“Devastating droughts in California, Brazil, South Africa and elsewhere, coupled with global trends of groundwater depletion and water quality degradation are motivating investors to become more water aware.
Drought in many regions is causing commodity prices for key ingredients to spike or is translating into higher energy costs, with both economic and societal ramifications. South Africa’s extreme heat and minimal rainfall, for example, are crushing crop production, forcing millions to go hungry and dropping the share value of major food producers. Illovo Sugar recently reported a 36.5 percent drop in full-year profit due to the drought. Mining companies BHP Billiton and Valle recently faced over $5 billion in regulatory fines due to a massive tailings pond spill in Brazil that devastated entire communities. Water-related risks like these are beginning to catch investors’ attention on a hotter, more crowded planet.
With support from The Rockefeller Foundation, Ceres leverages the power of institutional investors, who own or lend to many of the world’s largest companies, to play a more decisive role in protecting the Earth’s freshwater resources. Education is a critical component of this work as many investors are just beginning to understand escalating water risks and their far-reaching impacts on financial returns and ecosystems alike. Recently, Ceres surveyed dozens of global pension funds and fund managers on their strategies for integrating water analysis into investment decision-making, and found that their current practices fell far short in light of growing water risks…”
Read on at: The Rockefeller Foundation.