2:36
So today we're going to present a webinar on water stewardship through supply chain visibility, risk, resilience, and opportunity.
2:44
And this is being presented by myself, Toby Townsend, and my colleague Sarah Taylor, and we both work for RSK.
2:54
So businesses in the food and drink sector are being told more and more often now to understand what their water risks are, but how do they do this when they don't have supply chain visibility?
3:07
Where do they even start on this? That's going to be the topic of today's webinar.
3:14
We're going to start by giving a brief introduction to water stewardship and the importance of identifying water risks.
3:21
We'll then look at the progression of water stewardship maturity.
3:27
We'll then look at how do we identify these water risks for our supply chain and we'll look at that in two contexts.
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We'll look at it where we have some visibility of our supply chain and then we'll look at it in a situation where we have only limited visibility of the supply chain.
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And then we'll look at the next step. So how do we go from that towards leadership and water stewardship?
3:50
And at that point, we will then have some question and answer session.
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If you have any questions that come up during this webinar, please just enter them in the chat box that you should see on your screen to the right.
4:10
So water stewardship.
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What is it?
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Well, one definition is using water in a way that is socially equitable, environmentally sustainable and economically beneficial.
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But there's lots of different definitions for water stewardship and perhaps you've all got a slightly different view on what water stewardship is.
4:29
The way that I see it is basically it's a lens that we can look at our business through that considers the impacts of water on our business and also how our business impacts other users of water.
4:45
This definition we have on the screen probably seems quite daunting.
4:49
There's a lot to it but water stewardship is a journey and the starting point could be something very small and that's what we're going to be looking at in this webinar. Now why does water stewardship matter?
5:07
Well there are a lot of risks that businesses face around water and there's three key physical risks.
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The situation where there's too little water, situation where there's too much water and a situation where there's polluted or dirty water.
5:26
And this works two ways. So we have this double materiality aspect. We've got the impacts on our business from these three physical risks, and then the impacts on other water users from your business in terms of these three physical risks.
5:41
I work in the agricultural sector. My focus is on production systems, and we see these physical risks playing out all the time.
5:51
For example, too little water, well, this spring has been incredibly dry in the UK.
5:58
That's going to have had quite a big impact on some crop production.
6:03
At the same time, though, there's also debate around how much water should agriculture be using in terms of irrigation.
6:11
Should actually that amount of water be reduced and actually more of it allocated to home use, for example?
6:20
In terms of too much water, well, in recent years, we've had periods of heavy rainfall, and we've ended up with water pooling on fields.
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We've had ponds falling that have lasted for weeks or even months, and crops can't grow in those conditions.
6:35
That's had a big impact in some parts of the country.
6:39
But likewise, agriculture potentially has an impact on downstream uses of water.
6:45
There's a lot of interest in understanding how we can keep water on agricultural land so that it avoids flooding downstream.
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There's an interest in making agricultural land more spongy, so being able to temporarily hold onto that water and then gradually release it later on in a way that reduces those risks of flooding.
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Then we have this issue of polluted or dirty water.
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There's a lot of talk around water companies allowing sewage into our water courses, but actually perhaps a bigger problem is water coming off agricultural land that has pesticides and fertilizers in it.
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That might be a much bigger impact on water quality than sewage.
7:31
So we've got these risks, and they could have a serious impact on business continuity.
7:37
But this is perhaps a bit of a negative way of looking at water stewardship, and I think Sarah might be able to put a bit more of a positive slant on it.
7:48
Yeah, perfect.
7:48
So creating a water stewardship strategy is an important step for us to be able to start looking at opportunities and how we can mitigate these different risks.
7:57
So Toby spoke a little bit about the physical risks, but looking at reduced costs, we all happening against a wider backdrop of food and drink inflation jumping to 4.4% this month, up from 3.4% last month, driven largely by rising energy and ingredient costs.
8:18
So in this context, water stewardship becomes a cost control strategy.
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So it can encourage innovation across the supply chain and within operations.
8:28
So in short, the more efficiently you manage your water, the more resilient your business can become to these inflationary shocks.
8:35
And stakeholder scrutiny around water is also growing is another aspect, especially in these water-stressed areas where local communities and agricultural as well as industry all are relying on the same finite resource.
8:48
So this year specifically, we've seen quite a rise in public and political attention on water quality and availability in UK catchment specifically.
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So local engagement is no longer just a good look, it's increasingly linked to companies' license to operate.
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And looking at reduced financial risks in 2025, there's quite an increase in regulatory pressure on water use.
9:11
So particularly around EU legislation like CSRD and the upcoming CSDD, and businesses are being held more accountable for their water footprint across the value chain.
9:23
So by clearly defining what water stewardship means for your business, including your risk spots and mitigation measures.
9:31
Your company can reduce the chance of any future financial exposure and as well as strengthen investor confidence. Moving to the next slide.
9:41
So we see water stewardship as a journey and looking across how your operational and supply chain water visibility helps you progress along this journey.
9:52
So starting at the bottom left side, left hand corner at Blind Spot.
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So this is the most common starting point but also is the most vulnerable.
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So here we have no visibility into supplier water risks.
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So your company may know what you're buying and from whom but not where it is sourced or what the local water conditions are.
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You may not have an understanding what data to collect from who or why.
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So in this space, water risk remains quite invisible.
10:20
Moving up to fragmented insight, Some suppliers may provide water use or location data, but it could be patchy, inconsistent, or not specifically tied to water risk.
10:32
There may not be a consistent method for evaluating water risk here, or its potential impact on your operations, your reputations, or communities.
10:39
So just not linking that data to the actual risk itself.
10:44
And moving more towards the midline, looking at visibility.
10:48
So sourcing regions and supply chain tiers may be mapped, and water risk data is collected.
10:54
So now we can start looking at tools that can be used to help hotspot water-stressed areas and your company can begin to see where action is needed and then can prioritize your high-risk supplies or regions.
11:07
Moving through to strategic action, this is when we now have all of the data we need and this starts to inform supplier engagement as well as target setting and measurable improvements in water use.
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And the final stage, as the goal, is looking more towards leadership.
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So water is now integrated into your internal strategies, as well as your sustainability and ESG-related strategies.
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Your company can begin to disclose transparently across the multiple frameworks, and you're seen as a sector leader and can attract that investment and secure more sustainable and lower-risk supply contracts and begin to build longer-term trust.
11:44
So, I'll hand over back to Toby, who will be talking us through the first three areas of Lion's Park through to visibility.
11:53
Yeah.
11:53
So, a question, where are you on your water stewardship journey?
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Do you know where water risks lie across your operations and supply chain?
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Do you talk to your suppliers and are they able to share useful data around water risks?
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And, have you connected water risk to your source and choices and product decisions?
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Now, if you are at the start of your water stewardship journey, well, where do you go from there?
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I'd like you to think about the ingredients that are in your products.
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What are the main ones that you are using and which are the most vital to your products?
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And, have you made certain claims about these ingredients?
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things like 100% British or locally produced.
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I know when I'm in the supermarket, those are the kind of things that appeal to me as a consumer.
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Maybe it's organic produce, or as we're seeing more often now, regeneratively produced products.
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But the question is, if you're thinking about those ingredients, what happens if their supply was compromised?
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What happens if it becomes harder to access those ingredients once it becomes more expensive to access them.
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And do you understand how water risks might impact on the supply of those ingredients?
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You've got an idea of those water risks associated with those ingredients.
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And if so, have you put in place actions to mitigate those water risks and limit those impacts on your business?
13:37
Well, if you're at that early stage in the water stewardship journey, so the blind spot or the fragmented insight, what do you need to be doing?
13:47
Well, it depends on how much visibility you have of your supply chain.
13:53
If you've got some visibility, then there are certain actions you can take to start understanding those risks.
14:00
If you know the specific locations those ingredients are being produced, but you can map them and then you can assess what are the specific water risks in those locations? What are those risks across those catchment zones?
14:14
You can look at that in terms of the situation now, but also how is that situation going to change over time as population pressures increase, as climate change increases?
14:26
And perhaps if you see that supply is focused on a particular region with high water risk, maybe you can production away from there or look at spreading it across multiple regions.
14:41
If you know your specific suppliers, we could engage with them, see how they are going about understanding water risks. Are they measuring these and are they putting in place mitigation actions?
14:55
And perhaps if they aren't, well, maybe you could look at diversifying your supply chain to spread out those risks. And if you know who your specific producers are, well, engage with them.
15:09
You can look at how they're going about managing their production systems in a way that manages water risks. You could even model water use.
15:20
You could look at where are their inefficiencies in water use.
15:23
You could identify ways of improving that and you could potentially support those farmers and producers to adopt best practice, so that they're using water in a better way and in a way that builds resilience into the system so supply is less likely to be impacted by water risks.
15:45
And taken together, that can help you to start reducing your water risks.
15:51
But what happens if you have only limited or no visibility of your supply chain?
15:56
You don't know where those ingredients are coming from.
15:58
you are in that blind spot.
16:02
Well, here, and I don't know if this is because I've been watching a few too many true crime documentaries, but I feel like here, we need to be detectives.
16:10
We need to really drill down into the clues around us to get a bigger picture.
16:18
There might not be a smoking gun telling us what those water risks are, but through collecting little bits of evidence, we can develop a bigger picture, and that can then help us to identify where are the priority areas, where are the areas that we really need to put resources into collecting better data to help us truly understand those water risks.
16:40
So in terms of what locations, we might not know where those ingredients are coming from, but we can look at where are those ingredients produced globally, where are they most likely to have come from.
16:53
And we can look at things like, is production dispersed or concentrated?
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If only, if production's happening mostly in one small area, then that suggests there might be more risk than if production is spread out globally.
17:08
And we can look at the water risks in those particular production zones.
17:14
We can look at how they might change under climate change and population growth.
17:20
If we're not really sure of the supply chains, who's supplying those ingredients, well, we can map where the most likely supply chains are likely to be occurring, and we can look into what is the likely impact of a reduction in supply.
17:39
What impact will that have on competition?
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Is it that we could move to a slightly different ingredient?
17:46
We could substitute to that.
17:48
Is it that other businesses could do that?
17:51
How will that impact on competition?
17:54
And then if we don't know who our particular producers are, who our farmers are, well actually we can look at what are the key systems being used to produce those ingredients.
18:05
For example, is it a rain-fed system or is it irrigated?
18:10
We could look at getting some standard water footprints for the production of those food items in different countries and we can relate that amount of water required for that ingredient to the water risks in that particular location.
18:29
And we can take this data and that can help us to understand where are the risks likely to lie and therefore where do we want to be going about increasing our visibility of our supply chain.
18:44
And this will take us from that blind spot through to fragmented insight and then we want to be looking at how do we move to visibility and then on from there and I'll hand over to Sarah to look at that. Great thanks Ruby.
19:02
So we're beginning to see that water stewardship is no longer just about minimizing impact it's seemingly becoming a space of innovation and leadership and contribution.
19:11
So if we go through to the next slide Water stewardship today looks at efficient use, risk mitigation, and local engagement, but interestingly we're seeing a growing number of global companies including major names in food and beverage, but also tech like Google and Amazon have begun to pledge to be water positive by 2030 to 2050.
19:35
So this now means replenishing more water than they consume, looking at improving access well as actively supporting the ecosystems and communities that they affect.
19:45
So part of our team are involved in the water positive initiative and even though it's currently voluntary, it's gaining quite a lot of global traction even holding a spot at the UN and it's opening a door to things like water credits and volumetric benefit tracking as well as reputational leadership.
20:03
So for those who have already taken steps in stewardship this is looking at the the next will be on that. I'm going to the next slide.
20:11
To make this a little bit more practical and tangible, what does water stewardship look like in practice?
20:18
And a great example of a global food and beverage company's approach to water stewardship is its commitment to replenish more water than it uses in its finished product, a goal that has been met consistently since 2015.
20:31
So this company specifically recognize that water is a local resource and the company identified over 200 high risk sites across its global operations, representing nearly a third of its footprint.
20:43
So these locations are prioritized for water replenishment efforts with risk assessments updated regularly to ensure that actions are targeted where they're most needed.
20:53
And the company strategy includes improving water use efficiency across its operations, treating and safely returning water to communities as well as investing in local water access and ecosystem restoration projects.
21:07
So I think this is quite a great example of not only water stewardship, but moving towards leadership and being water positive.
21:14
So going through to the next slide.
21:17
So specifically how we help is our team partners with clients to build a care data-driven view of their water risks as well as the opportunities.
21:26
So from assessing availability and supply reliability, to identify your emerging risk hotspots.
21:33
So we help translate that insight into actionable and science-based strategies that protect continuity, look at strengthening disclosure, as well as position companies as leaders in sustainable water stewardship.
21:46
So if we go through to the next slide, we'll also be sending these slides through to you all.
21:51
So please go ahead if you'd like to scan the QR code to book a complimentary consultation with our experts to explore where you are specifically on your water stewardship journey and also where you want to go to next.
22:04
So I'm looking forward.
22:06
And we're gonna move into some question and answer sessions and I'm just gonna have a little look in the box to see what we can get started with.
22:22
Okay, so a question around, is this a new disclosure framework or just another way to disclose water use?
22:29
and how does it differ from water resource management plans?
22:35
Okay, so just to, this isn't a new framework, it's rather a new lens.
22:42
So water stewardship doesn't add to your workload, it more enhances the sustainability related goals that you've already embedded in your business.
22:50
And it just helps make water risk and opportunity more visible and actionable.
22:56
So we're not talking about a new set of reporting rules, rather we're helping companies use existing frameworks that you may already be into.
23:04
CDP or CSRD and TCFD, all of the many different acronyms, but using those more effectively by aligning water stewardship principles to them.
23:15
So plans like your water resource management plans are typically developed by utilities or regulators to guide public water resource management, but water stewardship on the other hand is about corporate responsibility and how your business interacts with water across its operations and supply chains and how it manages those dependencies, the impacts, as well as, importantly, the risks.
23:37
And this work I really feel is so paramount.
23:39
I mean, just 2.5% of all water on earth is fresh and 70% of that is already used for agriculture.
23:45
So that leaves a very limited share for industry, people, and nature.
23:50
So this isn't just a good idea.
23:52
It's quite a necessary one for resilience as well as credibility. I hope that clears that up.
24:00
I'll hand over to you, Toby, to maybe take another one. Yeah, so I guess, yeah, I've got a question here.
24:09
So which ingredients are most at risk? Well, we don't have a list of those most at risk ingredients.
24:17
That's something we'd have explore. But there's certain things which will determine that level of risk.
24:26
So specialist ingredients where they're only grown in minor quantities in specific locations, they're going to be more at risk than our sort of main commodity crops that are grown globally in large amounts.
24:43
You need to think about areas where not only might the production of the ingredient be impacted by water risks, but also that infrastructure that's required to get that ingredient from its place of production through to the business.
24:58
So could it be the road infrastructure?
25:01
Could it be the requirement for cold storage, for example, that could be impacted by water risks, limiting the availability of that ingredient for us?
25:12
And we need to look at those particular areas where they're being grown, and is water demand starting to outstrip water supply?
25:21
Is it likely that in a few years' time, that ingredient might not be possible to be produced in that location?
25:31
And are there contingency plans for producing that ingredient elsewhere?
25:38
And it's also about understanding how climate change is going to impact that particular area.
25:43
No, maybe it's that we get a certain consistency to our rainfall in that area, but under climate change it might become more erratic and therefore production might be compromised in the future.
26:00
So it's all about getting these little bits of evidence and building a bigger picture about those key ingredients.
26:10
Sarah, have you got another question you'd like to answer?
26:14
Sure. I think this one might have a bit more of a hopeful and positive spin too, which is good.
26:23
And so the question is, you spoke about the risks and there being opportunities.
26:27
What does it look like when companies turn water risk into opportunity and this strategic opportunity?
26:33
So I think companies that take water seriously aren't just avoiding the risk, they're also being able to spot opportunities early and sort of staying ahead of the change.
26:41
So take the champagne industry, for example, as climate and water conditions are shifting, some producers are now buying land in regions like the UK, where the warmer temperatures and favorable growing conditions are now offering the right climate for sparkling wine production.
26:58
So it's quite a bold and proactive move, but it's showing that we're not just starting to react to risk, but reshaping the future market position.
27:06
So I think this is quite integral to the mindset behind water stewardship.
27:11
it's not just about reducing consumption, it's about really effectively using the data and local insight to future proof your operations and thinking about diversifying supplies Toby mentioned and even maybe innovating new offerings.
27:25
So for companies in food and drink that can mean identifying the supply vulnerabilities early or capturing new market opportunities that others may not have seen yet. So hopefully that's also quite a positive spin on it all.
27:40
Yeah, and we have another question here.
27:43
So, we are currently being asked by our customers to show a water risk assessment for our supply chains.
27:48
Do you have any advice about this or what should be included in that?
27:53
I don't know, Sarah, if you've got any suggestions for that.
27:59
Well, I think that goes quite back to your slide, Toby, about figuring out location as as starting to work with your suppliers on what data they may have on, you know, if they are even collecting data on water use and understanding and giving you that site of exactly where they're sourcing their ingredients from too, and just starting to build up a better picture.
28:23
I don't know, Toby, if we maybe go back to that slide or if you want to reiterate sort of from the blind spot, yes.
28:31
Yeah, so there isn't a specific framework for doing this.
28:37
It's very much an ongoing process where you start collecting that initial data and then starting to build up a bigger picture.
28:52
I think that it's something where there is no right final answer.
29:01
it's a case of an ongoing journey but I think sort of understanding where are those key ingredients coming from and what are the, you know, what kind of risks could there be and building the bigger picture from that. Any other questions?
29:34
I don't think we do. It's a bang on time then coming to half past. Perfect, well thank you so much.
29:46
As we mentioned, we will be sending the slides through as well as that QR code with our contact details.
29:54
So hopefully we'll be chatting to more of you in the near future and thank you again for joining today.
30:00
Thank you.
