Manulife Investment Management has published a new note for investors discussing its efforts to analyze and work with the material impacts water and water risks have on the investment management landscape.
Entitled, The global water challenge: risks and opportunities that all investors should consider, they say today more than 50 per cent of the world’s cities and 75 per cent of all irrigated agricultural areas experience water shortages on a recurring basis.
Financially material factors
“Manulife Investment Management is committed to helping clients achieve their objectives, build resilient portfolios – including in relation to climate change,” they write. “We believe water-related risks and opportunities can be financially material factors that should be integrated into investment strategies and operational asset management.”
To that end, the company has built an in-house, global water team “to drive competitive insight, operational optimization, strategic investment targeting and reputational management.”
Asset classes exposed to water risk
The paper goes on to examine asset classes exposed to water risk, including agriculture and timberland investments and real estate, and discusses engagement with those companies.
“Investors need improved tools and methods to account for water,” they add. “We believe water-related risks and opportunities can be financially material factors that may drive positive or negative outcomes for investments in the future.”
