This article is the second in a three part-series on water management, water use and water demand. Part 1 was published on December 9, 2024, and part 3 will be published on December 16, 2024
Investment Insights • Sustainability
3 min read
Water security in a world of growing scarcity and pollution
Water is the essence of life, yet billions around the world struggle to access this vital resource. As our global population swells and climate change intensifies, ensuring safe and sufficient water supply has never been more critical. This article delves into the current state of water access, the mounting pressures of water stress, the challenges of maintaining water quality and the innovative solutions paving the way towards a sustainable future.
Melanie Beyeler
Access to safe drinking water, declared a human right by the UN in 2010,1 remains out of reach for billions, highlighting the urgent need for effective global action. By 2022, 2.2 billion people still lacked safe drinking water, and 3.5 billion were without adequate sanitation, leading to significant health and social issues, especially in rural areas.2 Water scarcity now affects half of the global population at least part of the year, with a quarter facing extreme shortages and relying heavily on dwindling groundwater reserves critical for drinking and farming.2
The growing impact of climate change further complicates these challenges. More extreme weather patterns, including prolonged droughts and unpredictable rainfall, exacerbate water scarcity and threaten supply reliability. These changes add pressure on water systems worldwide, increasing the need for effective management and conservation practices to safeguard limited resources.
As economies develop, the nature of challenges around water pollution shifts, further complicating access to safe water.3 Low-income countries often struggle with inadequate wastewater treatment, while wealthier regions grapple with pollutants such as agricultural runoff, pharmaceuticals and microplastics – each posing significant risks to human health and ecosystems. Globally, nearly half of wastewater is discharged untreated, contaminating rivers and oceans, and exposing billions to unsafe water.4 In continental Europe, only 40% of surface waters met ‘good’ ecological status by 2015,5 while in the UK, the figure was a mere 14%.6
Growing awareness of the impact of water pollution has driven proactive solutions, with policy advancements and technological innovations emerging to tackle these pressing contamination issues. Examples include:
- Strengthening regulations: Stricter water quality standards and enhanced enforcement are crucial. The EU’s Urban Wastewater Treatment Directive and its Drinking Water Directive target emerging contaminants, while the US EPA is ramping up PFAS regulations, compelling industries to innovate and meet higher standards.
- Advanced water treatment: With persistent pollutants like PFAS gaining attention, advanced water treatment technologies are becoming essential. Methods like nanofiltration and UV disinfection can effectively remove these “forever chemicals” linked to health issues such as cancer and immune system impairment.
- Embracing water recycling: Water recycling, which treats and reuses wastewater for various applications, is another key strategy. Advanced recycling technologies now produce drinking water more cost-effectively than desalination. Policies like the EU’s Water Reuse Regulation (WRR) encourage adoption, though implementation depends on regional needs and capacities.
In addition to these regulatory and technological advancements, water conservation practices are vital. Implementing efficient irrigation methods, reducing industrial water use, and promoting household conservation can collectively reduce demand and extend the lifespan of existing resources, especially in water-scarce regions.
Securing universal access to safe and reliable water is essential as population growth and climate change heighten water scarcity and pollution. Despite ongoing challenges, advancements in treatment technologies, stronger regulations, and water recycling, offer promising solutions. Achieving water security will require cooperation, commitment to innovation and robust regulatory standards across sectors. By investing in these solutions, we can protect this invaluable resource for future generations and move closer to a world where safe water is accessible to all.
1 World Health Organization (WHO), Guidelines for drinking-water quality, 2022
2 UNESCO, The United Nations World Water Development Report 2024
3 Desbureaux et al. Mapping global hotspots and trends of water quality (1992–2010): A data driven approach. Environmental Research Letters, 2022
4 UN Water, World Water Development Report 2023
5 https://www.eea.europa.eu/en/analysis/indicators/ecological-status-of-surface-waters
6 House of Commons Environmental Audit Committee, Water quality in rivers, 2022
Melanie Beyeler
Melanie joined EFGAM Switzerland in August 2017 and is responsible for the Climate Transition strategy. Previously she held a variety of roles at Credit Suisse including equity institutional sales and client portfolio manager.
Melanie holds a Masters HSG in Banking and Finance from the University of St. Gallen and was awarded the CFA UK Certificate in Climate and Investing. In addition, she has successfully completed the “Sustainable Finance” program at the University of Cambridge and the “Business Sustainability Strategy” program at MIT Sloan School of Management.