WaterMajor food companies must adapt to growing global water risks
Escalating water competition, combined with weak government regulations, increasing water pollution, and worsening climate change impacts, is creating unprecedented water security risks for the food industry. In California, an estimated half-million acres of farmland have already been fallowed by a prolonged drought, causing more than $1 billion of economic losses for the agriculture sector. Major U.S. food companies need to adopt far stronger practices to use limited global water resources more efficiently, according to a new report. The report ranks the U.S. thirty-seven largest food companies on how effectively they are managing precious freshwater supplies. While a relatively small number of firms are taking broad actions to manage water risks in their operations and supply chains — Unilever, Coca-Cola, Nestlé, PepsiCo, General Mills, and Kellogg, among those — most have a long way to go in using water more sustainably, the report concludes.
Major U.S. food companies need to adopt far stronger practices to use limited global water resources more efficiently, according to a report released last week by Ceres, a nonprofit sustainability advocacy group.
The report, Feeding Ourselves Thirsty: How the Food Sector is Managing Global Water Risks, ranks the U.S. thirty-seven largest food companies on how effectively they are managing precious freshwater supplies. While a relatively small number of firms are taking broad actions to manage water risks in their operations and supply chains — Unilever, Coca-Cola, Nestlé, PepsiCo, General Mills, and Kellogg, among those — most have a long way to go in using water more sustainably, the report concludes.
“The twin challenges of global water scarcity and pollution are contributing to a water availability emergency that threatens the profitability of food companies and long-term food and water security,” said Brooke Barton, senior water program director at Ceres, who co-authored the report. “The good news is that more food companies are beginning to respond to these risks, but they must deepen and broaden their efforts, especially in regard to agricultural supply chains.”
A Ceres release reports that the report examines how water risks are affecting the profitability and competitive positioning of food companies, such as by disrupting operations, limiting growth or increasing agricultural input costs, in four industries: packaged food, beverage, meat and agricultural products. Companies were each scored on a 1- to 100-point scale on their responses in anticipating and mitigating these risks, with the highest score being Unilever with 70 points, the lowest being Monster Beverage and Pinnacle Foods, with just one point each.
Top scoring companies by industry were Unilever (Packaged Food: 70), the Coca-Cola Company (Beverage: 67), Bunge (Agricultural Products: 29), and Smithfield Foods (Meat: 33) (see all company scores here).
The report makes clear that escalating water competition, combined with weak government regulations, increasing water pollution, and worsening climate change impacts, is creating unprecedented water security risks for the food industry. In California, an estimated half-million acres of farmland have already been fallowed by a prolonged drought, causing more than $1 billion of economic losses for the agriculture sector. Similar water risks are being experienced in other major growing regions, including Brazil, Mexico and China.
