A coalition of investors is asking North American fossil fuel producers to up their disclosure on water risks.

The Shareholder Association for Research and Education is teaming up with the U.S.-based Interfaith Center on Corporate Responsibility to send a letter to 30 companies requesting they participate in a water questionnaire from the Carbon Disclosure Project, a British organization that encourages companies to disclose environmental data and has the backing of 639 investors worldwide.

In the letter, the coalition of investors, which represents US$6 trillion under management, refered to the United Nation’s prediction of a 40 per cent shortfall in the global water supply by 2030. This means water-intensive processes like hydraulic fraction and oil-sands mining face an operational risk. As water becomes more scarce globally, the fossil fuel sector faces increasing physical, regulatory and financial risks, the group noted.

Read: Could climate change turn Canada’s Arctic into an emerging market?

“As water resources become increasingly constrained due to overconsumption, pollution and climate change, companies that treat water risk as a current strategic challenge and manage this resource sustainably will be better positioned in the future,” said Laura Gosset, senior analyst at SHARE, in a press release. “Conversely, companies that ignore these challenges put themselves, their shareholders and, importantly, the planet and its people at risk.”

The investors are recommending the CDP’s survey as a solid benchmark because it investigates companies’ quality of governance around water issues, as well as transparency, measuring and monitoring practices and supply chain management.

Canadian companies like AltaGas Ltd. and Imperial Oil Ltd. already complete the questionnaire annually. However, they were among the 30 companies that received the letter because of issues with their disclosure on wastewater management and water use.

Read: What a storm like Harvey means for energy investors

Copyright © 2018 Transcontinental Media G.P. Originally published on benefitscanada.com

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