ESG Watch: New study sounds alarm about risk of stranded assets due to water scarcity
For something that is so crucial to all aspects of life, including the most fundamental business operations, water risk is a blind spot for many investors and businesses. There is little understanding of how overuse, pollution and increasingly frequent extreme weather events, such as the years-long drought in California, the recent heatwave in India and Pakistan, and last year’s floods in Europe, are affecting water availability, says Cate Lamb, global director of water security at disclosure not-for-profit CDP. A third of listed financial institutions do not assess exposure to water risk in their financial activities, although 69% of listed equities told CDP in 2021 that they are exposed to water-related risks.