Publication / 01 Mar 2016

Resource Efficiency: A Case Study in Carbon and Water Use

This research shows that more carbon and resource efficient companies may outperform less efficient ones.

In recent years, there has been increasing awareness around the issues related to climate change, and substantial amounts of money have been committed to tackle it. This includes undertakings to decarbonize institutional equity investments.

Increasing the efficiency of the fossil fuels we already consume is undoubtedly an important focus. However, can we extend this approach to take into account how well we consume other resources such as water so that we can look at resource efficiency at large?

This research looks at how the scarcity of natural resources means that there may be merit in considering the efficiency of a number of resources at the same time, especially given that the demand for them is correlated. Despite limited data history, our preliminary findings show that more carbon and resource efficient companies may outperform the less efficient ones. Focusing on efficiency could help businesses mitigate risks such as regulation, resource depletion, and reputational risks

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