Companies Estimate Over US$2 Billion in Financial Risks From Glacier Melt Alone

Companies responding to CDP's water security questionnaire estimate an average of more than US$2 billion in water-related financial risks stemming from glacial melt, as glaciers worldwide shrink at accelerating rates threatening freshwater supply for nearly 2 billion people. CDP is working through the Fair Water Footprints initiative to transform how the global economy measures, values, and manages water.

The UN has designated 2025 the International Year of Glaciers' Preservation, highlighting a growing crisis: meltwater from glaciers has long been a critical freshwater source for communities and industries, but shrinking glaciers are creating supply disruptions and rising operational costs for companies dependent on seasonal meltwater. CDP's water security questionnaire data for 2023 shows companies reported a potential financial impact of US$596 billion in water-related risks — more than five times the US$100 billion cost of mitigating those risks. The average company estimates over US$2 billion in risks from glacial melt alone.

CDP is participating in the Fair Water Footprints initiative, a partnership of national governments, the private sector, and civil society working to embed sustainable water practices across global supply chains. The initiative defines a Fair Water Footprint as one that accounts for both environmental and social impacts, ensuring water security, zero pollution, ecosystem protection, and equitable access to sanitation. CDP's integrated questionnaire has been aligned with the Fair Water Footprints framework to make it easier for companies to measure and reduce their water impacts. Nearly 25,000 companies already disclose environmental data through CDP.

For Indian companies, water risk is a material financial concern given the country's dependence on monsoon-linked freshwater systems, glacier-fed rivers in the north, and groundwater aquifers under mounting pressure from agricultural and industrial demand. Sectors including textiles, beverages, agriculture, and cement face overlapping exposure to both physical water scarcity and regulatory risks as water pricing mechanisms gain traction globally. CDP's call for companies to join the Fair Water Footprints initiative and adopt internal water pricing is particularly relevant for India-based manufacturers with complex, water-intensive supply chains.

Key figure — US$596 billion in potential water-related financial impacts disclosed by companies in 2023