ESG & Investing

Thames Water Rocks ESG Funds With Sewage-Tainted Green Bonds

Some funds divested from the utility on sustainability risks
Thames Water has issued $3 billion of green bonds since 2022

WATCH: Thames Water is in crisis, facing possible nationalization and with a £13 billion debt pile. Eamon Farhat reports.Source: Bloomberg

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By Greg Ritchie and Frances Schwartzkopff

July 4, 2023 at 4:00 AM UTC

Updated on

July 4, 2023 at 3:20 PM UTC

This article is for subscribers only.

ESG funds that piled into green bonds sold by Thames Water Plc are now trying to figure out what the environmental, social and governance disasters threatening the future of the utility mean for their holdings.

The company, whose mismanagement left Britain’s rivers fouled with raw sewage, has sold four green bonds since the beginning of 2022, for a nominal total of €2.8 billion ($3 billion). More than 200 ESG funds purchased some of the debt, with their holdings having a market value of roughly $240 million, according to data compiled by Morningstar Direct.