Biodiversity risk is an emerging threat that affects firms’ cash flows based on their exposure. Its complexity and uncertainty increase investor demand for disclosure, yet managers may hesitate to provide it, creating a disclosure gap. This study examines how biodiversity risk disclosures influence investor perceptions. Using natural language processing and large language models, we identify and classify voluntary biodiversity risk disclosures in 10-K filings. We find that investor and stakeholder pressure encourages firms to disclose, which helps reduce uncertainty about their risk exposure. Interestingly, firms tend to make direct disclosures—explicit acknowledgments of risk—when they are confident in their assessments. However, investors respond more strongly to indirect disclosures, where risk is implied through business discussions. This highlights a key dynamic: while managers prefer “reliability” and wait until they are certain before disclosing risk, investors place greater value on more “relevant” early indicators, even if those signals are less definitive. This dynamic shapes how emerging risks like biodiversity are communicated in financial reporting.