El Niño risks and biodiversity investing in a warming world

Intensifying El Niño events and biodiversity loss are making natural-capital resilience an increasingly important investment theme.

• NOAA assigns a 90% probability that the 2026 El Niño develops into a Super El Niño between October and December, with risks including crop failures, food shortages, supply-chain disruption, inflation and infrastructure damage.
• The IMF estimates that a typical El Niño raises global food prices by roughly 5% within a year, while Citi estimates cumulative economic losses of USD 5–7 trillion over five years, equivalent to 4.5–6.4% of global GDP.
• More than half of global GDP depends directly or indirectly on nature, and the World Bank estimates that harming nature could cause annual economic losses of USD 2.7 trillion by 2030.
• Nature-based systems such as forests, wetlands, healthy soils and biodiversity help regulate rainfall, retain water, support pollination and protect agricultural productivity; their deterioration increases economic vulnerability.
• The investment opportunity extends beyond green spending to businesses improving water management, waste treatment, resource efficiency, sustainable agriculture and resilient supply chains, with the World Economic Forum estimating up to USD 10 trillion of annual nature-positive opportunities by 2030.
• Robeco’s Biodiversity Equities strategy groups companies into solution providers, transitioning consumer companies and lower-impact material providers, illustrated by Veolia, Sprouts Farmers Market and Novonesis; Robeco aims to place 25% of the strategy under enhanced engagement.

Takeaway: Investors should view biodiversity and climate resilience as drivers of inflation, supply-chain stability and earnings rather than purely environmental concerns, while policy support and implementation at COP17 could accelerate the opportunity.