Risk, Return and Responsibility

Risk, Return and Responsibility – Episode 9: Reaching Common Ground on Natural Capital

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In this episode, Rebalance Earth’s Rob Gardner explains why institutional investors must view nature as "living infrastructure" to mitigate systemic climate risks and secure long-term, performance-linked returns.

Risk, Return and Responsibility — the monthly podcast from Sustainable Investor — provides institutional asset owners with the news and views shaping the sustainable investment landscape and our wider economic and social systems.

Recorded in the first week of March 2026, this episode features former UK pensions minister Guy Opperman and Sustainable Investor Editorial Director Chris Hall in conversation with Rob Gardner, CEO and Co-founder of Rebalance Earth. Gardner discusses his own transition from traditional investment consulting to becoming a "natural capital champion”, arguing that restoring nature is a matter of economic self-interest. The discussion delves into how nature-based solutions can outperform engineered alternatives in managing physical climate risks, while also delivering returns to institutional portfolios.

With reference to several of Rebalance Earth’s own projects, it outlines how capital flows for nature protection and restoration can be unlocked through aligning shared commercial interests, but does not shy away from the complexity of working with multiple parties, and the need for greater public-private understanding – and action - common challenges.

Guests
  • Rob Gardner: CEO and Co-Founder of Rebalance Earth
  • Guy Opperman: Former UK Pensions Minister and host
  • Chris Hall: Editorial Director of Sustainable Investor
    • Interview Highlights
    • Nature as Living Infrastructure: Gardner argues that nature restoration must be viewed through the lens of economic self-interest and "team Earth's" resilience rather than mere philanthropy or altruism. By framing nature as "living infrastructure", it becomes clear who benefits from its maintenance, crystalising payment flows and ultimately investment returns. Biological assets, such as oyster reefs, can be viewed as performing infrastructure that provides high-value services, including water purification, marine biodiversity restoration, and cost-effective coastal defences.
    • Performance-linked Returns: One promising investment model being pioneered by Rebalance Earth focuses on ‘payments for ecosystem services’, where corporate off-takers like Nestlé Purina pay for specific outcomes such as cleaner water and marine biodiversity restoration. This creates a financial return that flows back to pension funds, such as the West Yorkshire Pension Fund, based on the reef's performance.
    • Addressing Systemic Risk: Gardner notes that peak rainfall in the UK has increased fivefold since 2010, posing a systemic threat to property and infrastructure. He argues that asset owners should allocate 2–5% of portfolios to natural capital to enhance the resilience of the physical assets — such as homes and railways — that their members rely upon. Such investments can provide a “natural hedge” for portfolios that are at risk from the physical risks of climate change at a time when information on adaptation actions across major asset classes is scarce.
    • The Evenlode Project – Scaling Up: The podcast highlights the latest stage of the Evenlode Landscape Recovery Project, west of Oxford. Rebalance Earth is providing catalytic capital to unlock £50 million in private investment alongside public funding to pay farmers for "landscape recovery". This project aims to create "sponge landscapes" that reduce flood risk, delivering maintenance cost savings for major infrastructure operators like Network Rail and power utility SSE.
    • The LTAF Opportunity: Gardner suggests that the Long-Term Asset Fund (LTAF) structure is an ideal "sweetie shop" for defined contribution and local government pension scheme funds to access a balanced portfolio of sustainable forestry, regenerative agriculture, and ecosystem services. He also describes the path from the sweetie shop to a global megastore for natural capital.
      • Embracing the Fosbury Flop

      The conversation concludes with the analogy of the ‘Fosbury Flop’, with Gardner suggesting that the investment industry needs a similar leap in logic to address climate change. By moving away from viewing nature as an "add-on" and instead integrating it into the core definition of infrastructure, he argues the UK can lead the world in nature restoration. With more pension assets in the UK than total GDP, the shift toward a 70% private-capital funding model for landscape recovery offers a clear path toward both national resilience and institutional alpha.

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      Risk, Return and ResponsibilityBy Asset Owner Network