Water rising up corporate agendas

Image: Jeremy Bezanger on Unsplash

Water and forests are rising up the agenda of some of the world’s biggest companies as more take action than ever before. That is the finding of CDP, a not-for-profit that runs a global environmental disclosure system for companies, cities, states and regions.

Some 12,000 companies are ranked A-D on CDP’s annual list, which was released in December 2021 and shows levels of transparency and performance on water security, forests and climate change. Some 272 companies worldwide have been named for their leadership and A-listers in water security include household names like Diageo, Heineken, J Sainsbury, AstraZeneca, Colgate Palmolive and Lenovo.

Industry and commerce requires huge volumes of water to produce the goods and services required by populations around the world, from food and drink to tech and pharmaceuticals. CDP says companies gradually seem to be recognising that environmental issues are interconnected and must be managed together, which includes adopting a more holistic approach to environmental reporting.

Fourteen companies – including L'Oréal, Unilever, HP and Lenzing AG - achieved a triple A for their performance on all three environmental themes in 2021, an improvement on last year’s record of ten. The number of companies on CDP’s water A-list grew from 106 in 2020 to 118 in 2021, although the number on the climate A-list dropped from 280 to 200 as the consensus on what qualifies as climate leadership evolved and the bar raised.

CDP says much of the low-hanging fruit has now been reaped and more ambitious action is urgently required from companies. The positive leadership of the most pioneering companies represents just 2% of all scored companies making the A-list, with 58% scoring between C and D, which means they are only just beginning to recognise their environmental impact.

"Scrutiny is rising - empty targets or greenwash simply won’t fly.”

Dexter Galvin, CDP

“COP26 highlighted the necessary role corporates play in driving the real economy changes to tackle the climate and ecological emergency, and keep us within 1.5°C,” said Dexter Galvin of CDP. “It is fantastic that more businesses are disclosing their impact every year and recognising the interconnectedness of environmental issues.

“We now need to see even more ambitious action on climate, and more businesses stepping up on other areas of natural capital. Seventeen thousand corporates failing to even take the first step and report their environmental data is far too many.

“These companies are not only putting the planet at risk, but themselves. If they continue with business as usual, they will end up on the wrong side of public opinion, regulation and investor sentiment. And scrutiny is rising - empty targets or greenwash simply won’t fly.”

Water action from companies on the A-list included efforts from IT company Fujitsu, which is working with clients in Asia to find solutions for areas experiencing water issues; and fiberglass manufacturer Owens Corning, which has introduced performance indicators to reduce water withdrawals and consumption and improve efficiency across direct operations.