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Water risks are still not being managed well

It might be a bold statement to make, but a new report from Ceres, reported on by Socialfunds.com, notes that among big companies with water liabilities analysed :

“73 of the 100 companies disclosed some level of exposure to water risks, “the vast majority of these disclosures consist of vague, boilerplate language. They fail to reference specific at-risk operations or supply chains, and do not attempt to quantify or monetize risk,” according to the report.

Clearly, companies with major water liabilities are going to need to raise their game, if the evidence offered by Socialfunds.com, taken from the report, is anything to go by:

“Furthermore, while two-thirds of the companies reported data on total water use, only 17% reported this data on a local level. Only 21 companies disclosed quantified water reduction targets. No companies provided comprehensive water performance data for their supply chains.

Despite the reputational risks associated with water-intensive projects, the report also found that engagement with key stakeholders was weak as well, with less than one-third of companies consulting with stakeholders on water impacts.”

Of course the vast majority of investors take no notice of these kinds of risks, so it’s doubtful share prices will suffer in the short or even medium term, if companies ignore water risks.

Over the longer term of course, which is how companies building facilities dependent on water use must look at things, water is going to be a very serious business issue indeed. Here’s an interesting book on the topic.

Water may constitute a greater geo-political risk for companies and countries alike, than nuclear weapons, over the next fifty years, if the numbers are right.

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