No matter the place — California’s Central Valley, southern Nevada, the Colorado River, the Southern Plains — water is harder to find across much of the West. And, with energy demand and populations growing, once-unfathomable choices about water pricing and the future of agriculture are unavoidable.
Water has been on the sustainability agenda for many years, but this article brings in to stark focus the reality of declining availability of fresh water in North America.
It raises the question, could water shortages prove a risk to your businesses, either in their operations or supply chain? Reducing water consumption is not just an environmental issue, it is a real and present business issue.
Think about the following questions.
Physical risk: is there a possibility of a freshwater shortage in your supply chain or own operations?
Reputational risk: can you answer questions from the public about whether the company is addressing sustainable and equitable water use?
Regulatory risk: would any increases in governmental interference and regulation about water use affect you?
Financial risk: could any of the above translate into increased costs and/or reduced revenues?
Reducing the water footprint in your supply chain should be part of any sustainability strategy, just like reducing the carbon footprint. In fact, it may move higher up the agenda as impacts of freshwater scarcity and pollution will be more obvious in the short term and therefore more liable to tougher regulation.
As with carbon emissions, when companies start looking into their supply-chain water footprint, many will discover that it is much larger than their operational water footprint. As a result, it may be more cost effective to shift investments from efforts to reduce their operational water use to efforts to reduce their supply-chain water exposure and the associated risks.
Try to find details on where and when water is used in your supply chain. This information can be used as input to a detailed water footprint sustainability assessment, to identify the environmental, social and economic impacts and to find out associated business risks. Don’t just look at water withdrawals however. Return flows can be reused, so it makes sense to also look at consumptive use – non-returnable use.
Also, be aware that meeting grey water emission standards is not always the whole story. Looking at how effluents actually result in reduced assimilation capacity of ambient freshwater bodies and at business risks associated to that gives a fuller picture.
Setting targets, benchmarking, certification and water footprint reporting are all steps that will help manage your water footprint – exactly as you would manage your carbon footprint. And also just like carbon emissions your company can cut its supply-chain water footprint through better communication and engagement with your existing and potential suppliers.
President, Virescent Consultants Ltd