The duty to act with due care and diligence obliges board members to act on an informed basis and in good faith. This is demonstrated by the way in which they exercise their skills and judgement on the matters before them.4 Such action requires thoroughness, objectivity and the capacity to robustly and proactively question assumptions, as well as being sufficiently informed to assess the options available and the implications of decisions. Without this foundation of understanding, oversight of current and anticipated financial effects cannot be undertaken with the necessary diligence, and the present principles of oversight, risk and opportunity, strategy and disclosure cannot be enacted with confidence. Foundational capability → Board members are not expected to be climate scientists or nature experts. What matters is having the proficiency to robustly question how climate change and nature loss may affect the organization, including its business model, sector and geography. A baseline understanding of climate and nature is essential, enabling all directors to engage meaningfully in debate. When knowledge is limited and information is complex, decision-makers may be more vulnerable to cognitive shortcuts or biases that restrict the effectiveness of action.5 As such, intellectual curiosity and openness to new evidence are critical boardroom mindsets that support rigorous oversight and long- term judgement. Further, engagement with climate and nature enables board members to: –Apply governance in contexts where risks are systemic, non-linear and not easily extrapolated from historical patterns –Recognize how dependencies on natural systems influence supply chains, markets and access to capital –Exercise judgement about which climate- and nature- related actions require a compliance lens and which demand transformationThese capabilities allow board members to interrogate risks and opportunities in the short, medium and long term and provide more rigorous oversight of strategic direction. Oversight of management capability → With this foundation in place, boards are better positioned to assess whether management has the skills and knowledge required to effectively integrate climate and nature considerations into the organization’s strategy and operations. They can also evaluate whether management has the capability to deliver on that integration. This includes oversight of how capability gaps are addressed, when external expertise should be engaged and how insights are incorporated into decision-making. Recruitment and succession planning at both board and executive level also play a role in closing gaps and sustaining a balanced mix of skills and mindsets to interrogate strategic choices. The relevance of climate and nature skills → and knowledge Board members strengthen governance when they interrogate the assumptions, models and scenarios that underpin the organization’s vision, strategy and operational plans. Intellectual curiosity, analytical rigour, cross-disciplinary fluency and commercial reasoning under uncertainty all support this function. Continuous learning across policy, markets, regulation and technology enhances foresight and improves the quality of decisions. Climate and nature capability is best understood as the intersection of knowledge, skills, mindset and experience, and it is this combination that enables boards to steward their organizations through resilience, innovation and transformation. Guiding questions for board reflection Question 1: To what extent is the board collectively equipped to understand and robustly challenge relevant climate- and nature-related risks and opportunities across different time horizons? Question 2: What formal process (e.g. board skills matrix, board evaluation) do we use to identify knowledge gaps, benchmark our capabilities against peers and address blind spots through training, recruitment or external advisory support? Question 3: How do we confidently evaluate whether the business has effective systems to integrate climate and nature issues into strategy, capital allocation and operational decisions? Question 4: How do we oversee that our executive team is incentivized and has the resources and capabilities needed to manage climate and nature risks and pursue related opportunities? Question 5: What systems and processes are in place to facilitate critical climate and nature decisions reaching the board when required? Guiding questions for boards to ask of management Question 1: How is the organization building and maintaining the skills, expertise and awareness needed to manage climate- and nature- related risks and opportunities across management and teams? Question 2: How are insights from internal and external experts on climate and nature incorporated into decision-making? Board Leadership for Growth and Resilience 10

Board Leadership for Growth and Resilience 2026