The past few years we have witnessed financial institutions, including banks, invest in clean energy projects. Bank of America is one example of a company that has invested in renewables, but now there are signs water will be the next frontier of both investment and social responsibility within the financial sector. Two of the largest banks in the United States have taken bold action on addressing the growing water disaster underway worldwide.
Recently BofA and Wells Fargo each announced US$1 million commitments to water projects. Both companies conduct a brisk business in California, which is lurching towards a worsening drought crisis. And much of the world is struggling with diminishing supplies of fresh water while local populations grow and citizens demand more of it. If the banks are starting to take water seriously, then finally this precious but undervalued resource may finally start scoring the investment and resources that are desperately needed.
Bank of America has partnered with Water.org, a social enterprise founded by Matt Damon and Gary White that uses market-based solutions to expand access to water around the world. The organization has long worked with large companies to develop long-term and sustainable answers to water challenges. The $1 million grant that Bank of America promised to Water.org will allow as many as 100,000 microloans for securing access to clean and safe water in India. Water.org’s most successful program in India and other developing nations has been WaterCredit, a microfinance program that allows citizens to borrow money to access municipal taps, build and maintain toilets or start small businesses related to water and sanitation needs.
Meanwhile Wells Fargo has committed $1 million to Imagine H2O, an NGO that runs several programs focused on entrepreneurs working on water-related technologies and innovations. Imagine H2O in wrapped up its sixth annual water competition, at which it announced US$200,000 in cash and in-kind services to two start-ups. According to Wells Fargo, the funds given to Imagine H2O are part of bank’s program offering a total of US$100 million by 2020 to non-profits and universities in order to boost the emerging “green” economy.
Banks wishing to make an impact on the sustainability front should consider grants similar to that of Bank of America and Wells Fargo for several reasons. First, as we are currently experiencing here in California, entire economies are threatened with collapse if there is not enough water to sustain people, businesses and agriculture. In addition, as dark as future scenarios appear to be in a world with less water, there are also numerous opportunities for investment, from water recycling to infrastructure projects.
Finally, what these banks have done is not a simple act of corporate philanthropy: they have invested in organizations that have a reputation for finding new ways to address the water crisis instead of slapping a band-aid on what is an increasingly difficult challenge. Whether they are protecting businesses in California or improving water security in countries that are the home of many companies’ supply chain, ensuring continued supplies of water is one of the most compelling risk management strategies a financial institution can tackle.
Based in Fresno, California, Leon Kaye is a business writer and strategic communications specialist. He has also been featured in The Guardian, Clean Technica, Sustainable Brands, Earth911, Inhabitat, Architect Magazine and Wired.com. When he has time, he shares his thoughts on his own site, GreenGoPost.com. Follow him on Twitter and Instagram.
Image credit: Water.org’s Flickr page
Leon Kaye has written for TriplePundit since 2010, and became its Executive Editor in 2018. He's based in Fresno, CA, from where he happily explores California’s stellar Central Coast and the national parks in the Sierra Nevadas. He's worked and lived in South Korea, the United Arab Emirates and Uruguay, and has traveled to over 70 countries. He's an alum of the University of Maryland, Baltimore County and the University of Southern California.