Context

Water is a uniquely complicated resource for companies to manage and report because its value, availability, and quality vary significantly depending on location. A critical component of the water disclosure process is assessing and reporting how location-specific factors relate to the business.

Here we offer insight and resources for how a company can assess water-related basin conditions and report the degree to which it operates in water-stressed or high-risk areas.

	Content	Scope	Format
Basic	Profile: High-level assessment of basins across a portfolio	Companywide	Tabular and narrative; quantitative
Advanced(includes basic reporting)	Detailed, location-specific assessment of basins where water challenges are pronounced	Location-specific	Tabular; qualitative
	High-level assessment of basins in which key value chain actors are located	Value chain	Narrative; qualitative

BASIC

High-level assessment of basins across a portfolio

Basic reporters assess at a high level the extent to which their operations are located in water-stressed or high-risk regions. This information serves as a key component for many of the companywide metrics described in the ensuing Performance section. Such an assessment also helps companies identify and report water-related hot spots where sustainable water management practices may be prioritized.

Free web-based tools that some companies use to better understand the basins in which they operate, include:

• WBCSD Global Water Tool
• WRI Aqueduct Water Risk Atlas
• WWF-DEG Water Risk Filter (Quick View)
• WFN Water Footprint Assessment Tool

When reporting on this topic, companies should indicate the specific tool or methodology they used.

ADVANCED

Detailed, location-specific assessment of basins where water challenges are pronounced

Assessing various contextual factors in specific hot spots enables companies to formulate a nuanced depiction of the risks and impacts in those areas and ultimately to determine the most appropriate and effective response strategies. Reporting on this topic involves two key elements: the drivers and the relative severity of key water-related challenges.

Drivers
Advanced disclosers describe the drivers contributing to water-related challenges in that basin, potentially including

• Water scarcity and water stress
• Poor ambient water quality
• Regulatory uncertainty
• Insufficient infrastructure
• Inadequate access to water and WASH services
• Drought
• Flooding
• Climate change
• Changing demographics
• Limited management capacity
• Ecosystem vulnerability
• Total basin availability
• Supply variability
• Cultural and religious values
• Media awareness

Further guidance and datasets that can help companies better understand each of the above conditions in the basis in which they operate, can be found at: Datasets and Tools for Context Reporting

Severity of challenges
In addition, companies describe the severity of the identified drivers. This type of assessment can be conducted using the datasets and tools described under Basic Practice. Additional tools that involve a higher degree of sophistication are also available, including:

• GEMI Local Water Tool
• WWF-DEG Water Risk Filter (Full Assessment)
• WFN Water Footprint Assessment Tool

High-level assessment of basins in which key value chain actors are located

Advanced reporters share contextual data related to key value chain actors, most commonly suppliers. Companies can describe a high-level characterization of the extent to which basins in which key value chain actors are located are water stressed or otherwise at high risk by using one of the online tools listed above or a company’s own proprietary analysis.