By Jason Morrison and André Ramalho
As climate change continues to exacerbate water risks, many companies have acknowledged the risks and opportunities that arise from the water-climate nexus. Some businesses are seeking a clear course of action to face these challenges. Others are going above and beyond – asking themselves how they can meaningfully contribute to improving water security more broadly, beyond the confines of their own companies.
A growing number of companies are now turning to one framework in particular to achieve that broader water ambition.
NPWI: Addressing the need for shared purpose
The Net Positive Water Impact (NPWI) concept was built with this context in mind. It is an aspiration that not only informs how a company manages water within its own operations, but also how it interacts with a basin, its ecosystems, and its communities more broadly. Delivering NPWI contributes to reducing water stress in its three dimensions: availability (quantity), quality, and accessibility. It ensures that company’s contributions continually exceed impacts on water stress in the same region. The concept has been adopted by the UN Global Compact SDG 6 Ambition as the cornerstone to catalyze innovative business strategies that accelerate companies’ positive impact on SDG 6 targets.
The concept is one of the pillars of the pledge companies make when joining the Water Resilience Coalition (WRC). This initiative was launched on World Water Day 2020 by the CEO Water Mandate, a partnership between the UN Global Compact and the Pacific Institute, and seven co-founding companies. Over the course of two years, WRC members and a group of technical advisors, including the Pacific Institute, The Nature Conservancy, the World Resources Institute, Water.org, Ross Strategic, Pegasys, and many others, have collaborated to give shape to the NPWI concept.
In terms of where the concept sits within the broader corporate water stewardship landscape, it’s best to think of NPWI as a purpose, not a practice. NPWI provides an orientation for a company’s water stewardship programs:
- Focuses effort: Links enterprise ambition to areas with the greatest need (i.e., water-stressed basins)
- Boosts effort: Expands both scope (i.e., three dimensions of water stress) and depth (i.e., positive operational and/or value chain footprint within all water-stressed basins)
- Aligns effort: Explicitly aligns company’s water ambition and effort with public sector and civil society counterparts (i.e., linkage to SDG 6).
Investing where it matters most
In line with the SDGs and latest global practice, NPWI focuses on basins where companies can have the greatest impact. That means businesses will prioritize their activities and investments in the water-stressed basins in which they operate. As on-the-ground conditions, collective action, and data availability and reliability change over time, the list of water-stressed basins will evolve. This makes NPWI truly a journey. Conditions in river basins and in companies’ operational impacts also change over time. Companies that pursue NPWI do so continually to maintain their positive water impact.
But what do we understand by water-stressed basin and what are the dimensions against which progress is measured?
Broadening enterprise ambition
In the context of NPWI, a basin is considered water stressed when it does not meet sustainable thresholds relative to the three dimensions of water stress: availability, quality, and/or access. Businesses have predominantly set enterprise level water goals around volumetric water targets, which relate to availability. However, on the journey to NPWI, companies will consider their direct operational impact across all three dimensions.
These three dimensions connect directly to SDG 6 targets:
- Availability connects with SDG 6.4. This target seeks to substantially increase water-use efficiency across all sectors, while ensuring sustainable withdrawals and supply of freshwater to address water scarcity and substantially reduce the number of people suffering from it.
- Quality is covered by SDG 6.3. This target focuses on the reduction of pollution, elimination of dumping, and minimizing release of hazardous chemicals and materials. It aims to half the proportion of untreated wastewater and substantially increase recycling and safe reuse globally.
- Access is directly related to SDG 6.1 and 6.2. Target 6.1 is focused on achieving universal and equitable access to safe and affordable drinking water for all. Target 6.2 is focused on achieving access to adequate and equitable sanitation and hygiene for all and ending open defecation, paying special attention to the needs of women and girls and those in vulnerable situations.
These water stress dimensions are not interchangeable. Businesses are expected to address the dimensions they impact in water-stressed basins that are contextually relevant through prioritization and sequencing. WRC companies are working with technical partners and NGOs, as well as using tools, such as WRI’s Aqueduct, to help identify and prioritize their water-stressed basins.
Recognizing we can’t do it alone: A call for collective action
The final principle that makes NPWI a comprehensive endeavor is that an enterprise can only achieve NPWI through a combination of investments in its own operations and through collective action partnerships within basins.
The ultimate purpose of NPWI is to increase basin resilience, especially within the challenging conditions of climate change. Getting to water positive impact will certainly require companies to excel on water management within their direct operations, but internal efforts alone will not be enough to face this daunting task.
Because NPWI is a shared ambition, investment outside company walls can unlock synergies for scale, and the NPWI journey becomes a pathway for large-scale collective actions. It is through joint action that basin risk can be addressed successfully, increasing climate adaptation and resilience at the needed speed and scale. Water Resilience Coalition companies are already acting collectively in over 11 basins in 5 countries around the world and moving towards achieving their shared goals.
As an industry-driven, CEO-led initiative, the Water Resilience Coalition aims to elevate the long-term mounting crisis of global water stress and its connection to climate change to the top of the corporate agenda. Its objective is to preserve the world’s freshwater resources through collective action in water-stressed basins and ambitious, quantifiable goals. Today, the WRC gathers 28 corporate members (representing over US $3.5 trillion in market capitalization) and 15 partner organizations that work towards water resilience in 100 basins globally and 300 million people with climate-resilient WASH by 2030.
The road ahead
NPWI is also a journey that starts with an orientation around water security in alignment with SDG 6 and will eventually evolve to resilience. The CEO Water Mandate is already working to pilot its Water Resilience Accounting Framework (WRAF) to strengthen NPWI by integrating systemic thinking into considerations to face future climate induced water shocks and stresses and prevent greater impacts.
As these journeys develop, the NPWI concept will also evolve. An initial next step that will be tackled during 2022 is helping companies include their supply chain impact if it is where their largest impact lies outside of direct operations.
All Water Resilience Coalition companies have pledged to achieve full NPWI by 2050. And every company will have a unique journey getting there.
World Water Day 2022 is an opportunity for companies who recognize the unique position they are in to have tremendous positive impact on water targets. If you are ready to set a more ambitious commitment focused on bold action to increase basin resilience and support the needs of communities, the environment and businesses, joining the Water Resilience Coalition is a step in the right direction. Find more information on how to join here: https://ceowatermandate.org/resilience.
Companies moving to achieve NPWI will have a robust system in place to understand their water-related impacts and risks, and to find solutions both internally (operations) and externally (basin-wide collective actions) to address them. To increase water resilience is to increase operational, community and environmental resilience – it is good business and an ambition we can all share.