The artificial intelligence (AI) boom is at the forefront of one of the most transformational periods in modern history. However, the rise of AI comes with an increasing demand for water to cool the energy-intensive data centers that power AI computations. As the water withdrawal required to quench global AI demand is expected to reach up to 6.6 billion cubic meters in 2027, and the UN predicts that nearly half of the world’s population will face the risk of serious water scarcity by 2040, many investors are paying closer attention to the sustainability risks associated with rising data center demand. 

This report highlights the key water risk trends associated with artificial intelligence usage, and assesses how companies in the Software & Services industry are currently managing their water risks. It also provides a case study on the Big 4 data center companies – Amazon, Google, Meta, and Microsoft – assessing their relative performance as the market leaders in AI investment.

Readers of the report will learn about:

• How the Big 4 data center companies - Amazon, Google, Meta, and Microsoft - perform with respect to water use, withdrawal, and management.
• The operational, regulatory, reputational, and legal risks driven by data center-associated water scarcity.
• The best practices for investors seeking stronger management of water risks.