Preqin ESG Solutions 45 We assume that the proportion for private companies is the same as that extracted from public company data. Employee count and voluntarily disclosures of water withdrawal for public market companies are provided by Disclosure, Insight, Action (CDP). The intensity of water withdrawals per employee depends on the industry. In general, generating Geothermal energy will require more withdrawn water per employee than developing Accounting/Finance Software. Therefore, for each industry we obtain a di昀昀erent proportion. This enables us to estimate water withdrawals for each company active in a given industry based on the number of its employees. The data on industry classi昀椀cation comes from the Preqin Pro proprietary data base. It is veri昀椀ed, cross-checked, and curated. The magnitude of company’s water withdrawals varies according to the abundance of freshwater sources, quality of infrastructure, and usage patterns in the country in which it operates. For example, a company based in Canada will, on average withdraw more water than one operating in Chad. We treat the location of a company’s headquarters as the county in which it operates. Having used World Bank data to rank all 13 countries by their water productivity , we assign each country a modi昀椀er of up to ±50%, based on our ranking. This geographic adjustment is our de昀椀nition of water e昀케ciency that we use to re昀椀ne every initial proxy. The model we use to calculate our estimates assumes the following: 1. Water withdrawals grow linearly with the number of employees 2. The patterns of withdrawing water per employee are similar for public and private companies within a given industry 3. The population of public 昀椀rms that voluntarily disclose their data to CDP exhibits no selection bias 4. There is a relationship between water e昀케ciencies at the country and company levels We plan to revisit these assumptions and further re昀椀ne them as the scope and granularity of available data increases. ↗ Back to Contents