The ESG in Credit series of reports provides insights on the credit relevance and materiality of sector-specific environmental, social and governance (ESG) credit issues and offer guidance on investor approaches to evaluating ESG risk factors in investment analysis and decisions. This report focuses on water issues – specifically, the two water-related general issues within Fitch Ratings’ ESG Relevance Score Framework and scoring templates: water and wastewater management, and water resource and management. It explains how water issues can translate into relevant water-related credit issues and potentially materialise as credit risks. Water Risks Are Important to Investors Investors are assessing their portfolios and holdings for water risks. A survey by RBC Global Asset Management reported that two-thirds of roughly 800 institutional investors in the US, Canada, Europe and Asia were factoring water risk into their investment decisions, placing water risk third behind cybersecurity and anti-corruption in a list of the most important ESG considerations. The focus on water risk is likely to continue. Allianz Global Corporate & Specialty SE, the corporate insurance provider of Allianz SE, identifies water management as one of five main ESG issues that will affect businesses’ ESG footprints.