{"id":1082,"date":"2008-11-13T11:33:35","date_gmt":"2008-11-13T11:33:35","guid":{"rendered":"http:\/\/astraea.net\/blog\/?p=1082"},"modified":"2009-10-23T11:38:21","modified_gmt":"2009-10-23T11:38:21","slug":"swimming-in-dwindling-waters-ethical-corp","status":"publish","type":"post","link":"https:\/\/www.astraea.net\/blog\/swimming-in-dwindling-waters-ethical-corp\/","title":{"rendered":"Swimming in dwindling waters – Ethical Corp"},"content":{"rendered":"

Water resources: Efficiency and conservation \u2013 Swimming in dwindling waters<\/strong><\/a><\/p>\n

As the planet\u2019s once plentiful blue resource gets used up, companies are acting to secure supply and be more efficient users of water<\/p>\n

by Oliver Balch, Ethical Corp<\/a><\/p>\n

Kazakhstan\u2019s mapmakers have their work cut out. No sooner do they chart the boundaries of the Aral Sea than they have to take out their pens and redraw it.<\/p>\n

Once the world\u2019s fourth largest inland sea, this massive expanse of water has shrunk to a tenth of its original size due to a huge irrigation project introduced in the 1960s. The fishing industry is now floundering, the flora and fauna perishing and the summers becoming hotter and hotter.<\/p>\n

The fate of the Aral Sea is not unique. The world\u2019s water supplies are drying up. Half of the planet\u2019s wetlands have disappeared over the past century. In Europe, six in every 10 cities with more than 100,000 people are using their groundwater supplies at a faster rate than they are being replenished, the European Environment Agency reports.<\/p>\n

Water experts have coined the phrase \u201cwater stressed\u201d to describe the scenario, where countries lack enough water to meet people’s needs. It\u2019s reckoned that the UK, for example, uses 4,654 litres of water per day per person.<\/p>\n

Today, about 440 million people, including the inhabitants of European states such as Denmark and Poland, live in countries that are water stressed. In much of the Middle East and some parts of Africa the situation is even worse.<\/p>\n

The outlook is not encouraging. By 2075, the number of people in regions with chronic water shortages is estimated to be between three and seven billion, according to the Stockholm International Water Institute.<\/p>\n

Little wonder, therefore, that the normally moderate United Nations recently defined the world\u2019s water crisis as \u201cone of the largest public health issues of our time\u201d.<\/p>\n

So what\u2019s behind the water scarcity? In short: man. The world\u2019s population has tripled over the past century and is expected to increase by about 50% to more than nine billion by 2050.<\/p>\n

Simple population growth is not the whole answer, however. Rapid rates of industrialisation, urbanisation and wealth accumulation mean that people are now using on average six times more water than they were a century ago. Water consumption is expected to continue doubling every two decades, a recent report by Goldman Sachs says.<\/p>\n

Virtually every industrial activity requires water. The likes of power-generation, mining, paper and drinks sectors are particularly water intensive. Non-industrial services, meanwhile, such as tourism and entertainment, can depend heavily on water resources as well.<\/p>\n

Even the water that industry doesn\u2019t use up is often made unpotable. Back in 2001, before an official crackdown on pollution, Chinese businesses were dumping an estimated 23.4bn tonnes of sewage and industrial waste a year into the Yangtze river. In Europe, only five of the continent\u2019s primary rivers are considered pollution-free.<\/p>\n

Farming\u2019s thirst<\/strong><\/p>\n

By far the biggest water-use culprit, however, is agriculture. Farmers are thought to be responsible for 70% of all human water use. That percentage is set to rise, according to the Sri Lanka-based International Water Management Institute. Farmers will need 2,000tn litres of water a year by 2030 to keep pace with the world\u2019s growing food needs, the institute says.<\/p>\n

There will be an additional manmade threat to world water supplies in the coming century: climate change. Environmentalists predict that global warming will increase evaporation rates across much of the planet and cause freshwater held in glaciers to melt. Rainfall could also drop off dramatically in some parts of the world.<\/p>\n

According to a study last year by the International Panel on Climate Change, water scarcity as a result of global warming will be most acute in China and Australia. The IPCC also predicts that parts of Europe and the US will be adversely affected.<\/p>\n

It\u2019s not only policymakers that need to worry about a world with less water. Business should be concerned too. Today\u2019s panic over the scarcity of credit could be minor in comparison with tomorrow\u2019s threat of water scarcity.<\/p>\n

\u201cLack of water of adequate quality directly reduces production,\u201d says Marc Levinson in a recent report by the investment bank JP Morgan. Agriculture, drinks and food processing are most vulnerable to water shortages, he says. All businesses, however, would be affected by the increased input costs that would result from diminishing water supplies. Companies would also see their capital expenditure rise as they were forced to find expensive new ways of treating and extracting water.<\/p>\n

Levinson raises the further spectre of regulatory risk. To date, rules governing water use and discharge have been relatively light for companies. Many countries subsidise water use for agriculture. Introducing water permits and fixed prices are two obvious ways governments could intervene to control water use.<\/p>\n

Drought-hit Australia shows what might be round the regulatory corner. Earlier this year, it introduced a cap on ground and surface water usage for the Murray-Darling Basin, the country\u2019s most important agricultural area.<\/p>\n

The probability of reputation damage presents a third major risk for the business community. As access to water decreases, people will be looking to point the blame. \u201cWater is a very emotional issue and, although business isn\u2019t the biggest user of water, it risks being the first to be cut off,\u201d says Anne L\u00e9onore Boffi, water project office at the Geneva-based World Business Council for Sustainable Development.<\/p>\n

Coca-Cola knows this only too well. Five years ago, campaigners in the south Indian state of Kerala began blaming the US soft-drinks company for a sudden shortfall in local water supplies, dubbing it \u201cKilla Cola\u201d. Its bottling plants were accused of polluting local aquifers.<\/p>\n

Many risks lurk in multinationals\u2019 supply chains rather than their own direct activities: food and drink companies, for example, depend heavily on irrigated agriculture for raw materials.<\/p>\n

JP Morgan estimates that the combined water consumption of Nestl\u00e9, Unilever, Anheuser-Busch, Coca-Cola and Danone approaches 575bn litres a year \u2013 enough to cover the daily basic water needs of everyone on the planet.<\/p>\n

Any limits on water supply, therefore, could have huge impacts in terms of manufacturing disruptions, increased commodity costs and higher power bills. The recent jump in world food and grain prices, which was caused in part by the water supply shortages that resulted from severe flooding and droughts, bears this out.<\/p>\n

Unilever\u2019s experience in Ghana proves salutary. In 2007, the Anglo-Dutch consumer goods giant was compelled to cut power consumption by 25% and buy expensive diesel generators when low rains impeded the country\u2019s hydropower capacity.<\/p>\n

Company innovation<\/strong><\/p>\n

The message that water scarcity poses a huge threat for economic growth is beginning to be heeded by private sector leaders.<\/p>\n

In some incidences, technological innovation is helping industry reduce water use. Drip irrigation, for example, presents huge potential savings for farmers. By using plastic pipes that release water directly onto the roots of the plants, it is no longer necessary to flood entire fields.<\/p>\n

Desalination is another area of recent advances. Spain, Europe\u2019s leader in desalination technology, has installed two desalination plants and has plans to build five more. Treated seawater is expected eventually to provide a fifth of all drinking water for southern Spain.<\/p>\n

The United Arab Emirates is one step ahead. Its Jebel Ali plant, the largest desalination facility in the world, is capable of producing 2,500 gallons of water per second.<\/p>\n

Western Corridor Recycled Water, meanwhile, is experimenting with an innovative alternative. By using microfiltration, reverse osmosis and other wastewater treatment technology, the public-owned Australian company has succeeded in converting sewage into purified water for the national grid.<\/p>\n

On a company by company basis, leaders are also beginning to emerge. Since 2000, the Stockholm International Water Institute has run an annual industry award aimed at promoting innovative water management solutions by business.<\/p>\n

Past winners include carmaker General Motors for its extensive use of water treatment in its facilities in an arid area of Mexico and consumer goods giant Procter & Gamble for PuR, a household water purifying system.<\/p>\n

Water strategy<\/strong><\/p>\n

As the private sector begins to address the issue of water use more attentively, certain commonalities in management approach are evident. Emerging protocols on water use, such as the United Nations CEO Water Mandate, are speeding up this process of convergence.<\/p>\n

In practical terms, an obvious first step for companies is to map their water use. How to establishing an overall water \u201cfootprint\u201d remains unresolved, as it touches on issues such as water quality in addition to water use. However, leading companies are developing inventory systems to audit at least their direct water abstraction and consumption.<\/p>\n

Again, international initiatives are serving to facilitate water use mapping. WBCSD, for example, last year launched a Global Water Tool to help companies calculate their global water consumption and efficiency. In addition, the tool helps managers assess the relative water risks in their operational portfolio.<\/p>\n

Once companies have a hold on their overall water use, the next phase is obviously to reduce it. The most popular approaches include measures for greater efficiency, recycling and reuse, and employee education.<\/p>\n

Drinks firm Diageo provides a good example of current management thinking. Its water strategy aims to first omit water use wherever possible. The company reduced its water consumption in Africa by 14% in 2006.<\/p>\n

Then it commits to \u201creduce, reuse and recycle\u201d. Finally, it pledges to dispose of the wastewater that it cannot recycle responsibly. Effluent from one of its Irish breweries, for example, is used to fertilise a willow plantation, which is then harvested for wood chips.<\/p>\n

Diageo has extended its water reduction policy into its worldwide community programme. Under the Water of Life banner, the company earmarks 0.5% of all profits from African operations to charitable water projects.<\/p>\n

Australian miner Rio Tinto has taken a similar tack. In Cameroon, for example, it has helped install water wells for communities close to its Alucam aluminium smelter. The project stems from the company\u2019s commitment to support the UN Millennium Development Goal of halving the number of people without access to safe drinking water by 2015.<\/p>\n

Getting vocal<\/strong><\/p>\n

Leading companies are now making more noise about their water efforts. Swiss food giant Nestl\u00e9 is among the more vocal and transparent. Its Water Management Report, published in March 2007, provides data on water consumption per kilogramme of product. The company\u2019s figures indicate a 27% reduction in water use between 2002 and 2006, saving 47bn litres.<\/p>\n

Even for those companies that have recognised water\u2019s importance, a number of management challenges remain.<\/p>\n

The most important of these occur on the supply side. For a global business to simply map its water impact through its value chain is vastly complex. Weak regulatory oversight often leaves companies without local data, says Nick Mattison, managing director at the environmental research organisation TruCost. He says: \u201cSeveral companies don\u2019t record water abstraction, for example, because often the regulator doesn\u2019t require it.\u201d<\/p>\n

Companies are feeling the pressure at the consumer end of their value chains as well. Attention is increasingly being paid to the amount of water that using a product entails. Responsible marketing provides some potential answers. Procter & Gamble, for instance, recently introduced a Future Friendly label to direct consumers to its most sustainable products.<\/p>\n

Design innovation, however, promises to make the most significant difference. Again, Procter & Gamble provides a good example: it recently launched a soap in a water-stressed region of Colombia that requires less water per wash than normal soaps.<\/p>\n

Pressure to find answers to these value chain challenges is set to increase, says Mike Tuffrey, director at UK consultancy Corporate Citizenship. \u201cJust as carbon footprinting is now routinely expected, so water footprinting will be soon \u2013 for practical operational reasons as well as those of sustainability,\u201d he predicts.<\/p>\n

Acting locally<\/strong><\/p>\n

The management ditty \u201cthinking global, acting local\u201d has a slightly hackneyed feel to it these days. But the mantra that helped companies grapple with the challenges of the globalised age is doubly relevant in the case of water.<\/p>\n

Water availability, not water scarcity, is the essence of the world\u2019s water dilemma. Some areas of the world actually have too much water. Collectively, the countries of Brazil, Russia, China, Canada, Indonesia, the US, India, Colombia and the Democratic Republic of Congo have 60% of the planet\u2019s available fresh water.<\/p>\n

Versatility is therefore critical to any corporate water strategy. Funding flood barriers might be appropriate in one operating environment, while constructing pumping stations could be the answer in another.<\/p>\n

\u201cWater is an issue of global concern, but of local management,\u201d says Andy Wales, corporate affairs manager for the brewer SAB Miller. \u201cWe are therefore trying to equip all our operations around the world to understand water risks at a local level.\u201d<\/p>\n

Yet that is only the start of the solution. As those who live on the banks of the Aral Sea will point out, local mapmakers are all well and good, but it\u2019s how local problem solvers respond to such maps that counts.<\/p>\n

Nestl\u00e9\u2019s water strategy<\/strong><\/p>\n

\u00b7\tWork to continue reducing the amount of water used per kilogram of food and drink produced.<\/p>\n

\u00b7\tAssure that activities respect local water resources.<\/p>\n

\u00b7\tTake care that water discharged into the environment is clean.<\/p>\n

\u00b7\tEngage with agricultural suppliers to promote water conservation among farmers.<\/p>\n

\u00b7\tReach out to others to collaborate on water conservation and access, with a particular focus on women and children.<\/p>\n

Corporate conservation<\/strong><\/p>\n

SABMiller<\/strong><\/p>\n

Brewer SABMiller<\/strong> is working with the US environment group Nature Conservancy to establish a \u201cwater fund\u201d in Bogot\u00e1, Colombia. Because of problems of sedimentation, the cost of water is three times higher in the capital city than in the rest of the country. The fund is supporting reforestation programmes and improving agricultural management in the catchment area. This reduces soil erosion and sedimentation.<\/p>\n

Globally, SABMiller\u2019s comprehensive water efficiency programme has enabled it to reduce its water consumption from 11 litres of water per litre of beer to 4.6 litres, the lowest in the brewing industry.<\/p>\n

Coca-Cola<\/strong><\/p>\n

Coca-Cola<\/strong> committed $20m in 2007 to help conserve seven of the world\u2019s largest freshwater river basins. The initiative, run in conjunction with environment group WWF, is part of the drinks company\u2019s global effort to become water neutral. In 2006, Coca-Cola used 290bn litres of water. It aims to recycle all water used in its manufacturing processes by 2010.<\/p>\n

Dole<\/strong><\/p>\n

US fruit company Dole<\/strong> has introduced irrigation systems fed with water recycled from packaging processes. The move has enabled it to reduce water use by 95% on banana plantations in the Philippines.<\/p>\n

Intel<\/strong><\/p>\n

Computer chip manufacturer Intel<\/strong> reclaims more than 3bn gallons of water a year by collecting and recycling wastewater, solid waste and chemical waste. Each of its new manufacturing facilities is equipped with a wastewater collection system with a separate drain system for collecting lightly contaminated water. The recycled water is then used in its facility equipment, such as cooling towers and scrubbers.<\/p>\n

Rio Tinto<\/strong><\/p>\n

Australian miner Rio Tinto<\/strong> has developed a diagnostic tool to assess performance and risk across all water management aspects within its operations. The process, which covers initial exploration through to closure, provides management with an action plan to improve performance at each of its operations. Rio Tinto has appointed \u201cwater champions\u201d at many of its sites to promote water improvement activities.<\/p>\n

Water and ecosystems<\/strong><\/p>\n

\u00b7 60% of the world\u2019s 227 largest rivers are severely fragmented by dams, diversions and canals, leading to the degradation of ecosystems.<\/p>\n

\u00b7\t50% of the world\u2019s wetlands have been lost since 1900.<\/p>\n

\u00b7 Just five out of 55 rivers in Europe are considered pristine, and only the upper sections of the 14 largest rivers retain \u201cgood ecological status\u201d.<\/p>\n

\u00b7\tIn Asia, all rivers running through cities are badly polluted.<\/p>\n

Source: Unesco<\/em><\/p>\n

Water and industry<\/strong><\/p>\n

\u00b7 Global water withdrawals for industry accounted for 22% of total global water use. The figure hits 59% in the case of high-income countries, but is only 8% in low-income countries.<\/p>\n

\u00b7\tThe annual water volume used by industry will rise from 752tn litres in 1995 to an estimated 1,170tn litres in 2025.<\/p>\n

\u00b7\tIn 2025, the industrial component is expected to represent about 24% of total fresh water withdrawal.<\/p>\n

\u00b7 In developing countries, 70% of industrial wastes are dumped untreated into waters where they pollute the usable water supply.<\/p>\n

Source: Unesco<\/em><\/p>\n

Water scarcity<\/strong><\/p>\n

\u00b7\tOf all water on the planet, 97.5% is salt water. Of the remaining 2.5% fresh water, some 70% is frozen in the polar ice caps.<\/p>\n

\u00b7\tLess than 1% of the world\u2019s fresh water (or about 0.007% of all water on earth) is readily accessible for direct human uses.<\/p>\n

\u00b7\tAbout 1.4 billion people, mostly impoverished, live in river basins where all water is already committed or overcommitted.<\/p>\n

\u00b7\tBy 2075, the number of people in regions with chronic water shortage is estimated to be between three and seven billion.<\/p>\n

Source: Water Partners International\/Stockholm International Water Institute<\/em><\/p>\n

What is water stress?<\/strong><\/p>\n

Water stress occurs when the demand for water exceeds the available amount<\/strong> during a certain period or when poor quality restricts its use.
\nWater stress causes deterioration of fresh water resources in terms of quantity (aquifer over-exploitation, dry rivers, etc) and quality (eutrophication, organic matter pollution, saline intrusion, etc).<\/p>\n

Source: UN Environment Programme<\/em><\/p>\n

Useful links:<\/strong><\/p>\n

WBCSD Global Water Tool<\/a>
\nStockholm International Water Institute<\/a>
\nInternational Water Management Institute<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Water resources: Efficiency and conservation \u2013 Swimming in dwindling waters As the planet\u2019s once plentiful blue resource gets used up, companies are acting to secure supply and be more efficient users of water by Oliver Balch, Ethical Corp Kazakhstan\u2019s mapmakers have their work cut out. No sooner do they chart the boundaries of the Aral …
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