CalPERS, CalSTRS, the New York City Office of the Comptroller, Federated Hermes, Franklin Templeton and Aviva Investors are among the institutions involved in an initiative focused on moving companies to respond to the global water crisis.
Coordinated by Ceres, the Valuing Water Finance Initiative aims to engage “72 of the world’s biggest corporate water users and polluters” to drive corporate action on water-related financial risks and raise awareness within the capital markets of the widespread negative impacts of corporate practices on water supplies.
Unilever, Nestlé, Danone, Adidas, Coca-Cola, JBS, Microsoft, Apple, Amazon, Alphabet, McDonald’s and JBS are among the firms set to be engaged by the 64 investor signatories.
Tuesday’s news comes as heatwaves have been affecting European nations, causing evacuations, heat-related deaths, and droughts.
John Anzani, executive at the Local Authority Pension Fund Forum, a signatory to the Valuing Water Finance Initiative, said: “Institutional investors cannot meet their fiduciary obligations without factoring water into their engagement strategies. It’s never been more imperative that companies achieve sustainable water management through intentional use, pollution reduction, governance and other strategies.”
The initiative has set out six expectations for investors to deploy in their dialogues, including: companies do not negatively impact water availability or quality in water-scarce areas across their value chain; they do not contribute to the conversion of critical natural ecosystems and actively work to restore degraded habitats that their businesses depend upon; and they ensure that all public policy engagement and lobbying activities are aligned with sustainable water resource management outcomes.
When Responsible Investor asked whether the initiative would name the investors who will lead engagements with specific companies, a representative from Ceres said: “We’ll have more to share following the launch as we’re in the process of developing investor engagement teams.”
And on whether any milestones or hard deadlines would be imposed on engaged companies, the representative said: “Some investors may put forward suggested milestones or timelines during engagements. However, this has yet to be determined and will likely vary depending on where a company is on its water management journey.”
The program builds on Ceres’s work over more than a decade to build the scientific and financial cases for investor water action and draw attention to the water crisis’s risks.
A spokesperson for JBS told RI: “Increased water stewardship is definitely one of the priorities of our company and we are looking forward to engage with the relevant forums aiming at developing collaborative partnerships to enhance our performance in that regard. JBS is focused on the continued progress of our nature-positive metrics, and this includes our water management, among other initiatives.”
At the time of publication, none of the other named companies had responded to RI’s request for comment.
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