Biosphere Solvency — Concept Note

This Concept Note proposes a simple, board-level framing for “biosphere solvency” — the capacity of an organisation, portfolio or territory to remain solvent, operational and financeable under stress from biosphere degradation: soils, water cycles, biodiversity, ecosystem productivity, climate–nature feedbacks and other critical ecosystem services.

The note is independent and purely descriptive. It does not create any official standard or label. It suggests a vocabulary and a set of questions that boards, supervisors and risk leaders may use to structure their internal discussions.

This text does not describe any product, platform or service. It only describes the concept and the underlying domain name BiosphereSolvency.com, which may be acquired by a legitimate organisation.

1. Definition — What is “Biosphere Solvency”?

In this note, biosphere solvency refers to the ability of a company, financial institution, portfolio or territory to remain solvent and financeable when key functions of the biosphere are under stress. The emphasis is not on environmental performance as such, but on financial soundness and going-concern capacity as ecosystems change.

For the purposes of board discussions, the biosphere can be understood as the ensemble of living systems and supporting cycles that underpin economic activity, including for example:

• Soil fertility and agricultural productivity
• Freshwater availability and stability of water cycles
• Biodiversity and ecosystem integrity (terrestrial, freshwater, marine)
• Pollination and other critical ecosystem services
• Forest cover, coastal protection and flood buffering
• Climate–nature feedbacks (e.g. forest dieback, ocean warming and acidification)

Under a biosphere solvency lens, the central question becomes: how sensitive are our cash flows, balance sheet and funding costs to shifts in these biosphere functions, over relevant time horizons?

2. Context and drivers

Several recent developments have pushed nature and biosphere risks closer to the solvency debate:

• Nature-related risk frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD) and emerging science-based targets for nature encourage organisations to map dependencies and impacts on nature alongside climate factors.
• Prudential and supervisory discussions increasingly explore how physical climate risks, biodiversity loss and ecosystem degradation could affect credit risk, market risk and insurance underwriting, including via supply chain disruptions, asset impairment and higher claims ratios.
• Policy and legal developments around deforestation-free supply chains, water stress, pollution and restoration can translate biosphere degradation into transition risks, stranded assets or rising compliance costs.
• Macroeconomic and fiscal impacts of ecosystem decline may influence sovereign risk profiles, infrastructure resilience and long-term growth assumptions, with potential feedback into solvency positions.

In this context, the phrase “Biosphere Solvency” can be used as a compact way to signal that the organisation is looking beyond traditional ESG metrics and integrating biosphere change into core solvency thinking.

This note does not endorse any particular framework, standard or dataset. It simply recognises that boards may wish to connect ongoing work on climate, nature and financial risk under a single solvency-oriented banner.

3. Possible uses of this framing

The term “Biosphere Solvency” can be used in different ways, depending on the mandate and ambition of the organisation. Potential applications include:

3.1 Internal governance and board discussions

• Structuring board-level conversations around nature-related solvency risks.
• Clarifying responsibilities between risk, finance, sustainability and strategy teams.
• Setting expectations for management on how biosphere factors should be considered in planning.

3.2 Risk management and stress testing

• Designing biosphere–solvency stress tests that explore how severe ecosystem degradation, water stress or biodiversity loss could alter default rates, loss-given-default, claims, investment performance or funding spreads.
• Mapping sectoral and geographical concentrations of exposure to biosphere-dependent activities (e.g. agriculture, forestry, fisheries, food processing, mining, tourism, infrastructure).
• Assessing the resilience of collateral values, business models and supply chains to plausible biosphere scenarios.

3.3 Strategy, portfolio steering and engagement

• Identifying business lines, regions or counterparties where biosphere trends may materially affect long-term solvency or licence-to-operate.
• Informing portfolio steering, underwriting strategies, investment mandates and capital allocation decisions.
• Supporting dialogue with clients, investees, supervisors and rating agencies on how biosphere issues are incorporated into solvency thinking.

3.4 Disclosures and communication

• Using the phrase “Biosphere Solvency” as an overarching narrative in voluntary publications, investor presentations or nature-related reports, where appropriate.
• Linking existing climate and nature disclosures to solvency-relevant metrics and scenarios, without creating new regulatory categories.

In all these cases, the framing could help organisations make explicit how biosphere change is considered within their existing risk management and solvency processes. It does not prescribe any particular methodology or metric set.

4. Limitations of this note

This Concept Note has several important limitations:

• It is not an official standard, taxonomy or supervisory expectation. It does not replace laws, regulations, supervisory guidance or accounting rules.
• It does not define capital requirements, risk weights, provisioning rules or any prudential parameters.
• It does not provide detailed methodologies, data templates or implementation roadmaps. Organisations remain responsible for choosing appropriate tools, models and expert advice.
• It does not give assurance on the materiality, time horizon or probability of specific biosphere-related risks for any given entity.

Any organisation considering the integration of biosphere factors into its solvency framework should seek its own independent legal, financial, scientific and risk expertise, and carefully align with applicable laws and supervisory expectations in the relevant jurisdictions.

5. About this site

This site does not operate any service, platform, community or programme. It does not collect user data beyond what is strictly necessary for basic web hosting and security.

It only presents the “Biosphere Solvency” concept and the underlying digital asset BiosphereSolvency.com, which may be acquired by a legitimate organisation wishing to develop its own frameworks, observatories or governance tools.

Any future use of the domain name, including the creation of services, platforms or tools, would be entirely the responsibility of the acquiring organisation and outside the scope of this note.

6. Legal & risk disclaimer

This text is provided for general information purposes only. It does not constitute legal, financial, regulatory, tax, scientific or investment advice and should not be used as the sole basis for any decision.

Nothing in this note should be interpreted as:

• an offer or solicitation to buy or sell financial instruments,
• a rating, opinion or assurance on the solvency of any entity,
• a statement of regulatory expectations or supervisory guidance,
• a recommendation regarding capital allocation or risk appetite.

Organisations should obtain their own independent legal, prudential, scientific and risk advice before making decisions related to biosphere risks, solvency, capital or strategy.