WEBVTT

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[LIGHT-HEARTED MUSIC]

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One in four people
globally live in regions

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at high risk of water scarcity.

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This creates a financial
risk that investors today

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are overlooking.

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The causes of water
stress are varied.

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Population growth and
urbanization increase demand

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for water and strain resources.

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At the same time, climate
change shifts the distribution

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of water supply by disrupting
precipitation patterns.

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One in two people will live
in water-stressed locations

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by 2030.

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The risks cut across sectors.

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Water-intensive industries like
agriculture, electric, power,

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and food and beverage
may be most at risk.

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Think of any company that
has production facilities

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in water-stressed regions.

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What will happen?

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They will face higher
operating costs.

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They will face higher
insurance premium.

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They will likely
need to spend more

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on water efficiency measures,
on recycling plants,

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on conservation.

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They will have to
do this in order

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to meet regulatory requirements.

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These requirements, over time,
are likely to get tighter.

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Think of the real estate market.

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Here you will have
tenant preferences

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that will shift towards
greener buildings.

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The credit worthiness of
some countries, states,

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and municipalities
facing water shortages

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could also come
under threat as they

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face additional costs to fortify
their water infrastructure.

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This comes on top of other
growing physical climate

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risks, such as exposures to
flooding and other extreme

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weather events.

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Now here's the bottom line--

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water stress is just one of many
sustainability-related risks

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that we believe are becoming
increasingly salient over time.

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