Sustainable business consortium, Ceres, published a report last week investigating the global food sector’s management of water scarcity risk. The report, entitled Feeding Ourselves Thirsty: How the Food Sector is Managing Global Water Risks, reveals that many agriculture, food and beverage companies are not making water risk a part of their decision making process.
Water scarcity is a rapidly growing problem in many parts of the world. It is especially critical for the food industry. Agriculture accounts for 70% of water use worldwide. As groundwater in many regions runs low and climate change exacerbates the issue, this industry in particular is at risk.
The Ceres report ranked the largest corporations in the industry on their water risk management systems. It found that beverage and packaged food companies are on average more mature in their assessment of, and action to mitigate, water risk than meat and agriculture corporations. However, in each of these four sectors there is a large disparity between the best and worst performers. While leaders like Unilever, Coca-Cola and Nestlé, obtained a score of above 60/100 on the rankings, a number of corporations ranked as low as below 10. Overall, water risk was seriously considered in business planning by only 30% of companies in the study.
As the global water scarcity problem grows, more companies in the food industry will likely begin to make water risk management a major part of their strategy. As the report states, it will be up to both investors and companies to “act to mitigate short-term risks and foster long-term solutions that ensure sustainable food and water supplies” in the coming years.