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Credit: Ben ClarkInitiative to provide unprecedented level of water risk information for business and government
Recent water-related events – from extreme droughts across the southwestern United States to flooding in central China – provide vivid examples of the potential impacts of water on people, businesses, and local infrastructure. To assess and respond to increasing water risk globally, the World Resources Institute (WRI) is launching the Aqueduct Alliance, a consortium of leading water experts from the private and public sectors, NGOs, and academia. Founded by WRI, Goldman Sachs and General Electric, the alliance has added Bloomberg, The Dow Chemical Company, Talisman Energy, and United Technologies. The Coca-Cola Company is also engaged and will be providing an extensive global database of once proprietary water risk information to support Aqueduct’s work.
In a survey of 150 large corporations conducted by CDP Water Disclosure, nearly 40 percent of responding companies indicated that they had already experienced disruptions in operations, increases in expenses, and other detrimental impacts related to water. Against a backdrop of rapid population growth and climate change, government entities charged with managing water resources are also increasingly concerned with water-related disruptions and seeking viable approaches for mitigating risks.
“Businesses and governments are increasingly concerned with water-related risks, which can negatively impact profitability and continued economic growth,” said Kirsty Jenkinson, Director of WRI’s Markets and Enterprise Program. “Aqueduct will provide accurate, high quality information together with a platform for businesses and governments to address water risks beyond physical water scarcity, including regulatory and socioeconomic risks.”
At the heart of Aqueduct is a global database of water risk information that will enable companies, investors, governments, and others to create water risk maps with an unprecedented level of detail and resolution. The maps generated by Aqueduct combine advanced hydrological data with geographically-specific indicators that capture the social, economic, and governance factors that affect companies and economies. Robust risk assessment is the foundation for developing strategic water resource management plans at the business, watershed, and municipal levels. This publicly-available and transparent database will inform private sector efforts to reduce its water footprint in high risk areas, and create an impetus for public sector leaders to enter into dialogues with a range of stakeholders that will ultimately lead to more equitable, efficient, and sustainable water resources management in water-stressed basins.
“Water risk is becoming an increasingly critical global issue, but one that is inherently local and not yet fully considered in business and investment decisions,” said Kyung-Ah Park, Managing Director for the Goldman Sachs Environmental Markets Group, one of the founding partners in the Aqueduct project. “Aqueduct will work to facilitate better management of water risk and help identify market opportunities that drive more sustainable economic development.”
“Water risk is emerging as one of the greatest threats to long term economic and environmental sustainability,” said Jeff Fulgham, Chief Sustainability Officer for GE Power & Water, one of the other founding partners in the Aqueduct project. “Our customers around the world are addressing physical, operational, regulatory, social & reputational and financial risks all relative to water. Aqueduct will enable us to help our customers better assess and proactively address these risks.”
WRI has already developed a working prototype of the database and risk mapping tool, covering the Yellow River Basin in northern China. WRI will soon be launching an updated interactive web platform that includes global and basin-specific maps and information on water related risks. The ultimate goal of the project is to provide a comprehensive database of water risk information that can support improved public and private sector decision-making in increasingly water-stressed locations throughout the world.
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Read the Financial Times story on the launch, here