Water crises is the third highest global risk of concern in the World Economic Forum’s Global Risks 2014 report.

According to the report, this illustrates a continued and growing awareness of the global water crisis as a result of mismanagement and increased competition for already scarce water resources.

Environmental risks feature prominently in this year’s list. Water crises coupled with extreme weather events such as floods and droughts, which appears sixth on the list, show that“the potential impacts are real and happening today.”

The report says geopolitical tensions over access to strategic water resources could have a have systemic impact in the future, and water shortage coupled with poverty and societal instability could weaken intra-state cohesion.

That management of water is becoming increasingly complex and difficult as populations expand and demand for freshwater to supply cities and factories increases. Any failings in planning, management and use in one country can ripple across the world

Water quality is also a critical issue. Poor water quality or shortages are often blamed on business operations, even when businesses comply with regulatory requirements. In parts of the world, water pollution incidents have paralysed business operations, disrupting global value chains and damaging corporate reputations.

The report recommends investment in information, institutions and infrastructure. “But successful water management needs the cooperation of a wide network of water users, public and private institutions.”