Family offices and foundations look for impact opportunities in water

Rising global demand for water and the decline in reliable supplies means higher prices. That should drive a growing market in water efficiency, as farms, cities and industry value their water properly. And as public policy does the same, conservation efforts that restore degraded watersheds should also become investable.

That’s the argument in a new report from the ImPact and CREO that suggests the need for market-creation capital, including grants, from foundations and family offices.

Early investment opportunities include pay-for-success water bonds such as Washington, D.C.’s $25 million stormwater management impact bond and a promising “forest resilience bond” in California to improve water quality and reduce fire risk in Stanislaus National Forest.

The report includes more than a dozen investment profiles, including Beartooth Capital, which purchases land for restoration, and the Nature Conservancy, which is prototyping water investment structures, such as “permanent water rights” portfolios.

The McKinsey Global Institute estimates $7.5 trillion of water-related investment will be needed globally in the next 15 years.

This post originally appeared in ImpactAlpha's daily newsletter. Get The Brief.

Photo credit: The Nature Conservancy

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