full event summary
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