---
title: what system-level investing looks like at a named place
canonical_url: https://ensurance.app/guide/what-system-level-investing-looks-like-at-a-named-place
markdown_url: https://ensurance.app/guide/what-system-level-investing-looks-like-at-a-named-place.md
subtitle: own the market. fund the place under it
category: how-to
---

# what system-level investing looks like at a named place

*own the market. fund the place under it*

**System-level investing** is investing to manage the risks to the whole market, which drive its return, alongside picking which securities to hold. The Investment Integration Project (TIIP) uses the term, and Jon Lukomnik and James Hawley make the case for it in *Moving Beyond Modern Portfolio Theory* (2021). For a universal owner, the market's return rests on the system.

Under every holding in a universal owner's book are living systems: the watersheds, soils, forests, pollinators, wetlands and coasts that make the conditions companies earn in. They exist whether or not anyone holds a certificate. [**Ensurance**](/explore?from=guide) is how an owner can fund one of them, at a named place, now. It is not the place.

:::johnson
**own the market. fund the place under it.** — Stewardship moves companies. A named place needs money in its own account.

[see the stocks a market stands on →](/natural-capital/stocks?from=guide)
:::

The earlier six posts took one risk, problem or roadblock at a time. This one is four steps, a worked example, and what it does not do.

## why security selection cannot reach the system

Modern portfolio theory removes the risk that belongs to a single company. Lukomnik and Hawley's point is that it says little about risk to the market itself, which is what a diversified owner carries. Their answer is to act on that risk directly: beta activism. [The risk a universal owner cannot diversify away](/guide/the-risk-a-universal-owner-cannot-diversify-away?from=guide) sets out that argument; [what systemic risk actually is](/guide/what-systemic-risk-actually-is?from=guide) covers the different idea of a whole system failing.

Roger Urwin put the owner's side of it in 2011: a universal owner holds a slice of the whole economy, so it has reason to improve the whole market's prospects through ownership, integration and collaboration. The *Cambridge Principles* (2021) call this system stewardship: a diversified fund serves its beneficiaries by keeping healthy the economy and the environmental and social systems it depends on.

Owners already practice this, and it works on what it is aimed at.

| who | what they do | what it reaches |
|---|---|---|
| NBIM (about US$2 trillion) | Eight core nature expectations for portfolio companies: board oversight, strategy, disclosure citing TNFD, targets; risk-based divestment as escalation | Company governance and disclosure |
| PRI Spring (launched June 2024; 200+ investors, about US$15 trillion) | Engagement with 60 companies on deforestation and land degradation | Company policy on land |
| Nature Action 100 | First company benchmark, October 2024 | Company performance against a common yardstick |
| ABP | Names biodiversity loss among its systemic risks; targets at least €1 billion of biodiversity investment within €30 billion of impact investment by 2030 | A dedicated sleeve |
| Railpen | A 2026–2030 systems-stewardship strategy as a universal owner, adding nature | Stewardship priorities across the book |

Every line in that table is real and worth crediting. The claim here is narrow: these tools act on companies and on the deals a sleeve can find. A sleeve funds the deals it finds; it is not built around one place the whole book depends on.

## four steps from the book to the ground

| step | the question | the tool | what comes out |
|---|---|---|---|
| 1. Read the dependencies | What living systems does the book stand on, and where? | TNFD LEAP, ENCORE, the owner's own holdings data | A short list of places |
| 2. Pick one place | Which place do many holdings share? | The list from step 1, plus who already governs it | One named place |
| 3. Fund its condition | How does money reach the place itself? | An account addressed to the place, a certificate against it | A funded account, read every period |
| 4. Report it | How does the board see it? | The owner's existing stewardship report | One line beside engagement and voting |

### step 1: read the book down to living systems and named places

The TNFD's LEAP approach (locate, evaluate, assess, prepare) asks a company or investor to find where it touches nature, then what it depends on there. ENCORE maps sectors to the ecosystem services they rely on: water supply, flood regulation, pollination, soil quality. About 800 organizations have committed to adopt the TNFD recommendations and more than 1,000 have published TNFD-aligned disclosures, as IPE reported from its 2026 status report.

Push it one layer further. A disclosure stops at a sector and a risk rating; the owner needs the river basin, the aquifer, the forest, the coast. The same few places tend to surface under different tickers. [A disclosure is not a transaction](/guide/a-disclosure-is-not-a-transaction?from=guide) explains why the report alone moves nothing on the ground.

### step 2: pick one place that many holdings depend on

One place, not a program. The test is shared dependency: a watershed that supplies a utility, two food processors and the insurers who cover the town below is carried by the whole book. The parcels that carry the most for others have a name: [keystone parcels](/guide/what-is-a-keystone-parcel?from=guide). [The free rider is standing on a keystone parcel](/guide/the-free-rider-is-standing-on-a-keystone-parcel?from=guide) shows why nobody pays for them.

Two more tests: the condition has to be readable now, and the place already has people who govern it, such as a water district, a land trust, a tribe or a ranching family. The owner does not run it. It funds what they already keep, and only with the agreement of the people who keep it: communities, customary and Indigenous stewards, public agencies, private owners.

### step 3: fund its condition directly

This is the step the owner's stewardship toolkit does not cover, and the one ensurance adds.

1. **An account addressed to the place.** Each named place or purpose gets its own account. Money sent to it is addressed to that place, and the public ledger shows where it goes.
2. **A certificate against it.** Whether a given owner may hold one is for its trustees and counsel. A certificate is not a deed and is not a claim on the land. A policy has a cooperating titleholder; a line has no title.
3. **Proceeds fund the parcel first, then the people who keep it.** While the place is still at risk (the ensured stage), proceeds go to its capital cost: acquisition, debt, clearing claims, restoration. Once it is secure (entrust), they pay for the ongoing stewardship.
4. **Condition read every period, from now.** The account reports whether the system is functioning, not a counterfactual of what would have happened without it. Insurance pays after a loss; a carbon credit prices an avoided future; this reads the present condition. [A carbon credit is not a forest](/guide/a-carbon-credit-is-not-a-forest?from=guide) explains why that difference matters.

Every payment sits on a public ledger, so any trustee, beneficiary or rival fund can see who paid and what for. Who paid is public, which some owners will weigh. [Three ways to hold a natural asset](/guide/three-ways-to-hold-a-natural-asset?from=guide) compares this with owning land or holding an easement.

### step 4: report it in the owner's words, beside stewardship

The board needs a few more lines in the stewardship report it already reads, not a new framework.

| stewardship line today | the place line |
|---|---|
| Companies engaged on water risk in the basin | The basin's account, and what the owner paid into it |
| Votes cast on nature-related resolutions | The stage the place is in: ensured or entrust |
| Disclosures received | The condition read this period, and the last |
| Funding committed to a place at risk | What proceeds funded: land, debt, restoration, stewards |

The line does not report performance, a price or a hedge. The case for it is the series' case: the beneficiaries' market return depends on conditions like these, and few funders put money into the condition of a named place at the scale an owner holds. Whether that case belongs in a given fund's mandate is for its trustees and counsel. [Fiduciary duty and esg for a universal owner](/guide/fiduciary-duty-and-esg-for-a-universal-owner?from=guide) covers what has changed.

## a worked example

Take an owner whose step 1 keeps returning flood and wildfire under its property, utility and infrastructure holdings, and under the insurers that cover them. That dependency belongs to no single company.

On ensurance, [`risk-resilience.ensurance`](/risk-resilience.ensurance?from=guide) is a live account for that purpose, with a wallet deployed. It is an account for a purpose, not for a single parcel.

From there, step 2 narrows it. The owner opens [named places](/explore?from=guide) and [certificates](/specific?from=guide) and looks for the watershed or forest its holdings share. If the place has an account, the owner funds it. If it does not, that is a conversation with the people who govern the place about whether to open one.

The honest edge: [`water-abundance.ensurance`](/water-abundance.ensurance?from=guide) also has a wallet, while [`pollination.ensurance`](/pollination.ensurance?from=guide) is in the catalog with no wallet yet. An owner whose food holdings lean on pollinators can see the account exists, and that it is waiting. None of these is yet a single named watershed; step 2 is how an owner finds one.

The point is the path: from a dependency in the book to an address on the ground that the whole market can see.

## what this does not replace

Engagement still moves companies, voting still matters, and policy still sets the rules every holding runs under. [Divest, reprice or protect](/guide/divest-reprice-or-protect?from=guide) takes them apart. A place account sits beside all of these. It is a way to put money into one part of the system.

It is plural, not exclusive. Ensurance does not claim to represent or be the only funder of any place, and several accounts can serve one watershed. Water funds, easements and endowment-held land have done this work for decades. Governance already exists on the ground; the protocol funds and the people there govern.

## where ensurance stands today

This is small and early. On 24 October 2026 the protocol had 2,085 active accounts, 86 with a wallet deployed, 26 policies and 191 coins, with seven-day volume of about US$8. It does not solve ticket size: no universal owner can put a mandate-sized allocation through it today. [Conservation value is not the ticket size](/guide/conservation-value-is-not-the-ticket-size?from=guide) and [is nature an asset class yet](/guide/is-nature-an-asset-class-yet?from=guide) say why plainly.

What it offers now is the unit: a named place, an account, a certificate, a condition read every period, a public ledger. Accounts can be grouped into syndicates and pools; none has yet taken mandate-sized money. Nothing here is investment or legal advice.

## frequently asked questions

### what is system-level investing?

System-level investing is investing to manage the system-level risks that drive the market's return, not only choosing securities. TIIP and Lukomnik and Hawley (2021) describe it. For a universal owner the main system-level risks include the condition of the living systems the whole economy draws on.

### how is system-level investing different from esg integration?

ESG integration adjusts which securities an owner holds and how it weights them. System-level investing asks how the owner can change the risks every holding shares. Engagement coalitions like PRI Spring are one form; funding the condition of a named place is another.

### what does an owner actually hold when it funds a place through ensurance?

A certificate against an account addressed to that place. It is not a deed and not a claim on the land. Proceeds fund the parcel first and then the people who steward it, and the account's condition is read every period.

### can a pension fund do this today?

Steps 1, 2 and 4 use tools it already has. Step 3 is available now at small scale, not at mandate size. Whether a fund should do it is for its trustees and counsel; this post is not legal or investment advice.

### is this crypto?

It runs on a public ledger so that anyone can audit who paid and what for, and ensurance provides the service around it. The holder deals with an account, a certificate and a report.

## next

If you sit on a universal owner's stewardship or investment team and step 1 keeps pointing at the same place, [tell us which one](/contact?from=guide&topic=universal-owners). If you are an insurer reading the same flood and fire exposure across your book, [insurers](/solutions/insurers?from=guide&topic=universal-owners) shows how ensurance works with yours. Foundations can start at [foundations](/solutions/foundations?from=guide&topic=universal-owners), and companies with a named supply dependency at [corporations](/solutions/corporations?from=guide&topic=universal-owners).

## sources

[The Investment Integration Project (TIIP)](https://tiiproject.com/) — the term system-level investing and its definition.

Lukomnik, J. and Hawley, J. 2021. *Moving Beyond Modern Portfolio Theory: Investing That Matters*. Routledge. — Modern portfolio theory handles company-specific risk, not market risk; beta activism; system-level investing.

Urwin, R. 2011. "Pension Funds as Universal Owners." *Rotman International Journal of Pension Management* 4(1). — A universal owner holds a slice of the whole economy.

Centre for the Study of Existential Risk, University of Cambridge. 2021. *Cambridge Principles: System Stewardship for Universal Owners*. — System stewardship as service to beneficiaries.

[TNFD](https://tnfd.global/) — the LEAP approach; the 2026 status report (about 800 adopters, more than 1,000 aligned disclosures), as reported by IPE.

[ENCORE](https://encorenature.org/) — sector dependencies on ecosystem services.

[Norges Bank Investment Management](https://www.nbim.no/) — the fund's size and its nature expectations for portfolio companies.

[PRI](https://www.unpri.org/) — PRI Spring, launched June 2024: 200+ investors, about US$15 trillion, 60 companies.

[Nature Action 100](https://www.natureaction100.org/) — first company benchmark, October 2024.

ABP, nature and biodiversity policy. — Biodiversity loss as a systemic risk; at least €1 billion of biodiversity investment within €30 billion of impact investment by 2030.

[Railpen](https://www.railpen.com/) — 2026–2030 systems-stewardship strategy as a universal owner.

[Ensurance catalog](/explore?from=guide) — Read 24 October 2026: 2,085 active accounts, 86 with a wallet deployed, 26 policies, 191 coins, about US$8 of seven-day volume.

## the series

1. [what is a universal owner](/guide/what-is-a-universal-owner?from=guide)
2. [the risk a universal owner cannot diversify away](/guide/the-risk-a-universal-owner-cannot-diversify-away?from=guide)
3. [what the tragedy of the horizon costs a universal owner](/guide/what-the-tragedy-of-the-horizon-costs-a-universal-owner?from=guide)
4. [why universal owners act alone and lose together](/guide/why-universal-owners-act-alone-and-lose-together?from=guide)
5. [fiduciary duty and esg for a universal owner](/guide/fiduciary-duty-and-esg-for-a-universal-owner?from=guide)
6. [why pension funds don't invest in nature](/guide/why-pension-funds-dont-invest-in-nature?from=guide)
7. what system-level investing looks like at a named place (this post)