by Barry Wind and Jeremy A. Pearce
Here in the mid-Atlantic, we enjoy, and maybe take for granted, our access to a healthy supply of clean water for drinking, bathing, watering our lawns. But around the world, 780 million people lack access to safe clean water. Two and half billion people lack access to adequate sanitation. Every 20 seconds a child dies from a water-related disease, according to Food and Water Watch. The water shortage can create environmental damage as well as causing wetlands to disappear, rivers to run dry and crops to wither on the vine. This in turn brings on regional and international conflict as states and nations fight over river and groundwater rights. And the problem is going to get worse.
There are many underlying causes for this coming crisis. With climate change and changing weather patterns, water resources are being adversely affected through drought, flooding and disappearing glaciers and snow packs. Water pollution from agricultural runoff and human and industrial waste remains an issue in many parts of the world. The ever- increasing demand for water by industry, agriculture and a growing population strains our ability to filter and provide an adequate supply of clean, potable water. And the problem is going to get worse. Unless…
We start making a difference. Just as there are many causes for water scarcity, there are many actions we can all start taking to slow down and possibly reverse this global challenge. While impacting climate change and reducing pollution are often seen as a “government” problem, we, as responsible citizens, can take the steps we’ve heard many times before to reduce our personal carbon footprint.
We can drive less and walk and bike more. We can buy less, reuse and recycle more. Most importantly, we can be much more aware of how and when we use water, cutting back where we can on unnecessary water use.
We can also make a significant impact on industrial and agricultural water use by where we choose to buy our goods and services and where we choose to make our investments. For socially responsible investment investors, the focus is on how you can have a positive impact on water scarcity through your investment choices, though many of the recommendations may also be applicable to how and where you make your purchases.
When you buy a company’s stock (or buy its products), you help support that company’s ability to finance operations, invest in new growth and ultimately make a profit. By targeting companies with responsible water use policies and foregoing corporations that are not responsible water users, you are rewarding those companies that are conscientious water stewards.
More directly, you can choose to invest in companies that have products and services that contribute to sustainable water use solutions, thereby increasing their capability to grow and expand their impact. You can also participate in higher impact, community level investment programs targeted to solve specific local water needs. As a responsible shareholder, you can also participate in shareholder dialogues and actions with company management to encourage more sustainable water practices.
Water scarcity is a growing concern that is likely to get worse unless we all take action. Most immediately, individuals, families and businesses can reduce their carbon footprint and limit unnecessary water usage. As consumers and investors, we can also be much more selective in who we do business with and which companies we invest in, sending a message that water scarcity is an issue that needs to be addressed by all responsible businesses.
Barry Wind and Jeremy A. Pearce are financial advisors in the Washington, D.C. area, specializing in socially responsible investing with SharePower Responsible Investing, Inc. Comments and questions can be sent to firstname.lastname@example.org and email@example.com.
Investing involves risk including loss of principal. Different types of investments carry varying degrees of risk and clients and prospective clients should be prepared to bear investment and original principal loss. Investing, including socially responsible investing, does not guarantee any amount of success. These are the opinions of the author and not necessarily those of Cambridge Investment Research, are for informational purposes only, and should not be construed or acted upon as individualized investment advice.
Securities offered through Cambridge Investment Research, Inc. member FINRA/SIPC. Advisory services through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and SharePower Responsible Investing, Inc. are not affiliated.