ILG: Healthy Ecosystems
Impact Category: Processes
14 min Read Time | November 9th 2022
When surface water is unavailable, groundwater is used. Sustained pumping of the latter can lead to depletion and water quality concerns.
In your analysis, it is important to assess what bodies of water companies are extracting their water from, and where (if they are in very high or high water-stressed regions).Make sure to include the amount of water recycled or reused, if any.
Report the total water extracted and consumed by the company. Reducing or mitigating water use year-on-year is positive, but only relevant given the context: how much does the company still use despite reductions, recycling and reuse rates?
Water is a valuable resource for both humans and ecological systems.
Groundwater is extracted where surface water, including streams, reservoirs, lakes, and other water bodies are scarce or inaccessible. Indeed, groundwater can help meet hydrological needs; for example, in the US, groundwater meets half of the country’s total population water drinking needs, but at a cost. In the long term, its levels have been declining from continuous pumping, resulting in depletion.
Lowering of the water table is not the sole impact. Sustained groundwater extraction also leads to decreased water quality, causing contamination by salt water.
Water stress can be defined as “the ratio of freshwater withdrawn to total renewable freshwater resources”. In 2017, Central and Southern Asia and Northern Africa suffered from very high water stress of over 70%. In the same year, Western and Eastern Asia registered high water stress of 54% and 46%.
As of 2018, freshwater bodies covered 2.1% of the land, but they are unevenly distributed worldwide. The distribution ranges from 3.5% in developed nations, 1.4% in developing countries, 1.2% in the least developed nations, and 1% in small island developing states. These percentages are expected to decrease as climate change continues, further exacerbating water scarcity and affecting ecosystems and livelihoods.
Found more information about this issue on the United States Geological Survey website and the Groundwater Foundation website.
Water Withdrawn is defined as: “the total amount of water withdrawn from a surface water or groundwater source. Measurements of this withdrawn water help evaluate demands from domestic, industrial and agricultural users.”
Water Consumption is defined as: “the portion of the withdrawn water permanently lost from its source. This water is no longer available because it evaporated, got transpired or used by plants, or was consumed by people or livestock.”
ILG: Healthy Ecosystems
Impact Category: Processes
Depending on what is available, the analysis should provide the following:
In your analysis, you must look at the company’s overall water consumption. Most companies now report this information in their CSR/Sustainability annual report or public CDP Report.
You should also assess the water-stress risk of the locations where the company has its operations.
Regarding this, we can have different scenarios:
To assess the water stress of our companies, we are using the Water Risk Indicator (WRI) Aqueduct online interactive map.
You can launch the online map to pinpoint your locations on the map and find out about the water stress levels. You can search by baseline water stress, drought risk, and riverine flood risk for greater granularity.
Caution: Data about the pinpointed locations on the map must be visible once the source is used in the analysis so that upon opening the source, readers will be able to easily verify.
In case the "Enter the address" function does not work, please follow the below:
Caution: We encourage the use of the second and third approaches. We only accept country-based water stress assessments when location-specific data is nowhere to be found.
To find the company's withdrawal in water stress areas, you can consult:
Additionally, we are allowing the use of this source to help you out on water-stress assessments as the data is from the WRI (the same provider of the interactive AQUEDUCT tool and is based on the same data set). However, this will be allowed only for country-based assessments, whenever there are several locations of a company or data for the specific locations are nowhere to be found. Please do not use water-stress data for a country if location-specific information can be found.
We would not want you to check many locations for a water-stress analysis. In such cases where the company has many global operations, you can either provide the data only for main operational locations or country-wise data.
Additionally, if the company has disclosed the % of water withdrawn or consumed from water-stressed areas, then we only ask for a water-stress analysis because with the provided information we cannot assess whether it has operations in high, medium, and low water-risk areas or not - which are among the data points for this topic. However, when the company describes water-stress locations or water coming from these areas by mentioning % in high, medium, and low, we do accept it as such.
Regarding your message Kanak, you have a valid point as this is about the company's offices and not necessarily where they extract the water. We have always been aware of this but know that it would be much more time-consuming to look into all of this information. This is why for manufacturing companies, we ask you to provide the water stress analysis based on manufacturing and R&D locations, whenever it is disclosed (most of the time these are disclosed).
For other companies (retailers, and those that only provide services) we accept it based on office locations as they consume water in those operations only. Still, we require the water stress levels and not general statements, or else we would not be able to extract low, medium, and high data. What you can do to prevent erroneous data, in this case, is to simply claim in the analysis that the data extracted for the water stress levels are estimated and partial. This can be mentioned unless the company provides the total exact locations of all of its manufacturing sites.
You may mention the water efficiency/reduction initiative the company has put in place. However, this should be secondary to the company’s current impact (i.e., total water consumed, where in the world, and the percentage of recycled water). Your analysis should not be based on the company’s remediation efforts. To fully understand how to move away from remediation, you should read the dedicated article: Golden Rule 5: Go beyond remediation.
Water Withdrawn can also be referred to as:
*Unless otherwise stated in the report of reference.
As Water Withdrawn is the amount abstracted from the environment and Water Consumption is the amount lost due to industrial processes (not returned to the source), we can estimate that:
WATER CONSUMPTION = WATER WITHDRAWN - WATER DISCHARGED
The above formula is oftentimes used by CDP. Thus, if we have the values of Wastewater/Water Discharge, and the Withdrawn amount, we can estimate* Water Consumption.
Similarly, we can estimate* the amount of Water Withdrawn if we have the values of Wastewater/Water Discharge, and Water Consumed.
*Please make sure the analysis mentions that this is an estimate
Note: Do not use water withdrawn and Water Consumption interchangeably as they are not the same in most cases
In your analysis, make sure you add value to your readers and go beyond the company’s CSR report by not merely reporting data from the company’s report, but going the extra mile of providing additional data, studies, and sources to make your analysis robust and the impact value and scale are clear.
We want to have homogenous and comparable units. Therefore, we will accept values expressed in cubic meters (m3).
EXTERNAL DATA FROM THIRD PARTY:
To find out if there is water related data that is not directly disclosed by the company, always consult the CDP website. Cross-checking with CDP will clear any doubts you may have regarding the terminology and figures reported by the company.
Caution: If you use CDP, make sure the year of reference is the latest and matching the one from the report you want to verify or complement data with. This info is in the first page of every CDP report.
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