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The water crisis

The Climate Crisis is a Water Crisis

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A quarter of the world’s population already live in countries facing extreme water stress. By 2030, worldwide demand for water will be a staggering 40% higher than it is today, on current trends.


Much of the risk comes from industrial usage, through manufacturing activities or the transportation of products. It’s estimated that nearly two-thirds of water consumption goes into corporate supply chains.


Companies and investors must aim for water neutrality in order to tackle this crisis. Their water consumption should not exceed nature’s ability to replenish water sources. Pollution levels should be no more than is acceptable for human health and environmental ecosystems.

Investors must complete water risk assessments and actively engage with companies to ensure they are pursuing sustainable principles throughout their supply chains. It’s also vital that investors work with policy makers and NGOs to help change the dial.

We are all responsible for making this happen at speed. Cardano has 30 years’ experience of sustainability and is committed to achieving water neutrality in our own portfolios by 2030, to support our clients in playing their part.

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Why water is a material risk for investors

The rapid depletion of the world’s water supplies represents a major risk to investors and portfolio companies.


Companies need water for their production processes. Severe shortages could lead to production interruptions, as well as conflict with competitors and the local population.


Water treatment costs could also potentially rise, due to an increase in pollution levels.



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Creating a water-neutral investment portfolio

Cardano is determined to achieve water neutrality in our portfolios by the end of the decade. Water neutrality is especially critical in high-risk countries where water is scare and in biodiversity rich countries.


We assess a company’s water management strategy by considering both its level of exposure and its management of the risk, including designing policies and setting targets to reduce water use.

Our screening process involves proprietary methodology and screens over 14,000 companies every quarter. The companies are judged on their ability to transition to a more sustainable world – and whether or not they are making sufficient progress to get there.

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The vital role of stewardship

Cardano views stewardship as the active management of capital to encourage long-term value creation. It’s not just about the long-term financial value of our portfolios, but also the lasting value and benefits for the environment, society and other stakeholders.


We use a range of different tools, including company engagement, voting and, where necessary, filing shareholder resolutions. We also use our voice in public policy participation to encourage improvements within companies and the broader economic system.