Water is essential to the production and delivery of nearly all goods and services. Overconsumption and pollution are making clean water an increasingly scarce resource, putting business and economic growth at risk. At the same time, in many regions of the world, the price of water is undervalued and underpriced even when it is scarce and, as a consequence, businesses often overlook its actual value to their operations. This makes it very difficult for companies to make a business case for investing in water efficiency improvements, even as the gap between demand and available supply continues to widen.
Natural capital valuation provides a way for businesses to place a value on these water-related risks. By assigning a monetary estimate of risk, companies can make the business case for investments in water stewardship and take action to realize their growth ambitions, especially in water-stressed regions.