ESG Research of the Year, Europe: DWS, Ceres and BlueRisk

A joint report by Ceres, DWS and data experts BlueRisk examined the amount of financial value at risk from pollution and water availability, which is often overlooked, with a particular focus on the meat industry and wrapped clothes.

Using data provided by the Global Institute for Water Security at the University of Saskatchewan, S&P Global Sustainable, as well as data from other sources, The Financial implications of tackling water-related externalities in the clothing and meat sectors argues that the contributions of these sectors to water stress are often not the focus of investors and governments.

He finds that the cost of addressing harmful impacts on water could range from nearly $60 million to $1.8 billion per year for some large publicly traded meat and packaged apparel companies.

“Water is an overlooked priority for investors, businesses and governments, so we are grateful to Environmental financing for acknowledging Ceres, BlueRisk and DWS research report on the financial and societal materiality of water,” said Murray Birt, Senior ESG Strategist at DWS Group. “This report will help investors become more active in encouraging businesses and governments to step up their water sustainability efforts.”

The report concludes that, if businesses were required, through future regulations, internal policies, or investor or societal expectations, to clean up and reduce their water use, the additional spending could have an impact. negative 21% to 47% on the profits of some clothing companies. While the impact on meat companies could see their net profits hit between 5% and 165%.

“The apparel and meat sectors are among the largest industrial contributors to water scarcity and quality issues – and they are also among those with the most related financial risk,” said Kirsten James. , Senior Program Manager for Water at Ceres, and Contributing Author of the report. “Companies in all sectors have an obligation to understand this financial risk and act to eliminate their negative impacts on water, in order to protect shareholder value at risk.”

Mary I. Bruner