The report highlights the role of climate change, human use of water systems and the over-exploitation of fish stocks on the state of our water environment.
The news is sobering.
The water cycle is being affected by long-term changes in climate including the melting of sea and land ice, changes in ocean salinity, sea levels, rainfall patterns and extreme weather events.
Coastal ecosystems are being impacted by urbanisation and tourism development. Water quality degradation continues to harm ecosystem health and is the single greatest cause of human illness and death. Degradation of aquatic ecosystems, habitat changes and over fishing are all placing pressure on biodiversity and food supplies.
Present trends will see 1.8 billion people living in areas with absolute water scarcity by 2025 and two-thirds of the world’s population could be subject to water stress. Considering that 70% of current water usage is directed to agriculture these trends are alarming.
The report calls for concerted global action to address the root causes of these issues combined with local efforts to reduce vulnerability.1
Increasing incorporation into capital markets
Findings like these are increasingly being recognised by the world’s financial markets. A number of leading investment houses, including Citigroup, have released reports assessing the impacts of climate change and water shortages on various sectors of the economy.
Given the findings of GEO-4 it comes as little surprise that water utilities have the greatest exposure. See our case study on how Manila Water is tackling these difficulties. In addition, sectors such as manufacturing and food and beverage face significant risks.2
Water is used in the production process for most of the items we use. Manufacturers compete with local water supplies and can often contribute to water degradation.
Global technology company, Intel, uses significant amounts of water in its semiconductor fabrication and assembly facilities around the world. Silicon wafers need to be cleaned during fabrication and packaging using ultra pure water.
Its facilities compete for water resources with local drinking and sanitation supplies, ecosystem protection and other industries, like agriculture. The company has modified its plants to suit local conditions and reduce demands on local water supply.
At one site it has increased water purification efficiency allowing it to reduce over 50% of its freshwater needs through water reuse. At another, process water is sent to a treatment plant maintained by the local government resulting in the injection of nearly 1.5 million gallons of water each day into the city’s underground aquifier.3
There are already examples of organisations that have benefited from reducing water pollution. Dupont has modified nylon production processes at its Texan plant to recover and reuse over 250,000 pounds of material formerly lost to wastewater streams each day. Seventy-five per cent is sold to customers or recycled as catalyst and raw material with the remainder used as fuel offsetting natural gas use at the plant. The remaining wastewater is treated at an on-site biological facility and is released into constructed wetlands before returning to the local river system.
Prior to this, DuPont was discharging wastewater via a deep well injection method and risked increased regulation and community concern over this method.4
But you don’t need to be a large company to undertake this kind of approach. Swansea based hand car wash centre, Pittstop has successfully implemented a closed loop water recycling system. The system includes a reed-bed that cleans the water by removing suspended solids. The technology was easy to install making it ideal for small business.
Pittstop’s use of mains water supply has reduced by more than 60%. With water representing 85% of Pittstop’s consumable costs the system will easily pay for itself within just four years. In addition, the company has introduced biodegradable cleaning products and promotion of its activities has resulted in a 16% increase in business.5
In the food and beverage area the Coca Cola Company is currently experiencing significant growth in Africa, one of the driest continents on earth. This follows very public and potentially brand damaging concerns over the company’s water use in drought-prone areas of India.6
This year CEO E Neville Isdell pledged a goal “to replace every drop of water we use in our beverages and production”. Already the company has reported overall water efficiency improvements of 18.6%.
It has also formed a partnership with the World Wildlife Fund for Nature (WWF) to conserve and protect freshwater resources including seven of the world’s most important freshwater basins. These include China’s Yangstze, South-east Asia’s Mekong, East Africa’s basin of Lake Malawi and Europe’s Danube River.7
Development of new markets
Along with the benefits of mitigating risks there are new markets and technologies developing that provide significant opportunities. Again it is not always large firms that are taking the most advantage of these opportunities.
Water is increasingly appearing as a renewable energy solution. Hydro electricity is one of the earliest commercial scale forms of renewable energy. See this edition’s case study on EDF to see how it continues to be applied. Newer forms including wave energy are also yielding dividends, including for the Scottish based Ocean Power Delivery, formed with the backing of venture capital. It is currently trialling its wave energy system in Portugal. It is estimated that the total Scottish renewable energy sector could create up to 7,000 jobs.8
Belgian based Ecover has built an international business out of manufacturing ecological detergents and cleansing agents. The business has since expanded into the professional cleaning sector and developed a personal cleaning line.9
By developing its products from natural ingredients they can be stored in water tanks, another booming water-related business, and are suitable for re-use on household gardens.
For a further example of market innovation read our case study on Belu natural mineral water and how it became the first bottled water company to not contribute to climate change.
Green water – our hidden consumption
Much of the water risk for organisations is related to green water. Similar in concept to the idea of embodied energy, green water refers to the water consumed in production.10 As we have already seen from previous examples this can be substantial.
A simple example is the textile industry. In 2004, the UK’s textile industry used 90 million tonnes of water, half a percent of total water consumption for the year.
Water is used in growing natural fibres, for instance the irrigation for cotton crops or raising of sheep to produce wool. Actual water consumption for cotton can be 7,000 to 29,000 litres per kilogram of cotton fibre.
Water is again used in the production and dyeing process. This results in the release of chemicals in the form of wastewater especially in pre-treatment, dyeing, finishing and laundry all of which have the potential to harm wildlife in these waterways. Each kilogram of fabric uses approximately 60 kilograms of water in its creation. A further 45 kilograms of wastewater is discharged, with the difference lost to evaporation.11
Finally, once it has been purchased it will need repeated washing, again adding to the associated water consumption. In recognition of this Unilever has launched Surf Exel to the Indian market and increased sales by 50%. It produces less lather and therefore requires less rinsing saving up to two buckets of water.12
This idea is explored further in our briefing paper which explores the impacts of trading green water between international markets and the idea that developing countries could be exporting vital water supply at the expense of the wellbeing of their population.
Where to start?
With the evidence presented by GEO-4 it is clear that it is important that we act now. But just how should organisations go about it?
The Global Environmental Management Initiative (GEMI), a non-profit organisation, has developed a Water Sustainability Tool to help organisations understand the impact of emerging water issues and build a business water strategy. The tool encourages organisations to:
- Conduct a systematic assessment of their relationship to water
- Identify specific opportunities and risks associated with this relationship
- Assess the business case for action
- Tailor a water strategy that addresses the organisation’s specific needs and circumstances
- Ensure the tracking of water-related risks and opportunities using a framework for continual improvement.
This is achieved using five analytical stages or modules:
- Water use, impact and source assessment
- Business risk assessment
- Business opportunity assessment
- Strategic direction and goal setting
- Strategy development and implementation.
In addition, the tool provides useful tips on how to promote a greater understanding of water issues within your organisation including suggestions for some of the more difficult conversations when dealing with sceptics.13
The World Business Council for Sustainable Development (WBCSD) also launched the Global Water Tool in 2007. The tool helps organisations map their water use and assess risks relative to their global operation and supply chain.
The tool highlights important questions like “How many of your sites are in extremely water scarce areas? How will that look in the future? How many of your employees live in countries that lack access to improved water and sanitation? How many of your suppliers are in water scarce areas now? How many will be in 2025?”
The tool consists of an Excel workbook and an online mapping tool supported by a video tutorial. It:
- Compares your organisation’s water uses with validated water and sanitation availability information
- Allows calculation of water consumption and efficiency
- Establishes your relative water risks to help you prioritise action
- Creates key water GRI indicators, inventories, risk and performance metrics and geographic mapping
- Enables effective communication with internal and external stakeholders on your water issues
See also our briefing paper on the CEO’s Water Mandate for further information on managing water issues.14
As pointed out by Sustainable Development International there are alternative sources of energy but there are no alternatives to water.15 It is vital that we take heed of the scientific trends and incorporate water issues into risk and other management frameworks.
- Global Environmental Outlook 4: environment for development, UNEP
- Half full or half empty?, UNEPFI
- Connecting the Drops Toward Creative Water Strategies: A Water Sustainability Tool, GEMI
- Connecting the Drops Toward Creative Water Strategies: A Water Sustainability Tool
- Celebrating your success: The Environment Agency Water Efficiency Awards 2007, Environment Agency (Supported by Defra)
- In hot water, The Economist, 6 October 2005
- WWF and Coca-Cola announce partnership to conserve freshwater resources, WWF, 5 June 2007
- Wave energy test centre launched, BBC, 10 August 2004
- Ecover website
- Business in the world of water: WBCSD Water Scenarios to 2025, WBCSD, August 2006
- Well dressed? The present and future sustainability of clothing and textiles in the United Kingdom, University of Cambridge Institute for Marketing, 2006
- Unilever website
- Connecting the Drops Toward Creative Water Strategies: A Water Sustainability Tool
- WBCSD website
- Business in the world of water: WBCSD Water Scenarios to 2025
Also in this feature:
© Article 13 – January 2008