Launched in August 2022, Ceres’ Valuing Water Finance Initiative (VWFI) is a new global investor-led effort to engage 72 of the largest corporate water users and polluters to value and act on water as a financial risk and drive the necessary large-scale change to better protect water systems.
The availability of clean water represents a major systemic risk and challenge facing institutional investors and financial institutions worldwide. Water is a unique resource that underpins all drivers of economic growth: food production, energy generation, industrial activities, human health and political stability. Yet, water is chronically mismanaged in much of the world, and the accelerating physical impacts of climate change are making water supplies increasingly unstable. Investors and financial institutions with exposure to large industries across the world face potentially large--and often unrecognized-- water risks.
Anne Simpson, Ceres Board Member and Global Head of Sustainability at Franklin Templeton, states “The world’s fresh water supply is under severe stress in all regions, which poses risks not just to local communities, but also to those companies reliant upon water across their value chains. Investors have a critical role to play in helping companies assess those risks, and to respond to the opportunities ahead as we build resilience to climate change. The Valuing Water Finance Initiative reflects investors’ fiduciary duty to generate sustainable risk-adjusted returns on behalf of the millions of people who rely upon those investments for their financial security. Benjamin Franklin wisely commented that ‘when the well is dry, we know the worth of water.’ We are perilously close to that point and as fiduciaries must act.”