From cereal maker General Mills, which relies on local farmers around the world to supply grains and nuts for its products, to tech firms like Microsoft and Amazon that need dependable supplies of freshwater to cool data centers, the list of companies vulnerable to water-related disruptions is growing.
By one estimate, some $15.5 billion worth of corporate assets have been left stranded or at risk by things like community opposition or regulatory changes triggered by water stress. Supply chain and logistical problems caused by water woes make matters worse.
The food, energy, and apparel industries are particularly vulnerable, but no company is immune. About two-thirds of big corporations inadequately manage their water risks, according to proxy advisor ISS, while 69% of listed companies reporting to the Carbon Disclosure Project (CDP) said they are exposed to water risks with a potential value of $225 billion.
With climate change, the numbers are expected to grow. Big investors are taking note.