Calvert News & Commentary

Calvert Invests in Water – On World Water Day and Every Day

Investors have an important role to play in solving the world’s water crisis.

3/19/2012

This Thursday, March 22 (and every March 22nd) is UN World Water Day. The focus of this year’s celebration is the inextricable link between water and food—and why adequate freshwater supply holds the key to food security. Food and water intersect in all aspects of our lives; from the water used to irrigate crops and sustain livestock to our hearths and homes in the everyday rituals of cooking and cleaning. It’s estimated that about 70% of existing freshwater sources are used to provide food for an ever-growing population.

Did you know it takes 880 gallons of water to produce one gallon of milk?

Calvert lives the principle that universal access to fresh water is a fundamental human right and we are a proud participant in World Water Day. And Calvert is at the forefront of investing sustainably and also in using our voice to change corporate behavior and promote positive public-private water initiatives.

The Skinny on Water

According to the World Water Organization, water consumption is doubling every 20 years, more than twice the rate of population growth. The United Nations predicts that by 2050, two-thirds of the world will be “water stressed,” with close to two billion people living in countries facing water scarcity. 1 Booz Allen Hamilton estimates that approximately $22 trillion needs to be invested in water infrastructure alone over the next two decades just to meet the demand for clean water.2

Calvert and Water Advocacy

Calvert also supports water security through its shareholder advocacy efforts and policymaking initiatives.

Calvert was the first investment company to endorse the UN’s CEO Water Mandate. Launched in 2007, this seminal, private-public initiative helps corporations develop, implement, and disclose their water sustainability practices and policies. As of March 2012, there were over 90 endorsing members and growing.

Did you know it takes 388 gallons of water to produce one serving of beef?

Just last year, Calvert and Trillium Asset Management (Trillium) filed a joint shareholder resolution with Smuckers, calling for the company to report (within a six-month timeframe) on how it will manage the social and environmental risks and opportunities connected to the company’s coffee business and supply chain.

The H2Opportunity — Calvert Invests in Water

Calvert Solution™ Strategy funds focus on companies that produce products and services designed to solve some of the most pressing environmental and social challenges, such as access to clean drinking water. With the increasing global demand for water and lack of supply, the Calvert Global Water Fund (CFWAX) offers the opportunity to invest in companies in the fast-growing water services sector. It is important to remember that fast growing companies can have additional risk and may not be profitable. The companies we seek to invest in are those that appear to be positioned to do well on both sustainability and financial performance measures. Companies in this sector include providers of water treatment or filtration equipment, water-related equipment manufacturers and water utilities. Also included are water-related technologies such as distribution mechanisms, environmental monitoring and water conservation.

The fund’s subadvisor is Kleinwort Benson Investors International Ltd (KBI), a leader in water investing since 2000. KBI seeks to stay on top of the technological issues involved in the water cycle through its advisory committee of scientists.

According to Jens Peers, portfolio manager of the Calvert Global Water Fund: “The growing gap between supply and demand for fresh water creates a significant need for substantial investment in sustainable methods of obtaining and delivering water. The rapid rate of global urbanization is also a problem, as burgeoning urban populations overtax existing water systems and heighten the urgency for new infrastructure.”

Find out more about how Calvert invests in water every day and ways you can get involved by following the links below:

The water sector can be volatile. Investment involves risk, including possible loss of principal. Calvert Global Water Fund is subject to the risk that stocks that comprise the water-related sector may fall in value. The water industry can be significantly affected by economic trends or other conditions, such as the availability of water, the level of rainfall and occurrence of other climatic events, and changes in consumption, in addition to environmental considerations, taxation, and government regulation (including the cost of compliance). The Fund is non-diversified and may invest more of its assets in a smaller number of companies than a diversified fund; therefore, gains or losses on a single stock may have greater impact on the Fund. A downturn in the water-related sector would impact the Fund more than a fund that does not concentrate in this industry, and the Fund therefore may be more volatile than a typical mutual fund. Lastly, foreign investments involve greater risks than U.S. investments, including political and economic risks and the risk of currency fluctuations.

1. WATER: Oil Companies See Opportunity in Another Precious Commodity, Greenwire, July 28, 2008
2. Nikko Citi, Global Infrastructure Investment Growing, September 2009



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