WRI, GE, Goldman Sachs launch initiative to measure water risks, opportunities
TREVOSE, PA, Dec. 7, 2009 -- The World Resources Institute (WRI), in partnership with General Electric and Goldman Sachs, has launched an initiative to measure water-related risks facing companies and their investors...
• Water Index will offer most comprehensive measure of corporate risks and opportunities
TREVOSE, PA, Dec. 7, 2009 -- The World Resources Institute (WRI), in partnership with General Electric and Goldman Sachs, has launched an initiative to measure water-related risks facing companies and their investors. The initiative will develop a Water Index as a standardized approach to identify and mitigate water-related corporate risk.
The Index will offer one of the most expansive measures of water risks currently available. It will aggregate nearly 20 weighted factors capturing water availability, regulations, water quality and reputational issues.
As water resource constraints affect nearly all industries, the Water Index will be widely applicable. The Index will allow companies and investors to transparently and adequately capture the various components of water-related risk and will enable business leaders to make more well-informed investment decisions.
The Water Index will draw on publicly available data regarding physical scarcity and water quality and overlay important factors including the regulatory regime and social and reputational issues that have not previously been incorporated into water risk measurement. Ultimately, this mapping tool will allow users to combine and compare different components of the water risk assessment.
"In many regions around the world, water scarcity from climate change and pollution is starting to impact a company's performance, yet few analysts account for water-related risks," says Jonathan Lash, president of WRI. "WRI hopes that investors will begin 'pricing in' these under-appreciated risks, driving investments to support more hydrologically efficient designs and technologies."
From the perspective of General Electric and Goldman Sachs, the Water Index will allow each firm to better advise customers and clients on water-related risks and opportunities.
"From a technology perspective, solutions to enable water reuse and mitigate risk already exist," said Heiner Markhoff, president and CEO -- water and process technologies for GE Power & Water. "Advanced solutions, such as membrane technology and water-efficient cooling technologies, are available to manage the risks once these are identified and measured, which is what the Water Index aims to do. We are thrilled to work with WRI and Goldman Sachs on this project."
"Many environmental factors, including water, pose both challenges and opportunities for investors and businesses," says Tracy Wolstencroft, global head of environmental markets for Goldman Sachs. "The Water Index will provide valuable insights that can inform investment decisions and will help identify new opportunities across sectors and geographies."
About the World Resources Institute
The World Resources Institute (www.wri.org) is an environmental think tank that goes beyond research to find practical ways to protect the earth and improve people's lives.
About Goldman Sachs
The Goldman Sachs Group Inc. is a leading global financial services firm providing investment banking, securities and investment management services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals. Founded in 1869, the firm is headquartered in New York and maintains offices in London, Frankfurt, Tokyo, Hong Kong and other major financial centers around the world.
The Environmental Markets Group is responsible for ensuring that Goldman Sachs' people, capital, and ideas are leveraged effectively to develop market-based solutions to environmental issues. The group partners with corporations, non-government organizations, and academic institutions to identify and provide guidance on relevant environmental topics. The Environmental Markets Group disseminates research and project results through a combination of publications, conferences and targeted outreach to engage and educate clients, investors and policymakers.
GE is a diversified global infrastructure, finance and media company that's built to meet essential world needs. From energy, water, transportation and health to access to money and information, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide.
GE serves the energy sector by developing and deploying technology that helps make efficient use of natural resources. With 60,000 global employees and 2008 revenues of $38.6 billion, GE Energy www.ge.com/energy is one of the world's leading suppliers of power generation and energy delivery technologies. The businesses that comprise GE Energy -- GE Power & Water, GE Energy Services and GE Oil & Gas -- work together to provide integrated product and service solutions in all areas of the energy industry including coal, oil, natural gas and nuclear energy; renewable resources such as water, wind, solar and biogas; and other alternative fuels. For more information, visit the company's Web site at www.ge.com. GE is imagination at work.