If you were told that investment in a key input for business operations has been neglected for over forty years--and is increasingly in a state of disrepair--how would you react? What if that same input was also critical to the health and social well-being of you and your colleagues?
You would likely say nothing. You would be incredulous. Gob-smacked. How did this come to pass?
And yet, this is exactly the state of affairs with how we manage water--in the US as well as in many parts of the world.
For companies, this situation is a business risk. JPMorgan was clear on that point in a report issued eight years ago. The CEO Water Mandate is even more clear today.
If companies cannot access clean, reliable water, there will be problems--operational, product, and even employee and community health issues. Though the exact timing and precise locations of these problems may be hard to predict, it is clear that they issues will emerge in the coming years.
For governments, an over-extended and poorly functioning water system is also a risk that can lead to frustration and lack of political support (at best, with significantly more sobering worst case scenarios, such as civil unrest).
For communities and residents, inadequate access to water can lead to health and environmental problems--from sanitation through illness, as well as habitat degradation and species extinction.
Yet, investments in essential water infrastructure over the past few decades have been inadequate and frequently rely on strategies of the past.
As we look forward, we need to think about three key dimensions of the problem related to reliable access to safe water.
First, essential built (grey) water infrastructure is crumbling around the world. As with any built infrastructure, funds are needed to maintain and replace as needed. For water, the pipes, the water treatment facilities, and the numerous other 'grey infrastructure' is key to keeping water safe and moving to where it is needed. Yet, water infrastructure in US and other key parts of the world (e.g., Europe, Brazil, India, China, etc.) is in poor condition.
Second, the core ecological and hydrological systems that undergird the systems are being undercut, with the potential for "ecosystem malfunction risk"--due to deforestation, habitat conversion, and increasing paved (non-porous) surfaces. When intact, natural systems enable filling reservoirs, recharging groundwater, filtering out impurities from water that flows down streets and off parking lots--while concurrently holding soils in place, preventing erosion and mudslides, sequestering carbon, producing oxygen, and evaporating significant amounts of water into the air, which can become important rainfall in areas far away.
It is easy to fall into the skeptical role on whether these ecological and hydrological dynamics are really important. We live in an era of technological triumphalism. How is it that we still really rely on forests, trees and grasslands as essential infrastructure that needs to be maintained for water systems to function well? The idea sounds like a poorly conceived Hollywood blockbuster linking cities and nature.
Suspend skepticism for a moment and consider a simple question: How much water does a large expanse of forest evaporate and with what relevance to rainfall, water cycles, and refilling of urban water reservoirs?
The answer is so much water that Brazilian scientist, Antonio Nobre, refers to "flying rivers" above the Amazon rainforest--which have been essential to water access of people and businesses in the mega-city of Sao Paulo, many miles away. Specifically, Nobre has estimated that the Amazon rainforest evaporates ~20 billion tons, which is more than the total volume of water discharged daily (at a rate of 200,000 cubic metres per second) into the Atlantic by the Amazon River.
Deforesting the Amazon, therefore, affects how much water is in the air, which in turn affects how much water the winds can carry to cities and ultimately fall as rain into urban water reservoirs. Cut down the rainforest and diminish a key water source that has supplied Sao Paulo with water. Disrupt Sao Paulo, and reverberations will be felt throughout Brazil as well as Latin America and other parts of the world economy.
Given these linkages, all water users need to invest in well-functioning ecological systems and maintain the dynamics that contribute to flows and retention of water, across landscapes, into reservoirs, into groundwater and through the air. This set of dynamics means that investing in green infrastructure, in the form of reforestation, native grassland species, floodplain restoration, wetland restoration, and numerous other such ecological restoration projects are important to maintaining the (green) infrasturucture.
Third, and finally, there is today insufficient data and analytical infrastructure in which to make robust, well-informed water management decisions. Data is needed to answer questions such as: What is the amount of groundwater in a particular aquifer? Yet, answers to these questions and the data--by which businesses, residents and governments alike can assess and manage the water demand and supply situation--is still lacking in many ways.
The time for major investment in water is now. It is needed at the scale of the much more discussed (and also sorely needed) shift to low carbon energy sources. And, just as we need to address climate change drivers, so too is there a need to shift to a water-aware, water-efficient, water-smart economies.
Such a shift will require investing in the data and information with which to effectively manage water--within businesses, homes, water authorities, governments and across sectors--as well as investing in both the grey and green infrastructure that enable access to water and moving freshwater around, where we need to use it.
Business leaders increasingly acknowledge this multi-dimensional set of needs for water management, as is clear in guidance from the Beverage Industry Environment Roundtable (BIER) as well as projects of leading companies such as ABInBev, Coca-Cola, and numerous other companies. The CEO Water Mandate is providing guidance and the Alliance for Water Stewardship highlights pathways forward. The CDP's Water Disclosure Project is focused on ensuring that companies are attentive to the issue.
The opportunity for companies is to engage across these issues to drive efficiencies and decrease risk--both of which are objectives aligned with the core of any business.
For corporate leaders, the take-away is simple. Now is the time to assess your own businesses' corporate water risk and opportunities. Understand where in your company and supply chains you are operating in water stressed areas. Craft facility- and site-specific plans to maximize efficiency, innovate water-less solutions, and collaborate with other stakeholders on grey and green infrastructure alike. Explore partnerships with water authorities as well as local watershed management counsels, environmental organizations, and philanthropic foundations. And, leverage funds to invest in the water infrastructure--grey, green, and informational/ data, alike--that is essential for business, government and society alike.