APAC Businesses Must Prioritize Corporate Water Management Strategies: Here's Why

Corporate Water Risks in APAC: A Growing Challenge

Water management strategies in the Asia-Pacific (APAC) region have fallen short of expectations, as highlighted by a recent report from Kering and the National University of Singapore (NUS). With more than half of the world's population residing in this area, businesses are grappling with significant challenges related to water scarcity and quality, driven by urbanization, climate change, and over-extraction. As these issues become more acute, effective water stewardship is paramount for APAC's corporate landscape.

Why Water Stewardship Matters

The integration of water management into Environmental, Social, and Governance (ESG) frameworks isn't just an ethical obligation; it is a pragmatic necessity for survival in the current climate. Failure to address these water-related challenges can have dire consequences ranging from operational disruptions to reputational damage, which ultimately threatens a company's sustainability and social license to operate. Businesses must recognize that water is a critical resource that underlines their operational efficiency, risk management, and community relations.

Key Issues and Impacts of Poor Water Management

• Physical Scarcity: The risk of drought, coupled with groundwater depletion, poses significant threats to industries reliant on consistent water availability.
• Regulatory Obligations: As governments implement stricter water regulations, companies face increasing compliance costs and penalties if they fail to meet these standards.
• Social Risks: Conflicts with local communities regarding water access can lead to reputational issues that may jeopardize brand sustainability in the market.
• Supply Chain Vulnerabilities: As major suppliers face disruptions due to water stress, companies may see product quality decline, reflecting poorly on their own operations.

Moving Towards Effective Water Management

To combat these escalating water challenges, businesses in the APAC region need to reassess their water strategies and adopt comprehensive water stewardship practices. Effective water management is no longer an optional add-on but has become critical for securing future operations. Companies should conduct thorough water risk assessments, engage local stakeholders, and invest in innovative technologies to enhance water efficiency.

Examples of Successful Water Stewardship

Leading companies like Nestlé and PepsiCo have set examples of how proactive water management can yield substantial benefits. Nestlé's initiatives in India demonstrate how targeted watershed projects can help restore local water levels and build community goodwill. Furthermore, PepsiCo's use of membrane bioreactor technology illustrates the potential of recycling and reusing process water to minimize freshwater extraction.

A Call to Action for Corporates

The business community, especially within the APAC region, must understand that adapting to water sustainability is crucial not only for effective risk management but also for attracting investment in an increasingly eco-conscious global market. Clear and transparent water reporting is essential for building trust with stakeholders, enhancing company reputation, and aligning with the evolving investor expectations around ESG performance.

Conclusion: The Future of Water Management in APAC

As the urgency surrounding water security continues to grow, companies must prioritize water stewardship to ensure their longevity and success in a resource-scarce world. To thrive in the future, embracing innovative strategies and adapting to sustainable practices is no longer a luxury but a necessity. Businesses that fail to recognize this will face increasing operational risks and reputational damages.