Alaa Abdellah

Biodiversity loss is increasingly recognized as an environmental and financial risk, yet evidence remains limited on how biodiversity-related corporate disclosure influences individual investment decisions. This study examines how biodiversity disclosure affects environmental perceptions, financial risk perceptions, and portfolio allocation. A between-subjects experiment was conducted with 106 young Generation Z participants in Egypt, who allocated a hypothetical investment portfolio between a higher-return company and a lower-return alternative. Participants in the treatment condition received additional information indicating that the higher-return company’s supply chain contributes to biodiversity loss. Guided by the Situation–Actor–Process–Learning–Action–Performance (SAP–LAP) framework, the results show that biodiversity disclosure increased environmental salience (Cohen’s d = 0.72) and perceived biodiversity impact. At the same time, perceptions of the company’s long-term financial risk did not differ significantly between conditions. Portfolio allocation to the company associated with biodiversity impacts increased by 4.4 percentage points. However, the difference was not statistically significant (p = 0.22). The findings indicate that biodiversity disclosure influenced environmental perceptions without producing a corresponding change in financial risk perceptions or portfolio allocation. The results highlight the distinction between recognizing ecological harm and incorporating biodiversity considerations into financial decision-making. Biodiversity disclosures that connect environmental impacts with financially material consequences may provide greater decision relevance for investors. The study contributes experimental evidence on individual responses to biodiversity information and identifies directions for future research using larger and more diverse samples, incentivized investment decisions, and alternative disclosure formats.