Greenhouse gas emissions and global warming dominate public discussion. But one of the sectors most affected by this phenomenon is somewhat lower on the discussion and market radar, despite its major impact: water.

The water crisis is advancing by leaps and bounds. The World Health Organization (WHO) estimates that within four years half of the world's population will be living in water-stressed areas. There is a segment of the capital market that seeks to contribute its drop of water to meet this challenge by giving visibility to this sector with funds and ETFs focused on companies dedicated to the supply, treatment, technology and management of water resources or by creating indexes that incorporate the water risk of the largest capitalization stocks, such as the TSC Water Security Index for the USA and Europe. (https://www.thomasschumanncapital.com/solutions).

As has been the case for most ESG (sustainability-related) funds and financial assets, the return on investments in water-related assets, such as those of the S&P Global Water Index, which includes 50 stocks from around the world, or the Calvert Global Water, a fund that includes more than a hundred companies, have been in line or slightly above the market average, with an annual return of 12.33% and 11.9% annual average, respectively, for the last five years.

Source: S&D Dow Jones Indices