Stockholm (NordSIP) – On August 15, Storebrand Asset Management published a report focused on water-related sustainability issues. In order to do so, Storebrand partnered up with and the international NGO Norwegian Church Aid. The publication draws attention to the severity of the water crisis, and aims to increase knowledge on the topic, in the hope to mobilise companies to ensure good water stewardship and take concrete action towards the 6th UN Sustainable Development Goal (SDG), Clean Water and Sanitation. It also illustrates that new forms of partnership in general are essential in achieving the UN’s Sustainable Development Goals by 2030.
“Today many companies address carbon and climate risk, which is of course important,” says Matthew Smith, Head of Sustainable Investment at Storebrand Asset Management, “however the time has come for the business community to also take a serious look at water related risks affecting organizations.”
The first part of the report consists in series of case studies presented by the Norwegian Church Aid organisation, which take the reader through concrete issues in Pakistan, South Africa, Ethiopia and Brazil.
In the second part, Karin Gjerde-Meyer, Sustainability Analyst at Storebrand Asset Management contributes an insightful analysis of how the risks introduced by the case studies can impact investments, as well as the opportunities that arise from resolving the issues.
Smith says: “Water risk analysis is often focused on scarcity, which the main problem. However, flooding’s has become more extreme and more costly and must be taken in consideration too. Regulatory risks are also risks that are undervalued. If the risks aren´t managed well, the results may be operational disruptions, production stops, fines and loss of profit.”
Investors rely mostly on the companies’ own work on the assessment of water-related risks. “As an investor, we depend on company transparency and encourage companies to evaluate and report on water risk and management,” Smith continues. “Companies addressing water risks properly are wiser investments as are companies providing solutions to the water crisis.”
In its conclusion the report draws attention to the fact that poor water management processes cause societal conflicts and increase inequalities between individuals, industries and countries. Smith stresses the urgency of the situation: “If risks associated with extreme water situations are not handled immediately the consequences will be catastrophic,” he says.
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