Natural resources are a boon to the economy. Well managed, they can boost development prospects. But their management means taking into consideration environmental, social and governance (ESG) factors.
The natural capital of a country will increasingly be safeguarded by policies aimed at containing climate change and helping transition to a greener economy. These policies could include, for example, stricter anti-deforestation laws or laws that restrict the use of land, which may limit amounts and types of produce that can be cultivated and exported. In doing so, such policy action generates a transition risk that is still poorly understood. This matters.
