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Water Risk Index

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Water Risk Index

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Amazon
5888268 km2
Countries
Brazil; Peru; Suriname; France; Colombia; Guyana; Bolivia; Venezuela; Ecuador
Cities
Santa Cruz; Manaus; La Paz
Location City, Country & Regions Interests
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Quick Info

Partners: Equarius Risk Analytics LLC
LImeyard
Countries: United States of America
Regions: California
Project SDGs:
Includes Sustainable Development Goals from the project and its locations.
Stakeholder Participation (SDG 6.b)
Integrated Water Resource Management (SDG 6.5)
Water Use Efficiency (SDG 6.4)
International Cooperation and Capacity Building (SDG 6.a)
Project Tags:
Includes tags from the project and its locations.
Water-Related Vulnerability Assessments
Services Needed: Communications & outreach
Financial support
Research & analysis
Technical assistance
Desired Partners: Academic Institution
Business
Business Association
City
Government
NGO / Civil Society
UN Entity
Social Enterprise
Investor
Financial Institution
Project Type: Strategy
Language: English
Start & End Dates: Jan. 2017  »  Ongoing
Project Website: www.thomasschumann.com
Project Investment: $2000000.00
Tech Providers: Equarius Risk Analytics LLC, Limeyard Ltd.
Project Source: User
Profile Completion: 96%

Project Overview

The world’s first benchmark index to price financial water risk to equities launched December 11th, 2018 on Bloomberg (Ticker Symbol: LYU5WRUG). LIMEYARD TSC Water Risk Index is designed to inform asset owners and investment managers of the water risk to equities in their financial portfolios through a portfolio theory-based risk model.

The model, waterBeta, prices water risk as an unsystematic volatility metric, relative to industry-specific benchmarks. Rather t...

Read More

The world’s first benchmark index to price financial water risk to equities launched December 11th, 2018 on Bloomberg (Ticker Symbol: LYU5WRUG). LIMEYARD TSC Water Risk Index is designed to inform asset owners and investment managers of the water risk to equities in their financial portfolios through a portfolio theory-based risk model.

The model, waterBeta, prices water risk as an unsystematic volatility metric, relative to industry-specific benchmarks. Rather than forcing asset managers to make their own interpretations of operational reports and resource management scenarios, the index translates the key metrics of water risk into financial measures that can be accurately and effectively incorporated into financial models.
Asset managers require transparency to make decisions.

Project Results

waterBeta is based on share pricing, curated corporate financial accounting, and voluntary disclosures of environmental risk attributes. Where data are unavailable, learning models are used to impute sector-specific values. The Water Risk Index allows the asset manager to make allocation decisions based on probabilistic financial indicators of corporate and portfolio risk. At the individual security level are three critical research steps to obtain a comprehensive pictu...

Read More

waterBeta is based on share pricing, curated corporate financial accounting, and voluntary disclosures of environmental risk attributes. Where data are unavailable, learning models are used to impute sector-specific values. The Water Risk Index allows the asset manager to make allocation decisions based on probabilistic financial indicators of corporate and portfolio risk. At the individual security level are three critical research steps to obtain a comprehensive picture of water risk pricing:

1) Understand corporate water dependency and localized water security

2) Integrate water dependency and security data with financial accounting metrics

3) Correlate temporal water events with short-term Value-at-Risk (VaR) metrics

Water risk pricing of securities reverberates in cost of capital assumptions, corporate growth rates, cost of operations, and debt-to- EBITDA ratios, potentially affecting credit rating. A granular understanding of the probability of decreased valuations due to water- related risks creates an impetus for focused investor engagement strategies towards water sustainability.

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Primary Contact

Thomas Schumann
Manager
Thomas Schumann Capital LLC


Organization Partners


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Suggested Resources

View the full list of 300+ resources at the Water Stewardship Toolbox

Ceres Learn More

UN Global Compact Learn More

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AT&T; EDF; Global Environmental Management Institute (GEMI) Learn More


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