Pressure on fresh water is at an all-time high, and climate risks are intensifying these challenges. This year, many industries across the economy experienced negative financial impacts due to extreme droughts and flooding—fromThese risks pose financial threats to investment portfolios, business operations, and the long-term stability of markets.
By aligning their business strategies with key principles for responsible water use—including protecting water quantity and quality and fresh water for ecosystems and communities—companies can accelerate their progress toward minimizing financial risks in the face of growing water scarcity and pollution. But to do this, they need to bridge significant gaps, including the following:For many sectors, supply chains account for the vast majority of the water companies use.
But investors are working with companies on expanding action to assess and tackle water risk in their supply chains. Consider that Domino’s Pizza—the largest pizza chain in the world—is now assessing water risk in its supply chain andIndustry, which needs clean water to produce food, energy, and manufactured goods, has an outsized impact on clean water supplies.
Companies leading the way are also reporting how they are preventing release of industry “pollutants of concern” or contaminants such as pesticides and fertilizers, dyes and pigments, heavy metals, and chemicals including PFAs and BPA—into water supplies., equivalent to 60% of global GDP. Water and ecosystems are inextricably linked. Ecosystems that need water to thrive also help filter and store water supplies that companies and communities need.
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