Assessing nature-related financial risks in Zambia

In response to the urgent need to evaluate the vulnerability of Zambia's financial sector to nature-related risks, Genesis is leading a pivotal study that explores the intricate connection between financial stability and environmental challenges.

The study is supported by the UK Department for Environment, Food and Rural Affairs and commissioned by the United Nations Development Programme’s Biodiversity Finance Initiative (UNDP BIOFIN) Zambia.

The study covers a wide financial spectrum, including capital markets, pensions, insurance and banking. It aims to uncover vulnerabilities while emphasising the interconnected relationship between finance and nature. By acknowledging this interplay, the research paves the way for informed decision making and strategic interventions, laying a foundation for sustainable growth and resilience amid evolving environmental complexities.

Genesis brings to the project our contextual expertise in technical research and analysis, aligning efforts with Zambia’s Green Finance Mainstreaming Working Group for coordinated action. By collaborating with financial sector regulators, we are undertaking rigorous research activities, economic modelling and report writing. The focus remains on revealing the intricate linkages between natural capital, ecosystem services and the financial system, thereby deriving actionable insights on nature-related financial risks.

Specifically, Genesis will:

● Utilise economic modelling to assess the exposure levels of Zambia's financial system to nature-related risks, as well as the impact of natural capital and ecosystem services on financial stability.

● Craft high-level reports that showcase the nexus between nature and finance, steering towards proactive risk management strategies.

● Emphasise the importance of integrating nature-related risk assessments into financial decision-making processes for enhanced resilience and sustainability