Water disclosure project releases first results

The Carbon Disclosure Project (CDP) has announced the launch of its first report on the impact of water constraints on the world's largest companies.

The CDP report findings showed that water is already impacting business operations with 96 per cent of responding companies able to identify whether or not they are exposed to water risk and more than half of those reporting risks classifying them as current or near-term (one to five years). 39 per cent of companies are already experiencing detrimental impacts relating to water including disruption to operations from drought or flooding. Other impacts included declining water quality necessitating costly on-site pre-treatment, and increases in water prices, as well as fines and litigation relating to pollution incidents.

The CDP's Water Disclosure sent its first annual questionnaire to 302 of the world's largest corporations requesting information on their water use and water-related business issues. It received 150 replies from the questionnaire with 122 of these responding publicly and an added 25 companies responding on a purely voluntary basis, bringing the total up to 175.

It provided this information to 137 institutional investors with US$16 trillion in assets, in order to increase transparency and accountability on water scarcity, and to inform the global market place on investment risks and commercial opportunities. The data should provide an insight into the strategies deployed by many of the largest companies in the world in relation to water use and will be used to help drive sustainability so companies can better manage its use.

As a foreword to the CDP report Paul Dickinson, Executive Chairman of the CDP, wrote: "Water Disclosure's goal is to make meaningful, systematic and comparable reporting on water a standard corporate practice globally, enabling investors, companies themselves, governments and other stakeholders to put this data at the heart of their decision making.

The 2030 Water Resources Group estimated that demand for water could overtake supply by 40 per cent in 2030, with an estimated 50 per cent of the world's population expected to live in regions of high water stress. It means the changing availability of water can present opportunities for businesses from the demand for new infrastructure, products and services.

In their 2006 book The Atlas of Water, R. Clarke & J. King stipulated that 35 per cent of human water use is unsustainable. They acknowledged water efficiency is being improved on a global scale by improved water productivity of agriculture, addressing shortages in the non-industrialised world and concentrating food production in areas of high productivity, as well as planning for climate change. At the local level, people are becoming more self-sufficient by harvesting rainwater and reducing use of mains water.

A review of water use in industry and commerce in 2009 for England and Wales by envirowise.wrap.org.uk classified the electricity, gas, steam and hot water supply sector as using the most water, with Agriculture, hunting and related service activities a distant second, using half the amount.

Water covers 71 per cent of the Earth's surface and though with its report the CDP has focused on the business impact of the resource, there is no doubt availability of water affects all our lives.

The CDP Water Disclosure report, prepared by Environmental Resource Management (ERM) is available at cdpproject.net.

Author: Leroy Robinson| Climate Action

Image: Snap| Flickr