7th June 2011
The latest United Nations World Water Development report says there is no question that the world's water supply is under threat.
Here are the facts, as documented by the UN:
1) Under a current business as usual scenario (i.e if nothing is done) then water demand will still outstrip supply by 40% by 2030.
2) This has the potential to put US$63 trillion of global GDP at risk by 2050.
3) The UN also believes that two thirds of the world population will live in water stressed countires by 2025.
4) Furthermore EIRIS analysis shows that 54% of companies are exposed to water risks. However less than 1% can demonstrate that they are adequately managing these risks.
5) Of companies exposed to risks only 9.7% have set short or long term targets, and only 9.7% have set water quality targets.
A shortage poses "a potentially greater threat to business than the loss of any other natural resource".
Think about it, without water many businesses or indeed services would be unable to operate.
EIRIS is urging investors to use their collective clout and become involved investors through activism.
Investors need to asses the exposure of companies to water risk and identify those sectors with the most signficiant water use and risks to water quality.
Ran Sanghera of EIRIS explains how investors can become involved:
"Investors should be demanding increased levels of corporate reporter on water as well as improvment in the quality of information that is currently being dsoclosed.
"Investors should also be encouraging companies to become aware of the opportunities and risks they face from managing or not managing water adequately by encourgating board level evalutions of water risk."
Seb Beloe, head of SRI at Henderson, blogs about the need to develop water regulation reform in the UK.
EIRIS offer shareholders information they can use to asses whether the companies they are invested in are at risk from water scarcity. For details go on the EIRIS website.
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