The Importance of Improved Water Risk Metrics in Sustainable Reporting

Critical industrial and manufacturing processes depend on the availability and quality of freshwater. As a result, disruptions in freshwater availability may pose financially material risks to investors. However, corporate disclosure and data remain a challenge due to lack of standardization and difficulties collecting data. In light of these limitations, Calvert utilizes a proprietary method to assess water risks at the sector and company level, while encouraging companies to coalesce to develop water reporting protocol similar to the Greenhouse Gas reporting protocol.

Investors and corporate leaders are struggling to keep up with the pace of political events, which are largely orchestrated by the new Trump administration. More than ever, investors should take heed and re-examine a now engrained view that U.S. equities remain the only game in town. The U.S. is increasingly pursuing more isolationist economic and foreign policies. We believe this may create greater cohesion and cooperation among regions like Europe.

The valuation differential between international and U.S. Equity remains one of the strongest arguments for considering an allocation outside the U.S., even with the outperformance experienced so far in 2025. While many drivers behind a more constructive outlook on the merits of an allocation to international equity are macro related, our confidence is built from the bottom up, through a stock picker’s lens. At the heart of our investment approach is a commitment to investing in sustainable business models as the mechanism to compound assets for our clients.

Calvert believes that the responsible investment landscape stands at a critical intersection of environmental urgency, technological revolution, and social transformation.