Kirsty Wilman asks, in a natural capital asset class still taking shape, who is building it – and does it matter?
Natural capital has moved from concept to allocation. Pension funds and institutional investors are not simply talking about nature – they are allocating capital to it. The norms being written now, about what counts as credible, who gets a seat and what expertise looks like will shape this market for a long time. And unlike the asset classes that came before it, this one has a genuine choice about where it looks for that expertise.
Close to 60% of UK institutional investors now see nature restoration and climate adaptation as inseparable, according to the Mallowstreet 2026 Natural Capital Report, representing more than £3trn (€3.43trn) in assets. Institutional capital is beginning to move, and a new asset class is taking shape. The investment industry is being built from offers a clear lesson. Not in how to replicate what came before, but in what to do differently.
The investment industry has spent decades trying to fix a historic diversity problem. Infrastructure has the lowest female workforce representation of any sector tracked by the World Economic Forum, at just 22.4%. Only 12% of UK fund managers are women. In private equity and venture capital, women hold 10% of senior roles. Female representation in senior UK financial services roles is rising at just one percentage point per year. The effort is real but the progress is not. That is what happens when diversity is treated as a problem to solve rather than an asset to build with from the beginning.
Natural capital is not a carbon copy of those investment markets. Managing a forest, a peatland or a floodplain is not the same as managing an engineered asset or a corporate balance sheet. It requires ecology, hydrology, soil science, land management and agriculture. It also requires the ability to work with the communities whose livelihoods, knowledge and relationships with the land are inseparable from the assets being restored.
Those communities bring perspectives that no amount of financial modelling replicates – an understanding of how landscapes have been used, what has worked, what has failed and why. That breadth of opinion and lived experience is not peripheral to the investment case. It sits at the centre of how these assets are underwritten, structured and managed. The talent pool this market needs reaches well beyond financial services. The talent it needs happens to sit outside traditional finance networks; therefore, the structural barriers that kept those networks narrow are specifically damaging here, not just generally unfair.
Natural capital does not have to start from the same structure that produced financial services’ diversity problem. Recruiting honestly for the skills this work requires means drawing from a broader, more diverse pool. But that only works if the culture is built to welcome differing skill sets, and to accept that expertise has to be built in areas where you have none. It requires teams that are deliberately assembled and cultures that treat unfamiliar expertise as an asset rather than a gap. The structural barriers that have historically constrained who gets to build new markets are well documented, and they matter here precisely because they risk narrowing the talent and perspective this asset class needs at the moment it needs them most.
For me, that has meant bringing financial services experience across operations, structuring and transactions while learning what nature can actually deliver. For others, it means getting to grips with how investment structures and capital markets work. The learning runs in both directions, and that is the point.
The performance case for diversity is well evidenced. McKinsey’s 2023 analysis found that companies in the top quartile for board gender diversity are 27% more likely to outperform financially. BCG research across more than 1,700 businesses found that greater leadership diversity generates 19% more revenue from innovation, with EBIT margins nine percentage points higher than less diverse peers. The causal relationship is contested, but the directional evidence is consistent enough to take seriously. This is not a values argument. It is a construction argument. Build with the full range of available expertise, or accept a weaker result. In a market where the communities most connected to the land are also among the most diverse, narrowing who contributes to the investment process is not just a missed opportunity. It is a structural weakness.
For those building and allocating to natural capital strategies, the questions are direct. Are we widening recruitment beyond the networks that produced the existing imbalance? Are we designing teams that reflect the full breadth of expertise this asset class requires, including the voices of the communities these investments affect? And for allocators conducting due diligence, are you asking about leadership composition and talent pipeline alongside track record, governance, and risk – not as a box-tick but as a signal of whether a team has been deliberately built for what this work demands?
My challenge is driven from working in male-dominated industries where finance credentials were the only ones that counted, and where cultural defaults narrowed who stayed. I have also seen the difference that deliberate choices make when teams are built with inclusion from the start, and the results are infinitely better.
Natural capital presents a rare opportunity. The fund structures, the standards, the networks and the cultures of this market are still in formation. The question is not whether this market will exist – it is who will have built it, and whether anyone was deliberate enough to build it well.
To read the latest IPE Real Assets magazine click here.
