Global corporations fret about their water supplies

June 6, 2014
Businesses, by nature, manage risk, and a long-term supply of water is one of those risks. The coal industry has done little to address its water use, especially in China. Many governments are no longer able to pay for infrastructure investments.

Erratic weather all over the world has multinational corporations in a variety of industries — mining, industrial, energy, beverages and food — worrying about a stable, long-term supply of water. Even if enough water is available, they are concerned that local governments might not grant them a continuation of their water rights. The first companies to be affected have been food and beverage companies that use irrigation-dependent agricultural products.

Writing in the New York Times, Beth Gardiner notes that water supply problems are growing because of climate change, population growth, and the movement of more people into cities.

The World Economic Forum, in its annual report on global risks, published in January, ranked water crises as the third-biggest risk to stability in the decade ahead, behind fiscal crises and unemployment. Without changes in business practices, the demand for fresh water could be 40 percent higher than supply by 2030, according to the 2030 Water Resource Group, a public-private consortium that is housed within the World Bank’s International Finance Corp.

The Alliance for Water Stewardship, backed by environmental groups and multinationals such as Nestle, has written guidelines that companies can use to assess their water risk.

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