Investors pressure tech firms on water usage

In Short:
– Investors are scrutinising Amazon, Microsoft, and Google over environmental impacts of U.S. data centres.
– Companies face shareholder pressure and community opposition, leading to halted data centre construction and calls for water usage transparency.

Investors are intensifying scrutiny on Amazon, Microsoft, and Alphabet’s Google regarding their environmental impact, particularly concerning water and power usage in U.S. data centers.These companies have recently halted construction on multi-billion dollar data centres due to community opposition and are facing pressure from shareholders in advance of annual meetings this spring.

Investors press companies

More than a dozen investors are requesting detailed information on tech companies’ water usage and conservation strategies.

Trillium Asset Management, managing over $4 billion in assets, submitted a resolution to Alphabet in December, seeking clarity on its climate goals amid rising energy demands from data centres.

The company committed to reduce emissions by half and transition to carbon-free energy by 2030, yet emissions have reportedly increased by 51%, leaving shareholders seeking transparency.

Trillium’s resolution last year received nearly 25% support from independent shareholders.

Green Century Capital Management is also engaging with Nvidia regarding a potential resolution aimed at ensuring AI advancements do not compromise long-term climate and financial stability.

Shareholders are concerned about the substantial water consumption of North American data centres, which reportedly used nearly 1 trillion litres of water in 2025.

Companies have implemented closed-loop cooling systems in their data centres to decrease water usage, but reporting on this remains inconsistent.

Meta’s environmental report indicated a 51% increase in water use from 2020 to 2024, while Google’s and Microsoft’s reports also have gaps, particularly regarding third-party operations.

Amazon has committed to improving site-specific water consumption disclosures and aims to be a responsible neighbour by increasing efficiency and reducing water use.

Investors stress the importance of site-level data to evaluate operational risks and the firms’ management of those risks.

A Microsoft representative affirmed the company’s commitment to environmental sustainability, while Google and Meta did not comment on the matter.

Local community engagement is becoming increasingly vital, according to the Data Center Coalition’s vice-president, who emphasised transparency about resource usage.

Community engagement key

Writing to shareholders has become essential for technology firms to communicate their sustainability efforts.

Investors are asking for clearer guidelines on how these companies intend to manage water resources moving forward.

There is a pressing need for stronger accountability among data centre operators to mitigate environmental impacts.

Ongoing discussions indicate a vital push for addressing climate change concerns from both investors and local communities.