New research warn businesses and investors about growing water scarcity impacts from Climate Change. Climate risks mean new problems for vulnerable sectors, including Electric Power, High-Tech, Agriculture and Beverages. Water Scarcity and Climate Change; Growing Risks for Business and Investors, February 2009: Ceres Report.
Integrated Water Risk and Crisis Management Initiative: IWRCM
Integrated Water Risk and Crisis Management Platform:IWRMP
Water Risk Management and Exposure to Risks
Water risk mitigation and crisis management is a major issue for the private and public sector. The rate of pollution of water resources, water scarcity, natural and intentional contamination of drinking water and distributions systems, floods and droughts, challenge companies and communities to take steps to ensure that water risks are managed effectively. Integrated water risk management is becoming a high-profile business issue and companies are becoming increasingly exposed to a range of water risks, through their clients, suppliers, or others with a water footprint along the supply chain.
Business risk exposure can materialize if water risks are not managed, addressed, and understood properly. Water users need to detect and identify water risks, mitigate risk exposure and seek solutions to eliminate, respond and manage risks and crisis. Better management is emerging. The risk and crisis management can be grouped into the Commercial, Political,Legal regulatory and Contractual,Resource andReputation.The business categories include firms, suppliers, financial institutions and water infrastructure and services.
Businesses are finding themselves under a growing obligation to disclose and justify their water use and impact – at all stages of production, consumption, and disposal. Some of the key factors have been a growing public environmental awareness and a greater understanding of the critical role of water in different economic and commercial facets of life.
These obligations and factors have translated into real business tangibles including:Concerns about potential water shortages;Natural or intentional contamination of drinking water and supplies;Growth of shareholder activism leading to greater corporate disclosure and transparency around new material risk issues;Growing public pressure on firms to embed Corporate Social Responsibility disciplines in their core business lines;Public policy issues such as influential agencies of codes of good practice and guidelines.
Declining water quality and increasing stresses on water resources worldwide, financial institutions have begun to consider water management policy as a risk to be managed in their portfolio analysis. However, with these challenges come opportunities. Increasing water contamination and water scarcity and the challenges for a sustainable water future present high potential for growth and business opportunities for H2oAlliance and our partners. From the results of interviews and experts, it has emerged that there are great differences between water users in their perceptions of water risks and in the way they handle these risks. There are a number of possible approaches for water users to mitigate their exposure to water risks through influencing behavior in their operations and supply chains.
Key opportunities for mitigating water risks include;
Recommending that water users seek relevant advice and expertise on technical matters where appropriate;
Exchanging views with other water users and peer to engage in the ongoing detection and monitoring of water risks;
Adhering to guidelines which offer concrete areas of action where water users can influence the adoption of environmental, social and corporate governance issues; new approaches to recognizing and mitigating water risks and managing crisis;
A systematic assessment of the water footprints, and water quality, water-efficiency, and sustainability indicators and diagnostic tools for internal use;
Rating exposure and management of water risks;
Risk assessment and testing models; integrating water sustainability into all aspects of operations, and creating incentives for staff to apply these criteria;
Increase stakeholder engagement is critical for improved understanding and identification of potential risks.
A very important aspect of water risk management process is effective detection, communication, planning and better understanding of the water risks. However, a risk management policy can not be developed or improved without the availability of qualified information and real-time data. Therefore, early detection, effective communication, collaboration and project management forms the basis for developing any water risk or crisis management plan or policy. Recognizing this, H2oAlliance has developed an integrated early detection, communication and water risk management platform, customized risk management plan, training program and workshop for companies, industries, organizations and communities. Our goal is to help business leaders and policy makers mitigate and manage risks and respond to crisis situations more effectively through technology.