We live in a water world. Water covers about 71,5% of our planet. Still, we can only drink around 2,5% of it. Further, more than 1,2 billion people globally currently lack access to clean drinking water. This water gap is only set to increase. With the estimated population growth, growth in middle class and climate change impacting earth, demand for water will outstrip water supply by 40% in 2030. This is in other words a huge contradiction and a problem – we are surrounded by water, but water is a scarce resource for a lot of people globally.
Water is also essential to us humans and life. The majority of the human body consists of water (more than 60%). We can survive around three weeks without food, but only three days without water. The lack of water has already lead to several conflicts globally, but this is only set to increase, leading to “Water Wars” – when countries and regions fight over access to water and their ability to survive. We have fought over access to oil (though the lack of access to oil is not life threatening). Just imagine then what we will do to each other, when we lack access to water. Water crisis will also have a hige economical impact. According to World Economic Forum, water crisis accounts as some of the top economical crisis humanity face the next ten years.
Some of our current water challenges are lack of and diminishing access to water, unsustainable usage of ground water (we currently extract more water than is replenished) and polluting our existing water sources, making the water undrinkable. People are also increasingly competing over access to water with industry and companies utilizing water in their production.
As you understand, water is a tremendous global challenge. Lack of access to clean water also affects a lot of other environmental and social areas, such as health and education. The scale of the water importance and problem is illustrated by the Sustainable Development Goal number 6 (“Access to clean water and sanitation”) being the one goal that impacts on all the other 16 SDG goals.
A huge global problem and challenge…but therefore also a tremendous opportunity! For most problems there are solutions.
Today, a lot of companies work to provide products and services that solve some of our global water challenges. This includes desalination (making fresh water out of salty water), cleansing polluted water, water efficiency solutions bu utilizing technology and more. Agriculture stands for 70% of global water usage, and the industry uses 20%. In other words, there are huge efficiency gains to be made. For example, precision farming by utilizing technology to just use the water you need, as well as enabling water efficiency in production operations, which leads to cost reductions for the companies.
These also make up great investment opportunities. According to RobecoSAM, one of the leading asset managers globally, the global water market is set to grown from 500 USD billion today, to 1 trillion USD by 2020. Hence, a big growth market for investors to tap into.
Our biggest sustainability problems are also some of our biggest company and investment opportunities. Those companies that deliver solutions and products to some of our biggest sustainability challenges globally, will be the winners of tomorrow.
If you want to learn more, check out RobecoSAMs explanation of water as a big challenge and opportunity: