What You Need to Know
Water security poses a significant challenge across the globe — requiring a way to manage the growing pressures stemming from scarcity, excess, and contamination. In this paper, we propose a fresh approach to navigating water-related risks, with a view toward delivering more sustainable outcomes for communities, companies, and investors.
Executive Summary
Managing water-related risks is becoming a key consideration for companies, as investors pay greater attention to their potential financial impacts. Failure to account for these risks can undermine financial performance, while companies that proactively address them may gain a strong competitive advantage.
To aid investors in navigating these material water risks, many have relied predominantly on disclosure mechanisms. While helpful, disclosure by itself falls short in driving meaningful change.
Instead, we propose a stakeholder-centric approach — one that involves engaging directly with local stakeholders to account for their perspectives and enable companies to manage water risks more effectively.
Through an analysis of firms in the metals and mining, beverage, and semiconductor manufacturing sectors — all exposed to significant water-related vulnerabilities — we have developed a flexible, five-step framework for assessing and strengthening their stakeholder engagement practices.
We believe this approach can enable investors to foster more sustainable, resilient, and value-generating outcomes for both companies and the communities that surround them.
Water security poses a significant challenge across the globe — requiring a way to manage the growing pressures stemming from scarcity, excess, and contamination. In this paper, we propose a fresh approach to navigating water-related risks, with a view toward delivering more sustainable outcomes for communities, companies, and investors.
Executive Summary
Managing water-related risks is becoming a key consideration for companies, as investors pay greater attention to their potential financial impacts. Failure to account for these risks can undermine financial performance, while companies that proactively address them may gain a strong competitive advantage.
To aid investors in navigating these material water risks, many have relied predominantly on disclosure mechanisms. While helpful, disclosure by itself falls short in driving meaningful change.
Instead, we propose a stakeholder-centric approach — one that involves engaging directly with local stakeholders to account for their perspectives and enable companies to manage water risks more effectively.
Through an analysis of firms in the metals and mining, beverage, and semiconductor manufacturing sectors — all exposed to significant water-related vulnerabilities — we have developed a flexible, five-step framework for assessing and strengthening their stakeholder engagement practices.
We believe this approach can enable investors to foster more sustainable, resilient, and value-generating outcomes for both companies and the communities that surround them.