Thursday 20th October 2016                 Change text size:

Water management behind climate change on boardroom agenda


Water management is a lower priority than climate change in boardrooms, despite it posing a significantly greater near-term threat. Alex Blackburne reports.

A Carbon Disclosure Project (CDP) report, released today, has found that out of the 190 Global 500 companies that responded to the research, 109 (57%) report board-level oversight of water policies, strategies or plans.

These figures from the Water Disclosure Global Report come after a September 2011 CDP report found that 93% of 2011 respondents reported “board or senior executive oversight for their company’s climate change program“.

The two statistics prove that some of the world’s most profitable businesses have their priorities in the wrong camp, with the risks and opportunities derived from water management much more near-term.

In fact, 59% (113) of respondents “report exposure to water-related risk and over one third of respondents have already suffered recent water-related business impacts, with associated financial costs as high as $200m“, the report states.

The risks – namely flooding, scarcity, and reputational damage – are clear and right on the companies’ doorsteps, with 64% of risks in direct operations and 66% in the supply chain identified as occurring between now and 2016.

“Some of the largest multinational companies have experienced the detrimental effects that water can have on their bottom line“, said Paul Simpson, chief executive officer at CDP.

We need to see more companies understand that water is a critical issue, requiring greater board-level attention than it currently receives.

“Those corporations that navigate the challenges effectively will be able to profit from the significant opportunities that result from a robust water strategy.”

Whilst a lot of the emphasis, funding and energy within large corporations are on climate change, the CDP report has highlighted the wider issues in terms of sustainable living, stressing the importance of water management techniques to run alongside current methods.

To view the report in full, click here.

If you would like to find out more about investing in companies that strive to manage their water usage, ask your financial adviser, if you have one, or complete our online form and we’ll connect you with a specialist ethical adviser.

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