12 May 2021Working Paper Summaries

Accounting for Product Impact in the Water Utilities Industry

by George Serafeim and Katie Trinh

Using a framework for measuring and monitoring product impact in a systematic way, this paper compares two competitor companies in the water utilities industry. Results demonstrate the potential for product impact measurement to inform strategic decision-making.

Author Abstract

We apply the product impact measurement framework of the Impact-Weighted Accounts Initiative (IWAI) in two competitor companies within the water utilities industry. We design a monetization methodology that allows us to calculate monetary impact estimates of water leakages and disruptions and contaminants, among other factors. Our results indicate substantial differences in the impact that competitors have through their products. These differences demonstrate how impact reflects corporate strategy and informs decision-making on industry-specific areas, including infrastructure investment choices.