Addressing the Water Crisis: Innovative Solutions for Change
November 8, 2021
Water scarcity is becoming an increasingly critical global issue at the nexus of climate change, health, and agriculture. The World Health Organization estimates that half of the world’s population will be living in water-stressed areas by 2025.
Solving the water crisis is a complex challenge that demands innovative solutions from the private and public sectors alike. How can leaders work together to set common goals and harness the power of innovation to reduce water scarcity at the scale needed to maintain thriving ecosystems and communities?
This roundtable convened senior leaders in business, finance, and government in Glasgow, Scotland during COP26 to share how they are implementing effective solutions to fight water scarcity.
- Jim Andrew, Chief Sustainability Officer, PepsiCo
- Ezgi Barcenas, Chief Sustainability Officer, AB InBev
- Frantz Beznik, Head of Sustainable Innovation, Procter & Gamble
- Dr. Deborah Brosnan, President & Founder, Deborah Brosnan & Associates
- Ambassador Ertharin Cousin, Founder and CEO, Food Systems for the Future
- David Croft, Global Director of Sustainability, Environment & Human Rights, Reckitt
- Tom Ferguson, Managing Partner, Burnt Island Ventures
- Bernd Halling, Head of Corporate Strategy and Advocacy, Bayer
- Clea Kaske-Kuck, Director, Policy & Advocacy, Food & Nature, WBCSD
- Dr. Rodolfo Lacy, Director of the Environment Directorate, OECD
- Anna-Marie Laura, Director of Climate Policy, Ocean Conservancy
- John Matthews, Executive Director, Alliance for Global Water Adaptation
- Mardi McBrien, Managing Director, Climate Disclosure Standards Board
- Alison Taylor, Chief Sustainability Officer, ADM
- Joe Vesey, Senior Vice President and Chief Marketing Officer, Xylem
- Gary White, CEO and Co-founder, Water.org & WaterEquity
- Andrew Zolli, Chief Impact Officer, Planet
- John Fraher, Senior Executive Editor for Business, Finance and Climate Change, Bloomberg
- Patrick Garrigan, Global Head of Bloomberg Live, Bloomberg
For Ambassador Ertharin Cousin, Founder and CEO, Food Systems for the Future, and a member of the Supervisory Board of Bayer AG, it can’t be stressed enough that a global water crisis is upon us. And despite fire and droughts around the U.S., a majority of Americans don’t believe the climate is changing. She described a long-term disconnect between government and the agricultural and food systems. “Seventy-percent of clean water is used throughout the food system,” Cousin said. “There needs to be a multi-sectoral solution.”
Places like Brazil and parts of Africa are in crisis mode now. “We almost had a Day Zero in South Africa,” Cousin said. She spoke of Kenya being hit by a drought while dealing with locusts and Covid-19. “They’re already feeling like the crisis is here.”
The solutions will come with investments not just in cleanup and increased efficiency now, but in research and development of new technology to further reduce water use for a growing population. “Look around the table. Who’s missing?” Cousin asked. “Where is the global south?” Her recommended goal for COP27 is to get past discussion about who is responsible to fix the problems by getting more nations around that table.
A call to arms is how moderator John Fraher, Senior Executive Editor for Business, Finance and Climate Change, Bloomberg, termed Cousin’s opening remarks, with further discussion to cover private sector challenges, the status on and what is needed to support solutions and how to make water a bigger part of the global conversation.
Segregating the impacts is not the way to mitigate them, according to Ezgi Barcenas, Chief Sustainability Officer, AB InBev. Anheuser-Busch is the world’s largest beer brewer, located in 50 countries around the world and buying directly from farmers in 19 countries. “We are deeply-rooted in the communities where we work and live,” Barcenas said. “We are close to the problems and solutions. We see climate change on the ground.”
She is “fascinated” to hear people talk about bringing environmental and social issues closer together, as if they do not co-exist, calling them “multi-dimensional issues.” Farmers, for instance, when hit by environmental impacts, also suffer loss of income. “But at least it’s being recognized that all dimensions of sustainability are innately combined, Barcenas said.
What is the impact of water scarcity on bottom lines? In 2018, a survey of 483 companies revealed $40 billion is losses, suggesting incentives may be part of the solution.
“If you don’t have water, you can’t wash your hands using a bar of soap,” said
David Croft, Global Director of Sustainability, Environment & Human Rights, Reckitt, which sells health and hygiene products. It was an eye-opening statement, in context, with Croft referring to the challenges of water security in upstream and downstream networks, as well as the human health aspects. That’s the risk side.
Then there are the opportunities; using water and growing crops differently, harvesting more, and recycling, done at their zero-discharge factories, where “nothing goes down the drain.” Reckitt is designing products that require less water to use, such as dishwasher tablets that alleviate the need to pre-rinse, saving 40 to 50 liters of water per load, and in turn, a lot of energy. The impetus, Croft believes, will be more in the opportunities, including the chance to tackle societal issues.
At PepsiCo, food is actually a larger part of the business than beverages. “We touch seven million acres of farmland annually,” said Jim Andrew, Chief Sustainability Officer, PepsiCo. Water is local, and it’s crowded at the program level, according to Andrew, who said duplicate, parallel programs by government, NGOs and the private sector, with all jockeying for credit, are adding to the challenges. Just as important is awareness, along with a need for more consistent discussion about water scarcity, and better data, so “we can stop fighting about the facts.”
An evolution in Cape Town was a story told by John Matthews, Executive Director, Alliance for Global Water Adaptation to illustrate how the private sector there realized what it had at stake and how it could benefit from taking on responsibility for water. What began as anger at civil entities turned into action, not just to assure supply, but to analyze operational and usage data. Most importantly, Matthews said, was the realization that the most important water was in their clients, customers and employees, sustaining them. “But that’s not resilience,” Matthews cautioned, urging enduring solutions, because no matter how much global warming is reined in, “the climate will continue to change.”
Everyone is setting goals, but not often looking to their neighbors to collaborate, “and it’s absolutely essential that we do that,” said Alison Taylor, Chief Sustainability Officer, ADM. Much is about scale. Most farming is done on small margins. For the average farmer, methods like preventive cover cropping, at $15 to $40 per acre, are unaffordable. “We need to provide incentives,” Taylor said. “The entire agricultural value chain has to participate.” On the other hand, “a $100,000 investment, affordable for a large company, can provide water infrastructure for 25,000 people, “and to scale that up is a tremendous difference.”
Private sector investment needs to focus on the right issues, and when it comes to water, pollution is not getting its fair share of attention, according to Dr. Rodolfo Lacy, Director of the Environment Directorate, OECD. He cited more than 70 new pollutants that originate with things that are part of daily lives. “We are eating and drinking microplastics, drugs and new toxics that are introduced into the market every year.” Tackling that problem brings unique challenges such as avoiding increasing manufacturing footprints in the effort toward safety and preventing the loss of public confidence in the system. It’s an “overlapping environmental agenda.” Water security is needed, Lacy said, to enhance climate policies, and that goes beyond supply, sanitation or infrastructure resiliency.
Asked about how investing compares to things like wind and solar, Lacy said it’s less than 20-percent, with most going to mitigation and adaptation. “We need to increase water investment, but with integrated vision.”
Water is poised to go higher up in the agenda, in terms of disclosure and reporting into capital markets, according to Mardi McBrien, Managing Director, Climate Disclosure Standards Board. That is due to the newly-established International Sustainability Standards Board that will start with water guidance she helped write as part of CDSB’s climate framework. She predicted that the existing work will fast-track the development standards to two to three years out, and that should lead to mandates in 140 countries. “So, countries around the world will have to act that way, and, hopefully, McBrien said, “the market can respond at the same time.”
From her work with developing island nations around the world, Dr. Deborah Brosnan, President & Founder, Deborah Brosnan & Associates, offered perspective, calling their water issues much different from those of large agricultural countries. They regularly deal with droughts, which are increasing, coastal erosion and intrusion and lack of access to water storage. “Their environmental, social and economic challenges are all happening at once.”
Circling back to awareness, she echoed the need for more, adding, “We should have better connections between what’s happening here [at COP] and what’s happening there.” They have to explain to many investors and developers the need to conserve water, and try to get them past thinking of it as a cost, instead of an opportunity, Brosnan said. Speed is of the essence right now for the millions of people that need water infrastructure, and need it to be affordable, making it a question of how to “scale innovations into these communities.”
Standards and regulations are sorely lacking in the U.S., said Joe Vesey, Senior Vice President and Chief Marketing Officer, Xylem. Needed is a portfolio approach that includes re-use as a key element. In Connecticut, where he lives, re-use standards were recently approved, but offered no guidance on how to implement them. “If there’s not a North Star, there’s no activity,” Vesey said.
Among the issues getting in the way of scaling is the focus on technology. “Performance needs to be called out because tech can change and grow to hit performance levels. But when you call out technology, it stagnates.”
He echoed the need for awareness, noting dairy’s successful Got Milk campaign, possible because the industry came together. “Water sort of has a tagline,” Vesey said, “The only problem is when you start talking about ‘Day Zero,’ it’s game over.”
Clea Kaske-Kuck, Director, Policy & Advocacy, Food & Nature, WBCSD said their work is moving increasingly from global to local and technology like the India Water Tool. The platform helps identify areas of water scarcity and allows for collaborations toward innovative solutions. It has become apparent in India, she said, that there are issues of open access, transparency and quality of data, and “farmers are becoming more aware of the power and value of data.”
“It’s now a question of what is the incentive for farmers to share their data,” Kaske-Kuck said, “and what can governments do in that space.”
Andrew Zolli, Chief Impact Officer, Planet, painted a picture of NASA scientists making a tiny satellite from a cell phone and sending it to space with an astronaut who tossed it out an ISS hatch, leading to a revolution of much smaller, extraordinarily- efficient satellites. On a daily basis, Planet maps all of earth’s surface daily, filling enormous data gaps and enabling more action. “This data contains countless cues that are relevant to the questions that have been asked today,” Zolli said, noting that it is high-quality and unbiased. They see the daily flux and flow of reservoirs and every farm not following policy.
Farmers are savvy, Zolli said, describing an Iowan corn farmer, for instance, as “an IT shop,” open to data with the potential for vast efficiency gains. “We live in an era of big data, and I believe we are heading into an era of big indicators.” Those indicators, he said, tell us about health and wellness around us, and are essential for aligning climate resources.
Bernd Halling, Head of Corporate Strategy and Advocacy, Bayer, said the discussion about societal needs and technology is still developing, and that there needs to be “an acceptance of innovative technology by users to make it valuable on the ground.” In Europe, a somewhat controversial discussion is growing about how to get private and public sectors working together, and in a timely manner.
Tom Ferguson, Managing Partner, Burnt Island Ventures, said the impetus to fund entrepreneurs in the water sector comes from water being “criminally overlooked.” Of the $40 billion committed to climate tech since January 2020, only about $400 million targets water, or about a dismal 1-percent. “Which is not good,” Ferguson said, “given that climate change is water change.”
The good news is the caliber of water entrepreneurs is improving, “like night and day from three or four years ago,” because they chase opportunities and the chance to do something meaningful. “More and better entrepreneurs will build more and better solutions,” Ferguson said, adding that it’s time for water entrepreneurs to be given the same advantages given to energy decades ago.
Anna-Marie Laura, Director of Climate Policy, Ocean Conservancy, agreed with Ferguson that water is underfunded because it does not tell its story well, but noted that is due partly to a lack of partnering needed to implement change. In the new infrastructure bill, she said, there is “a ton of money” for safe drinking water, stormwater management and evolving loan programs for municipalities and states, but predicts they will be overwhelmed. “It will be too much for them to get the money out the door,” Laura said. “We should be ready to help them build their capacity.” As well, coastal towns are struggling to keep up with the huge risks to those ecosystems.
On how more focus can be put on water, Gary White, CEO and Co-founder, Water.org & WaterEquity, said he takes the perspective of the 750 million people who wake up every morning to a water crisis, who are essentially the climate refugees. “We need to talk about resiliency for those people.”
Philanthropy money is not going to get the job done, White said, which is why coalitions are creating the plumbing from capital markets to loan programs. “With about 150 financial partners around the world, we’ve been able to catalyze about $3 billion for people to get access to water and sanitation.”
“These solutions don’t have to come from the top down,” he added. “This is 40 million people who said ‘I’m not waiting for anybody else to figure it out. I want a loan. I’m not going to wait for charity’.”
Addressing the Water Crisis: Innovative Solutions for Change was Proudly Sponsored By