Water Scarcity and Climate Change: Growing Risks for Businesses and Investors

Water Scarcity and Climate Change: Growing Risks for Businesses and Investors (2009)

This report looks at the impact of water scarcity and declining water quality on business and the significant interest investors have in catalyzing companies to look more closely at their potential risk exposure to water-related challenges.

Primary Functions

  • Learn about the wide-ranging risks investors and companies face from water scarcity and how global climate change will heighten those risks in many parts of the world.
  • Understand how companies will benefit by treating pressing water risks as a key strategic challenge.
  • Find a list of key questions investors should ask to assess companies’ ability to anticipate and respond to water-related challenges and transform them into opportunities.

Detailed Description

 

Water is crucial for the economy. Virtually every industry from agriculture, electric power and industrial manufacturing to beverage, apparel, and tourism relies on it to grow and ultimately sustain their business.

Yet water is becoming scarcer globally and every indication is that it will become even more so in the future. Decreasing availability, declining quality, and growing demand for water are creating significant challenges to businesses and investors who have traditionally taken clean, reliable and inexpensive water for granted. These problems are already causing decreases in companies’ water allotments, shifts toward full-cost water pricing, more stringent water quality regulations, growing community opposition, and increased public scrutiny of corporate water practices.

This Ceres/Pacific Institute report concludes that climate change will exacerbate these water risks, especially as the world population grows by 50 million a year.

The report highlights the intensifying conflict between energy use and water availability. With increasing frequency, choosing one of these resources means undermining the other – the other, usually being water. For example, the billions of dollars spent to expand oil sands development in Canada and corn-based ethanol production in the U.S. has incrementally increased fuel supplies, but at the expense of significant water impacts and greenhouse gas emissions that could ultimately limit these ventures in the future.

This report, done at the request of the Investor Network on Climate Risk, outlines the wide-ranging risks investors and companies face from water scarcity and how global climate change will heighten those risks in many parts of the world.

The report makes clear that companies that treat pressing water risks as a key strategic challenge will be far better positioned in the future. Companies that continue to ignore these challenges put themselves at higher risk.

Additional information

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