Food Industry Should Become More Water-Efficient: New Report
(3BL Media/Justmeans) - One of the most vulnerable industries when it comes to the issue of water scarcity is the food industry. Ceres has released a new report in which it urges major food companies to take steps to limit their use of fresh water resources, make their use more efficient, and reduce climate change impacts, which affect directly food production.
Called Feeding Ourselves Thirsty: Tracking Food Company Progress Toward a Water-Smart Future, the report ranks the 42 largest global food and beverage companies, and rates their behavior related to corporate water risks, such as water dependence, water security and operational water use efficiency.
Reporting used publicly available data from sources such as 10-K filings, sustainability reports and the CDP Global Water Report. Companies were then scored on several criteria, including how they manage water through governance and strategy and in their direct operations, manufacturing and agricultural supply chains.
The food industry is worth $5 trillion globally, and climate change now poses some severe challenges to that economic sector, due to more, bigger floods and prolonged, extreme drought. Companies reported on were placed in four different categories: packaged food, beverage, agricultural products and meat. Each was then analyzed in relation to water risk management action.
The companies that achieved the highest score (out of a 100) were Nestlé (Packaged Food) with 82, up from 64 in 2015; Coca-Cola (Beverage), 72, up from 67 in 2015; Smithfield Foods (Meat), 33 and Olam (Agricultural Products) with 49—and a new entry in the report.
The report found a 10 percent improvement in the average score of the food sector’s management of water risk since 2015. The packaged food and meat industries also improved their scores at 16 and 20 percent, respectively.On a less appetizing note, the average score for the 42 companies benchmarkedwas still only 31 points. The meat and agricultural products industries continue to fare worse than the packaged food and beverage industries.
“Smart water management is a business imperative for food companies, as the impacts of climate change and water scarcity and pollution are accelerating around the world,” Brooke Barton, senior director of water and food at Ceres and report co-author, said. “Some corporate leaders are making strong progress, but the majority must do more to water-proof their businesses to protect and sustain our water supplies.”
Some of the areas that have made most progress since 2015 are the integration of water risks into business strategy, setting water targets, water accounting, risk assessment and sustainable sourcing programs. In this regard, leading companies include General Mills (GIS) and Unilever (UN) for risk assessment, and Kellogg’s (K) for sustainable sourcing.
One of the findings of the report is that, despite their vulnerability to the effects of climate change, more than one-third of the publicly held companies analyzed made no mention of climate-related water risks in their most recent 10-K filings, despite changing weather and precipitation patterns that threaten the sector.
The report concludes that overall, companies “need to improve most on governance and board oversight, wastewater management, integrating water risk into procurement processes and collaboration to protect watersheds."
To access the full report, go here.