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Ensure Honest Accounting

Current accounting systems fail to value environmental and social factors in business decision-making. Investors and companies too often “externalize,” or ignore, the ecological and human impacts from their activity. As a result, companies are able to exploit finite water resources at minimal cost and emit carbon freely. We must ensure that capital markets integrate the full costs of environmental and social factors in business strategies, risk management and public disclosure. Achieving this will ensure companies are rewarded for strong sustainable performance.

Honest AccountingCurrent accounting systems fail to value environmental and social factors in business decision-making. Investors and companies too often “externalize,” or ignore, the ecological and human impacts from their activity. As a result, companies are able to exploit finite water resources at minimal cost and emit carbon freely.

Ceres is working to ensure that capital markets integrate the full costs of environmental and social factors in business strategies, risk management and public disclosure. Achieving this will ensure companies are rewarded for strong sustainable performance.

How We'll Get There:

  1. Propel all companies to use a carbon ‘shadow’ price in capital investment decision-making and to share that information with investors.
  2. Ensure all analysts, rating agencies and financial firms are factoring environmental, social and governance risks and opportunities in their research and valuations.
  3. Integrate sustainability factors, such as water availability, forest protection and human rights, into company and investment decision-making.
  4. Embed sustainability factors into the disclosure requirements of key capital market drivers such as the Securities and Exchange Commission, New York Stock Exchange and Financial Accounting Standards Board.


Resources

Clearing the Waters: A Review of Corporate Water Risk Disclosure in SEC Filings
Jun 18, 2012
New Sector Analysis added: Ceres has added sector-by-sector analyses for each of the eight sectors reviewed in this report. Download this new version. This report finds that though overall corporate disclosures of water-related risks in financial filings have increased since 2009, much reporting remains weak and inconsistent especially in regard to data on overall water use, financial exposure and potential supply chain risks.
Restoring Flows: Financing the Next Generation of Water Systems A Strategy for Coalition Building
May 11, 2012
In this report, Ceres and American Rivers join forces to highlight the importance of bringing together environmentalists, economists, water utilities, water users, financial institutions, foundations, investors and labor groups to create opportunities for the creation of shared pursuits beyond the boundaries of politics, watersheds and economic sectors that typically define our relationship to water.
The Road to 2020: Corporate Progress on the Ceres Roadmap for Sustainability
Apr 25, 2012
The Road to 2020: Corporate Progress on The Ceres Roadmap for Sustainability assesses how U.S. businesses are progressing on sustainability and uses as a framework, The 21st Century Corporation: The Ceres Roadmap for Sustainability—a guide for integrating sustainability across a company’s entire enterprise. Specifically, it evaluates where 600 large publicly traded companies stand on sustainability issues in terms of governance, stakeholder engagement, disclosure and performance.
The Ripple Effect: Water Risk in the Municipal Bond Market
Oct 22, 2010
October 2010 - Growing water scarcity in many parts of the United States is a hidden financial risk for investors who buy the water and electric utility bonds that finance much of the country's vast water and power infrastructure, according to this first-ever report by Ceres and Water Asset Management. The report evaluates and ranks water scarcity risks for public water and power utilities in some of the country's most water-stressed regions, including Los Angeles, Phoenix, Dallas and Atlanta.
Canada's Oil Sands: Shrinking Window of Opportunity
May 14, 2010
May 2010 - This report examines how carbon and land reclamation regulations, climate change and other environmental and social issues may adversely affect the future of oil sands development in Alberta.