All Food Companies Need To Focus On Water Risk Management

(3BL Media/Justmeans) Water scarcity is a big problem for food production. Agriculture is the biggest water user on the planet, accounting for about 70 percent of global water withdrawals. About 40 percent of the global food supply is grown in irrigated areas, while 80 percent of the world’s cropland relies on rainfall for irrigation. Climate change can cause rainfall to vary. Nearly all of the major breadbaskets in the world, including the U.S., are in regions where crop irrigation is dependent on aquifers that are being severely depleted.

Water is one of the food industry’s biggest risks, made worse by climate change. A total of $$459.2 billion in revenue is at risk from lack of water for irrigation or animal consumption, and $198.2 billion is at risk from changing rainfall patterns affecting crop production areas. Food companies are realizing the risks they face. A recent report by Ceres found a 10 percent improvement in the average score of the food sector’s management of water risk since 2015. Ceres ranked the 42 largest global food and beverage companies on how they deal with water risks.

“Smart water management is a business imperative for food companies, as the impacts of climate change and water scarcity and pollution accelerate around the world,” said Brooke Barton, senior director of water and food at Ceres, who co-authored the report.

Nestlé had the highest score of 82, out of 100, among the companies ranked by Ceres. In 2015, the first year Ceres ranked companies, Nestlé had a score of 64. The company has implemented programs to reduce water withdrawal, reuse water and use alternative sources, such as rainwater. Water withdrawal per ton of product has been reduced by 25 percent since 2010. The company is currently conducting 516 water saving projects at its factories, which will save 3.7 million cubic meters of water annually. That amount of water is equivalent to 1,500 Olympic-size swimming pools.

Some of the areas showing most improvement since 2015 in the rankings are business strategy, setting water targets, water accounting, risk assessment and sustainable sourcing programs. General Mills is one of the companies that made the greatest progress in these areas. In 2016, the global food giant updated its risk assessment of the watersheds that support its business globally. It assessed 15 key ingredients in 36 sourcing regions and 66 facilities covering 41 watersheds. As a result of the analysis, it identified eight priority watersheds to target across its global operations.

Wastewater discharge is an area that more companies need to focus on. Only five companies have set a company-wide goal to reduce overall effluent load. Coca-Cola is one of those companies. The beverage company set goal to require all of its plants to implement standards to treat and return the water used in the manufacturing process back to nature at a level that will support aquatic life. The goal drove its bottling plants to adopt processes and technologies to treat wastewater within the company’s facilities.

Companies like Nestlé, General Mills and Coca-Cola are showing other food and beverage companies how to best deal with water risks. While some companies are making progress, more need to take water risks seriously. As Barton said, “Some corporate leaders are making strong progress, but the majority must do more to water-proof their businesses to protect and sustain our water supplies.”

Photo: Coca Cola