By Jason Morrison, Corporate Sustainability Program Director
The answer is an emphatic, YES! In fact, given that the private sector accounts for the majority of global water use (when including both industrial water use and companies’ agriculture-based supply chains), one could argue that achieving such goals without direct business involvement and support will be near impossible. The good news is that many in the business community share an interest in achieving more sustainable water management, as there’s a growing understanding within companies that such an outcome is perhaps the most viable long-term strategy for addressing water-related business risk.
And to the degree to which a comprehensive goal for water will be included in the post-2015 development agenda, this broadened perspective on water will resonate deeply with many private sector companies. Looking backward at the Millennium Developments Goals, the focus for water was on access and sanitation to meet basic human needs, a topic one could argue that is only tangentially related to direct business interests. Yet the current UN-led global consultation on water in the post-2015 world has expanded beyond setting policy objectives relating to access to safe drinking water, sanitation, and hygiene (WASH), and to include objectives relating to water resources management and wastewater and water quality more generally. Inherently, achieving targets associated with these latter two aspects of water will require engagement of, and collaboration among, all segments of society.
This was one of the many conclusions of a day-long conference organized by the CEO Water Mandate in Mumbai, India in March of this year to explore specifically the role of business in advancing potential global policy objectives relating to increased access to WASH services, improved water resources management and governance, efficient water use, and pollution reduction.
However, to look to 2015 and beyond, one must understand why and how businesses are seeking to collaborate with others to address water challenges presently. Shedding light on today’s situation illuminates why and how companies will prove a key asset in cooperative efforts to advance the post-2015 development agenda.
Companies are increasingly recognizing the global water crisis is a business issue, and they’re ready to act – in fact, they’re already taking action, often in collaboration with other stakeholders. This awareness has been growing over the last decade as water scarcity has become more pronounced in many parts of the world. For the last two years, water has been in the top five societal risks identified in the World Economic Forum’s annual Global Risks Report (for both probability and severity). This means that mainstream CEOs in many industry sectors are recognizing that water represents a material risk to their companies; it’s not a perspective held solely by a handful of progressive chief executives or by mid-level sustainability personnel at global and medium-sized companies.
Often, the greatest water risks come from conditions over which companies have the least influence. As a case in point, even an ultra-efficient factory in a location where the water management system is dysfunctional is still facing water risk. This reality has caused companies to look outside their factory fenceline for solutions. And, in fact, a strong business case (measured in return on investment) is emerging for engaging with external actors and partnering on water issues.
However, businesses are not the only actors that face water risk. A dysfunctional, unsustainably managed water system poses risks across segments of society – governments, civil society groups, impoverished communities, etc. are all threatened by unsustainable water management in distinct but related ways. Thus shared water risk creates a strong motivation for collective action among companies and others to improve water management.
After considering the needs and interests of other partners, a growing number of companies are subscribing to the proposition that over the long-term, sustainable water management represents the most viable water risk mitigation strategy. Within the context of deliberations relating to the post-2015 development agenda, the notion of water security has perhaps the strongest alignment with the business case for action. Water security, similar with the concept of sustainable development, is a broad term that means many things to many people. However, a fundamental component of water security is the notion that long term demand must come into balance with reliable, renewable supply. Such a balance is integral to long-term business viability, making the business case for action fairly compelling. With water security as the umbrella, WASH-related targets serve to address equitable distribution of supply among societal uses, and participatory water governance structures become the enabling mechanisms that ensure all voices are heard in democratic decision making. Water efficiency targets and targets around treating and/or reusing municipal and industrial wastewater are all in essence about addressing either the supply or demand side of the water balance equation (or both).
The good news is that companies and other actors don’t need to await the outcomes of the next two years of intergovernmental policy negotiations to learn how water challenges will be tackled in the post-2015 development agenda. Enabling platforms that facilitate cross-sectoral collaboration on water already exist. The CEO Water Mandate’s Water Action Hub is an online tool that allows companies and other stakeholders to efficiently find other actors that share an interest in addressing a particular water challenge at either a global level or in a particular geography of shared interest. I am highly confident that most if not all twelve of the action areas the Hub uses to coordinate collaboration among stakeholders will be highly relevant to whatever emerges out of the political negotiations relating to our global goals for water in the post-2015 world.
Pacific Institute Insights is the staff blog of the Pacific Institute, one of the world’s leading nonprofit research groups on sustainable and equitable management of natural resources. For more about what we do, click here. The views and opinions expressed in these blogs are those of the authors and do not necessarily reflect an official policy or position of the Pacific Institute.