• In this report, we examine which trends may emerge to catalyze private water investing and how investors gain exposure to opportunities for investing in solutions.
  • Water scarcity is an increasing area of concern for society, as crises like Cape Town highlight the fragility of certain regional water systems. Investors continue to be interested in how they can support a solution for increased water availability and quality.
  • However, investors should proceed with caution. A bottom-up examination of water financing trends concludes that while private investing activity has grown since the early 2000s, attractive opportunities remain limited and recent interest has been concentrated in the intersection of water and technology.
  • In the long term, a confluence of behavioral and demographic shifts, regulatory developments, and technology innovation is positioned to expand market opportunities.
  • We provide an overview of potential water investment strategies by asset class. We also suggest engagement questions investors can use to understand how their asset managers are considering investing in water and to gain an understanding of the greater social and environmental impacts of water investing.

Areas with higher exposure to water-related risksSource: Aqueduct Water Risk Atlas

Download the full report here.

Sebastian Vanderzeil is Director, Global Thematic Research Analyst with Cornerstone Capital Group. He holds an MBA from New York University’s Stern School of Business. Previously, Sebastian was an economic consultant with global technical services group AECOM, where he advised on the development and finance of major infrastructure across Asia and Australia. Sebastian also worked with the Queensland State Government on water and climate issues prior to establishing Australia’s first government-owned carbon broker, Ecofund Queensland.

Craig Metrick, CAIA is Managing Director, Institutional Consulting and Research at Cornerstone Capital Group, where he oversees the firm’s manager review process and provides investment advisory services for our foundation, endowment and family office clients. Previously, Craig was Principal and US Head of Responsible Investment at Mercer; for nearly 15 years, he has consulted on implementing responsible investment principles and mandates. Craig serves as the Chair of the Board of the US Forum for Sustainable and Responsible Investment (US SIF).

Jennifer Leonard, CFA is Director, Asset Manager Due Diligence at Cornerstone Capital Group. In a career spanning microfinance, institutional financial services and impact investing, Jennifer has developed a unique skill-set in working to deploy capital for social and financial returns. Previously, she was vice president of impact investing at The CAPROCK Group, where she co-led the firm’s impact practice and helped clients build customized, impact-mandated portfolios. From 2009-13, she was a Latin America equity research analyst at Morgan Stanley.

Emma Currier is a Research Associate at Cornerstone Capital Group. Emma graduated with a Bachelors of Arts degree in Economics from Brown University in May 2016. While at school, she worked with the Socially Responsible Investing Fund and as a teaching assistant for the Public Health and Economics departments. She spent her sophomore summer researching differences between American and Indian educational styles in Arunachal Pradesh, India, and completed a summer investment bank analyst position with Citi in the Media & Telecom group in 2015.