New Water Risk Filter Scenarios will help companies and investors turn risk into resilience
Posted on 06 October 2020
With almost half of global GDP potentially coming from high water risk areas by 2050, the Water Risk Filter Scenarios will help companies and investors turn risk into resilience.With climate change worsening the world’s already severe water crises, new forward-looking scenarios in WWF’s Water Risk Filter estimate that 46% of global GDP could come from areas facing high water risk by 2050.
Live now in the WWF Water Risk Filter – the leading online tool for assessing, valuing and responding to water risk – the scenarios (Optimistic, Current Trend and Pessimistic) for 2030 and 2050 will help companies better understand future water risks and drive more effective corporate action on climate and water resilience.
“Companies are finally waking up to growing water risks and the need to take urgent action to reduce their risks and tackle shared water challenges,” said Ariane Laporte-Bisquit, WWF Water Risk Filter Lead. “By harnessing the new scenarios in the Water Risk Filter tool, companies and investors can better assess, respond and plan for climate and water resilience.”
Based on climate and socio-economic changes, the scenarios are aligned with the Task Force on Climate-related Financial Disclosure (TCFD) recommendations.
Given the high uncertainty in the context of climate change, TCFD recommends companies and financial institutions apply scenario analysis for assessing climate-related risks and opportunities to determine business resilience. As the impacts of climate change will primarily be felt through water, it is critical for scenario analysis to incorporate water in a comprehensive manner.
“Climate-related risks and opportunities are undeniably intertwined with those associated with water. Any assessments of future water-related events should therefore consider the climate, but this is only one piece of the puzzle. Other socio-economic drivers impact the supply and demand of water, such as regulatory, market and demographic changes. The new WWF Water Risk Filter tool supports the integration of water into TCFD-aligned scenario analysis and will strengthen the disclosure and assessment of companies’ resilience to future scenarios,” said Francesca Recanati, Environmental Specialist (Technical Manager), Climate Disclosure Standards Board (CDSB).
Already trusted by thousands of users, the Water Risk Filter tool now enables companies and investors to perform forward-looking scenario analysis to evaluate future climate-water risk exposure and inform long-term resilience planning and strategy – and some major multinational companies are already testing the new scenarios.
“Recognizing the TCFD recommendations and importance of assessing and preparing for potential future water risks in a changing climate, Carlsberg was the first company to test and use the new WWF Water Risk Filter scenarios to understand how water risks across our breweries may evolve in 2030 and 2050 under different scenarios,” said Simon Boas Hoffmeyer, Senior Director Sustainability at Carlsberg Group, which has assessed the basin and operational water risks across its breweries using the WWF Water Risk Filter since 2017.
“Water resources are under growing pressure from climate change, increasing the risks to food production in many areas. EDEKA is using the new WWF Water Risk Filter scenarios to better understand future water risks to key agricultural commodities, which will help inform our long-term plans and strategy for climate and water resilience,” said Rolf Lange, Head of Corporate Communications at EDEKA Headquarters. Since 2012 freshwater is a key topic in the partnership for sustainability between WWF and the German food retailer EDEKA.
The WWF Water Risk Filter Brief released today provides a detailed overview of the WWF Water Risk Filter scenarios as well as guidance on how scenario analysis can help companies and investors to understand future water risks and build resilience in an uncertain future.
“Understanding current water risks using the Water Risk Filter tool is a critical first step for the successful implementation of the Alliance for Water Stewardship (AWS) Standard. With climate change exacerbating water risks, the new Water Risk Filter scenarios will enable companies to better understand future climate-water risks and develop water stewardship strategies that are future-fit,” said Adrian Sym, CEO, Alliance for Water Stewardship.
“As a first step in our new collaboration with WWF, we are analyzing current water risks across our global operations using the Water Risk Filter tool. We look forward to using the tool’s new scenarios to evaluate future water risks, which will inform our resilience planning in the face of climate change,” said Fredrik Hellman, Climate Resilience Lead, AstraZeneca