As we've written about many times here at GreenBiz.com, water can be one of the most complex challenges companies face. Heavily dependent on locale, managing water risks effectively requires the collective cooperation of many players, including businesses, communities and NGOs.
With an eye on the creating a critical mass of multi-stakeholder engagement on water, SABMiller, WWF and the German International development agency (GIZ) are imploring other companies and NGOs to participate in the Water Futures Partnership, which they created in 2009 to show the business case for the private sector to promote sustainable water resources management.
SABMiller, of course, is significantly dependent on water to produce a portfolio of beers that includes Miller Genuine Draft, Pilsner Urquell and Grolsch, among others. Water scarcity in the regions where it operates spells business risk for the beverage giant.
The partners released a report [PDF] Wednesday outlining their work identifying and addressing these business risks in watersheds in South Africa, Peru, Tanzania and Ukraine. Their efforts revealed a supply chain exposed to competition for water resources, poor municipal sewage infrastructure, and vulnerabilities related to growing of agricultural products, such as hops.
A couple interesting tidbits from the report:
• More than 90 percent of the net water footprint of SABMiller's operations in Peru, South Africa, Tanzania and Ukraine can be attributed to crop cultivation, followed by brewing and bottling, which accounts for 9 percent.
• The partnership will collaborate in Dar es Salaam, Tanzania, with Coca-Cola Sabco, with whom it shares like interests. The country's water risks not only threaten the two companies' operations, but more broadly will impact the nation's economy, citizens' health and aquatic ecosystems.
• Wastewater discharge, not water scarcity, is the biggest threat to SABMiller's Donetsk Brewery, in terms of operations and reputation. The plant's treated wastewater is discharged into a municipal water pipe that is in poor condition and sometimes fractures, requiring the brewery to reduce production. The Water Futures Partnership will work with the local municipal water service provider to rehabilitate the pipe.
The move echoes another like-minded effort from PepsiCo, which last week unveiled its own work analyzing five watersheds in which it operates. Like SAB Miller, PepsiCo turned to the help of an NGO with a long history in water issues, The Nature Conservancy. The work will inform a future PepsiCo toolkit that may be used across the company's 700-plus facilities.
The Water Futures Partnership performed Watershed Risk and Sustainability Assessments in the four countries, which covered the current state of the watershed, business and ecosystem risks, and the potential impact from climate and social change. This was followed by a Business Water Risk Assessment to calculate the costs of risks to SABMIller's business.
Both served as the first stage of the development of a business case. The second phase involves the creation of multi-stakeholder partnerships to mitigate shared water risks. Ultimately, the group would like to expand in order to bring other stakeholders into the fold.
"The long-term goals in water-stressed regions are for SABMiller subsidiaries and other collaborating companies/organizations to be collectively engaged in spreading good practice on water use, supporting community access to water, improving water services provided by ecosystems, and supporting good water governance and the public sector in their role as water managers," the report said. "This, in turn, will lead to the private sector having increased confidence in the ability to continue to operate without water becoming a strategic risk to their investments."
Image CC licensed by Flickr user markhealey.