The report, A Wave of Change, by CDP, a non-profit that runs the world’s environmental disclosure platform, finds that the companies disclosing through CDP’s water security questionnaire in 2020 risk losing up to a combined US$301 billion in business value if they fail to address them. THE CDP estimate the total cost of addressing these risks at US$55 billion – less than one fifth of the amount they stand to lose if they don’t take action to tackle them.

Cate Lamb, Global Director of Water Security at CDP, commented:

“Water shortages are affecting more than 3 billion people worldwide, with the amount of freshwater available per person having plunged by a fifth over two decades. The water crisis must be approached with the same urgency and innovation as the COVID-19 crisis – and the business case for action is clearer than ever.

“Some of the world’s thirstiest companies are already innovating by reusing water in creative ways, developing water-smart products, and remodelling their strategies to adapt to the water crisis. We can turn this situation around, but we need much more transformative action.”

“As investors pay closer attention to companies’ management of water risks, CDP is calling for all companies to develop ambitious targets to reduce water withdrawals and eliminate water pollution, including net-zero water targets. Companies must take bold action now to transform their business models.”

In the last year, companies reporting to the CDP have made progress on water use, with nearly two thirds of companies reducing or maintaining water withdrawals, thanks to the implementation of measures to reuse and save water.

However, the report says that in addition to taking action on water availability, the companies also need to take action on water quality. The analysis finds overall business action on water pollution is severely lacking, with just 4.4% of companies making progress against pollution reduction targets.

Read more and download the report here.