Article last updated 30 September 2025.
When I’m looking at technology investments, I think it’s helpful to hunt for ways that software and modern gadgets can solve the real world problems of industry and agriculture. Often, some of the most exciting developments are in what many consider humdrum sectors.
Water-heating isn’t exactly a sexy subject, but it combines two of the most important fronts of the resource efficiency fight: water and energy. AO Smith, a Milwaukee-based boilermaker, is the largest manufacturer of water-heaters for homes and businesses in North America. It has led the way in electric, gas, and solar appliances, with innovations that slash power bills for people and businesses alike. Heating water is energy intensive, so quality boilers can significantly reduce the day-to-day emissions of households and small companies. This company is also ahead on doing right by its communities: the AO Smith Foundation has helped fund a range of charitable, scientific and educational works near company plants since the 1950s. The Foundation continues to be funded from the company’s profits today.
AO Smith, which I own in the fund, has an Asian water treatment business as well. It helps to improve water quality and reduce the strain on our most precious resource. This water treatment division is expanding rapidly and should continue to do so for years to come. As the population grows — and developing nations become richer — the demand on the earth’s fresh water is expected to grow significantly. By 2030, global water demand is forecast to be 40% higher than sustainable demand, unless we change our practices dramatically. This is according to the United Nations Environment Programme.
Thankfully, there is plenty of scope to streamline how we use water. In the US, almost a fifth of fresh water supply is lost through leaking pipes and theft. In Brazil, such wastage accounts for nearly half. That’s why I see such promise in smart- metering companies — one that I’ve had my eye on is a Milwaukee-based company that operates all over the world.
Smart-meters are digital tools that help households and businesses keep track of their water usage. That saves them money and all of us precious water. The metering company has also partnered with telco giant AT&T to offer all-encompassing digital flow-measurement systems that towns and cities can use to better manage their infrastructure. Being able to spot the warning signs of leaks and problems from a centralised, remote system means less time on manned inspections and quicker fixes to leaks and breaches. Local governments have more cash in their coffers to improve their pipes, keeping water from being wasted, and deliver better community services elsewhere.
By far the greatest use of water is for growing and raising the food we eat. Watering the fruit, nuts, grains, grass and animals that are destined for our stomachs accounts for somewhere in the region of 70-80% of all the water we use worldwide. Technology can have a massive impact here as well.
Well, this company has spread far beyond that urban origin and has taken its business into the fields. One of its most exciting divisions uses GPS technology to remotely steer farm machinery, like harvesters. It also designs soil monitoring systems that can pinpoint exactly which areas of a farm need water or fertiliser and those places that don’t.
Rather than simply throwing water and nitrogen around liberally all over the place, farmers can be much more sparing, saving them money and helping conserve the world’s resources. It’s technology like this that really gives me hope about our ability to reduce our impact on the planet.
One Silicon Valley company that I bought soon after returning from my trip is leading location services, tracking and land survey firm Trimble. Think of the highly calibrated machines that engineers use to take exact measurements of ground levels and ensure real-life buildings match the plans. The yellow-legged ones you see in the street with robotic laser optics whirring around after high-viz-jacket-wearing surveyors. Or, for those eagle-eyed commuters, the laser machines suspended above Underground platforms to ensure nothing is sinking faster than it should.
It’s not about companies that ‘pivot’ to tech — that pretend to be something they’re not. I think you need to look for those companies that are taking good technology out into the world to solve real problems.
Increasingly investors are demanding that companies show they act ethically, source sustainably and don’t abuse the planet. Rathbone Global Sustainability Fund manager David Harrison’s report ' In pursuit of green' shows American companies are starting to take notice. If American companies – some of the most profit-focused businesses on Earth – can be swayed to become sustainable, anyone can.
Visit our 'in pursuit of green' hub.