Water Valuation: Building the Business Case


Most businesses depend on and impact water in some way. At the World Business Council for Sustainable Development (WBCSD), many of our member companies across a wide variety of sectors are trying to solve the problem of ever-diminishing water supply. Water is already limited in many parts of the world and impacting business operations,  while the demand for it is predicted to increase globally by 55% by 2050, with especially dramatic demand in the electricity production (140%) and  the manufacturing  (400%) sectors[1]. While technical innovation and watershed stewardship are part of the answer, our company members believe that better valuing, and pricing, water is also a key part of the solution.

 From WBCSD’s “Water Valuation: Building the Business Case” – Business case arguments for valuing water

WBCSD’s “Water Valuation: Building the Business Case”, released today, reviews drivers and effective arguments for companies to engage in water valuation, based on 21 case studies.  Some businesses have already started incorporating the value of water and other ecosystem goods and services into their decision-making (see The Guide to Corporate Ecosystem Valuation.A framework for improving corporate decision-making.)

As a first step on the water valuing journey, many companies are quantifying water use via the WBCSD Global Water Tool.  Veolia and Hitachi have used water valuation to inform land management options and desalination plant investments, respectively. The Dow Chemical Company, in partnership with The Nature Conservancy, is studying how alternative management scenarios will impact water allocation for different watershed stakeholders.  ITT (now Xylem) undertook a valuation questionnaire to determine how much the public and businesses are willing to pay for improved water service in the US. Puma developed an environmental profit and loss account (E P&L) that includes estimated societal costs of, among other things, water use across their supply chain.

But we’ll need more than a project here and there to foster a marketplace that effectively values and prices water.  To help scale up the practices being piloted by these leading companies, WBCSD is rolling out Business and Ecosystem Training around the world, with the goal of building internal capacity within corporations to recognize and manage risks and opportunities around ecosystem goods and services. And we’re working with great partners like Growing Blue to promote the urgent need for all of us to get our values (around water) right.

About Jessica McGlyn
Jessica is a Director at WBCSD U.S., Inc. (a subsidiary of the World Business Council for Sustainable Development – WBCSD).

[1]OECD Environmental Outlook to 2050: The Consequences of Inaction. Organisation for Economic Co-operation and Development (OECD).

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