Climate change: Water risks highest in Asia, says Moody's report

 The Moody's report said risks are more pronounced for water-intensive sectors like mining, agriculture, and power

Water management risks tied to the existing supply and quality issues, as well as risks amplified by climate change, pose credit challenges across multiple sectors in Asia, particularly in parts of South and Southeast Asia where water scarcity or mismanagement is already prevalent, said a report released on Wednesday.

According to the report by Moody’s Investors Service, risk factors include the availability and cleanliness of the water, the adequacy of water transport and treatment infrastructure, the impact of economic activity on supply and pollution, and the effect of regulations.

Water management and the environmental impact of economic activity are some of the parameters on which ESG (Environmental, Social, and Governance) ratings are done for companies and funding which could be in the form of equity or debt through various instruments.

In a separate development, Fitch Ratings announced a new initiative — Sustainable Fitch — that brings out existing ESG capabilities together in one place.

Fitch said it would add over the coming months the first global ESG Rating solution for all asset classes at an entity and instrument level. “It is designed and built on fundamentals entirely and exclusively to help the ESG focused financial community makes better-informed decisions,” it said.