Sun, Sep 22, 2013 - Page 9 News List

Companies take on water risk

Businesses are becoming aware that floods and droughts pose risks to their profits

By Andrew Steer

Similarly, the beverage company SABMiller is targeting a 25 percent reduction in the water intensity of its beer production between 2008 and 2015, and is now enhancing its water resilience throughout its global operations. Through its Water Futures Partnership, the company has identified which of its facilities are located in areas facing water-security risks and has created partnerships in the local watersheds to address these risks.

The message is clear: water-risk management is shifting into the mainstream of business practices. More than 90 signatories of the UN Global Compact’s CEO Water Mandate have pledged to develop, implement and report on water-sustainability policies and practices in both their own and their suppliers’ operations, and to work with stakeholders beyond their own operations to address water risk. Leading companies are showing that sustainable water management benefits all involved.

While many executives have traditionally underappreciated the risks from climate change and resource degradation, understanding water risk — and acting to minimize it — is just one way that businesses are starting to incorporate natural-resource management into their core strategy and operations. Smart business leaders are investing in new tools that can provide comprehensive and up-to-date data, and companies are increasingly moving beyond recognition of natural risks to developing strategic responses to them.

As more companies do so, laggards will be at a growing competitive disadvantage. They, too, will have to act before the next flood or drought strikes.

Andrew Steer is president and chief executive of the World Resources Institute.

Copyright: Project Syndicate

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