H&M, Unilever report exposure to water risks to CDP

CDP’s most recent annual global water report finds that 22 per cent of companies expect issues surrounding water to limit their growth in business, such as Diageo, H&M, Merck and Unilever.

A growing number of investors since 2010 are encouraging corporate accountability on water and water related information through CDP, indicating the growing shareholder interest to water challenges.

Almost 853 reported risks are expected to affect the present and future condition of companies, finding themselves at a competitive disadvantage.

Furthermore, the report emphasises that water pressures will be felt among emerging markets such as Brazil, China, India and Mexico.

Companies such as Diageo, H&M, Merck and Unilever have begun to respond to the water risks by analysing methods to prevent it.

Similarly, three quarters of companies assess how the quantity and quality of water affects their growth strategies. Figures of 90 per cent of companies are integrating water into their group-wide business strategies and 82 per cent are setting targets to reduce their consumption of water.

Leading companies are prioritising the prospect of cost saving and increasing revenues. 

German Chemical Giant BASF’s calculation on water saving, recycling, reuse and drinking water treatment products offer prospective sales of $1bn (£640m) by 2020.

Currently, electronics manufacturer Cisco is accumulating $1m (£640,000) annually from conserving their consumption of water.

However, despite the positive actions, disclosure levels of the FTSE Global 500 Equity Index provided to CDP have failed to meet investor demand for information. A figure of 42 per cent of companies failed to provide information relating to their water risks.