Environment and Interdisciplinary Development

Future Research of Sustainable Financing in Iran's Water and Sewage Industry

Document Type : Original Article

Authors

Narges Sarlak 1
MohammadHassan Maleki 2
Manijeh Ramesheh 1
Fariba Faghihi Fard 1

1 Department of Accounting, Faculty of Economics and Administrative Sciences, University of Qom, Qom, Iran

2 Department of Management, Faculty of Economics and Administrative Sciences, University of Qom, Qom, Iran

10.22034/envj.2025.480678.1418
Abstract
Introduction: Water is an essential natural resource that shapes regional landscapes and is vital for the functioning of ecosystems and the well-being of human life. Preserving this critical life-sustaining resource requires sustainable and stable planning, as well as sustainable financing in the water and wastewater sector. Accordingly, the present study aims to identify the key drivers influencing sustainable financing in the water and wastewater industry.
Materials and Methods: In terms of purpose, this study is exploratory, and in terms of orientation, it is applied. Data were collected through both fieldwork and library research, following deductive and inductive reasoning. The methodology is quantitative. In this research, the Fuzzy Delphi technique was employed for the initial screening of drivers, and subsequently, the EDAS (Evaluation based on Distance from Average Solution) technique was used to rank the screened drivers. The theoretical population of the study consisted of managers and experts in the water and wastewater industry. After identifying and ranking the drivers, research scenarios were developed using the two principal drivers that achieved the highest rankings based on the EDAS technique. Accordingly, four scenarios were designed. The Marcus technique was then applied to identify the most plausible scenario.
Results: Based on the literature review and expert interviews, 25 drivers were initially identified. These drivers were subsequently screened using the Fuzzy Delphi method. At this stage, 17 drivers with defuzzified values below 0.6 were eliminated, and 8 factors were selected to develop the driver impact model. The eight key drivers identified in this study are: feasibility assessment methods of water and wastewater projects; the level of transparency in water and wastewater projects; legal requirements for sustainability reporting in the water and wastewater industry; governing policies over water transfer and distribution projects in the country; diversity of financing methods in the country; water pricing; development of green financial instruments; and policies for evaluating technologies used in water and wastewater treatment projects. The screened drivers were then ranked using the EDAS technique based on three criteria: degree of certainty, intensity of importance, and experts’ level of expertise. Among these criteria, intensity of importance and experts’ expertise had a positive effect, while degree of certainty had a negative effect. The EDAS ranking results identified two key drivers: legal requirements for sustainability reporting and diversity of financing methods. Based on these two drivers, four scenarios were developed. Application of the Marcus technique indicated that the most probable future scenario for sustainable financing in Iran’s water and wastewater industry is Scenario Four, which represents the most pessimistic scenario. According to this scenario, both the legal requirements for sustainability reporting and the diversity of financing methods are expected to be in an unfavorable state in the future. 
Discussion: Potential Scenario – The Worst-Case Scenario Arising from the Adverse State of Two Key Drivers: Legal Requirements for Sustainability Reporting and Diversity in Financing Methods
The first driver is the growing global importance of legal requirements for sustainability reporting. In this scenario, it is anticipated that regulations related to sustainability reporting in the water and wastewater sector may not be effectively implemented, or may encounter significant challenges in compliance. This could result in decreased transparency in projects, which in turn would lead to a reduction in public trust and investor confidence in the industry. The second driver concerns the diversity of financing methods. In the fourth scenario, a reduction in the diversity of financial resources and limited access to innovative financing methods, such as green bonds and other sustainable financial instruments, would severely impact the financial resources of the sector. This situation could present significant challenges to the growth and development of water and wastewater projects, especially in regions facing resource scarcity. Therefore, strengthening these two drivers is crucial as a priority to prevent this pessimistic scenario.

Keywords

Future
Driver
Sustainable Financing
Water and Sewage

Subjects

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Environment and Interdisciplinary Development
Volume 10, Issue 90
Autumn 2025
Pages 62-80

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