21 October 2011, 8:30 – 12:30 | Washington, D.C.
UNEP FI, the Alliance for Global Water Adaptation (AGWA), the World Bank and Conservation International will be hosting a half-day training workshop on water and finance directly after the UNEP FI Global Roundtable. The workshop aims to raise awareness and build capacity for banks to identify and manage water risks related to lending in water scarce areas and/or water-intensive sectors. Specifically, the workshop will deal with:
- The materiality of water for banks from a lending perspective;
- Tools to identify and manage water risks;
- Practical case studies to better understand how to deal with water risks in your own institution.
Over the past 20 years there has been a notable shift by bankers and investors to not only assess the pure financial aspects of loans and investments, but to increasingly account for environmental and social issues that are financially material as well. Looking at three defining environmental issues in the 21st century – global climate change, biodiversity loss, and shifting water scarcity, variability, and availability – banks and investors need to be aware to addressing these different environmental issues requires specialised knowledge on each of these in terms of risks, available tools and impact. A number of drivers have started to emerge, such as increased pressure and activism by non-governmental organizations, increased regulatory and liability regimes by governments willing to protect their ecosystem services, and increased scrutiny of supply chains for ecosystem-dependent sectors such as energy, agriculture and mining, which tend to interact and amplify each other leading to a greater relevance of water issues for the private sector. In many cases, water is embedded within other investments in ways that may be hidden from direct view, such as through supply chain management. And while scientific projections of the future describe the uncertainties around water availability and variability, these uncertainties are difficult to describe as meaningful risks for investors and lenders. Financial institutions that are unaware of these issues may face unexpected risks in terms of reputation, credit risk, or reduced shareholder value. In that sense water can be regarded as the next challenge financial institutions have to deal with.
Banking and investment:
- Credit analysts
- Risk managers
- Portfolio managers
- ESG experts
Format and content of the workshop
The workshop will be a half day event that aims to develop a deeper understanding of the impacts that water and climate hold for financial decision-making. The workshop should not only deepen the understanding of participants on water risk in the context of climate uncertainty, but also provide financiers with the requisite tools to approach water and sustainability issues in an age of climate change. It will be interactive with questions asked by the moderator and speakers to the audience. The workshop will conclude with two to three case studies that participants discuss in small group and provide feedback plenary.
water [at] unepfi.org