BCI Responsible Investing Newsletter

BCI Responsible Investing Newsletter - April 2015

Issue link: https://uberflip.bci.ca/i/504717

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2 bcIMC RESPONSIBLE INVESTING NEWSLETTER From the CEO/CIO With demand for water projected to exceed 40 per cent by 2030 and the cost to meet that demand estimated at $50 to $60 billion each year for 20 years, it is critical that companies understand and manage related risks to their business. 1 bcIMC's job is to deliver the returns that our clients need to meet their future obligations. To ensure that we can do so, we want to know that the companies we invest in will continue to be successful on a long-term basis in a changing environment. To this end, we expect companies to be transparent about what issues they face, what processes are in place, what standards are tied to operations, and what future plans are underway to better manage the reality of water scarcity. We ask public companies to be forthcoming in disclosure. Risks faced by the companies in which we invest are potential risks to our investments. Transparent reporting helps us to better understand and manage risks to our investments. Through our participation in the CDP Water project, we know that in 2014 over two-thirds of Global 500 companies reported facing substantive water risks. We also know that three-quarters of reporting companies identified opportunities. 2 Water management represents a significant component of bcIMC's infrastructure portfolio. We principally hold long-term private investments in regulated water and wastewater utilities. Our involvement at the board level of these well-run companies enables us to play an active role in addressing long-term strategy and governance. As bcIMC is one of Canada's major property owners, water is also a primary operating consideration with real estate. Seventy per cent of all municipal water is consumed in and around buildings; irresponsible use and wastage increases building costs. 3 We implement specific strategies and technologies to reduce water consumption in both new and existing buildings, where practical, and where investment value exists in doing so. Contributing factors to today's water challenges include competing demands, increasing populations, and climate change. bcIMC has long worked to mitigate the effects of climate change on our portfolio, and those efforts also relate to water. Some of our more specific actions are outlined on the following pages. Gordon J. Fyfe Chief Executive Officer / Chief Investment Officer 1 2030 Water Resources Group 2 CDP Global Water Report 2014, From Water Risk to Value Creation 3 Canada Green Building Council

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