How do Water Companies Address Environmental Indicators in their ESG Reports?

As climate change is becoming an increasingly crucial issue, it has become critical for firms to report on their Environmental, Social, and Governance (ESG) aspects. In particular, this research analyzes how environmental indicators are dealt with and reported on. In the case study examined, namely the company American Water Works, GHG emissions and water management were the most important issues to the stakeholders according to the materiality assessment. It was found that the firm has significantly reduced its GHG emissions, and it is on track to meet its target of 40% reduction by 2025. This was achieved mostly through corporate power purchase agreements, although the Sustainability Report focuses on improvements to the energy efficiency of infrastructure. This underscores the possibility that companies represent ESG data in ways that are convenient to guarantee a more sustainable image in the long term, at the cost of a complete portrayal of their ESG practices. Moreover, Scope 3 emissions are not verified through a third party, which is key to ensuring the rigor and transparency of carbon emissions, and no Net Zero emissions target is mentioned in such report. For what regards water management, the Sustainability Report contains the target of reducing water per customer by 15% by 2035. Nevertheless, the report lacks a mention of Net Zero groundwater abstraction and a leakage reduction target.