Expectations about corporate responsibility continue to increase all around the world. Because of these, many water-related business risks stem from stakeholder perceptions that company does not conduct business in a sustainable or responsible fashion.
Affected communities, civil society, investors, consumers, and the general public are increasingly engaged in issues of water sustainability. Inefficient water use or excessive pollution by a company in a sensitive watershed, whether real or perceived, can be incredibly damaging to a global brand’s reputation, share price, and ability to conduct business.
When a company is, or is percieved to be, inefficient, unsustainable, or otherwise irresponsible, the following reputational damage can occur:
- Decreased brand value and consumer loyalty
- Reduced investor confidence
- Adverse regulatory responses
- Loss of social and legal license to operate
As public interest in water sustainability grows, companies’ water practices are facing greater scrutiny. Water-related controversies often gain the attention of major media outlets and investors are taking into account how companies control their water use and plan for water-related business risks.