Indispensability of water for industrial activity is well known. Neglect of water-related issues by the Corporate Sector can incur heavy losses to it and this revealed in a recently released report compiled by environmental non-profit CDP and released at the climate summit in Marrakech, Morocco. According to the report, droughts, water scarcity and stricter environmental regulations cost businesses a reported $14bn in the first three quarters of 2016, up from $2.6bn in 2015. The report laments that despite seven-fold increase in cost from water risks, companies still aren’t doing enough to protect themselves from water risks.
Undoubtedly, CDP approached more than 1,200 of the largest listed companies around the world in sectors exposed to water risk; nevertheless, just over 600 responded, which means that the $14bn figure is likely to be immensely underreported. It is revealed that more than 25 per cent of the companies said water-related issues, including floods and pollution, had affected their bottom line, typically due to higher operating costs and a disruption in production.
The Anglo American Platinum was reportedly spending millions of dollars on infrastructure at its Mogalakwena mine in South Africa to protect its water supply against shortages, including a $6m upgrade to a nearby sewage works. According to a media report, Morgan Gillespy, head of water at CDP, has said: “Every business in every sector needs water in some form or another…Addressing water risks is vital for business continuity, protecting the bottom-line and to enable an effective response to climate change.” And Gillespy’s advice needs to be seriously taken.
by Dr. Arvind Kumar, President, India Water Foundation
