Citing a potential 40 percent gap between water resources and water needs by 2030, the U.K. based organization Carbon Trust has issued a new report highlighting water risk issues for business with the attention-getting pitch “adapt or die.” Though somewhat alarming, the turn of phrase is timely here in the U.S., where the West Virginia chemical spill in the Elk River and the North Carolina coal ash spill in the Dan River have dramatically illustrated the consequences of lax regulation and fossil fuel dependency.
The report is also timely for U.S. businesses because a new Ceres report on fracking and water risks has turned up the heat on water resource issues.
Rather than dwelling on risks, though, the Carbon Trust report is all about solutions and opportunities, as you can gather by the title “Opportunities in a resource constrained world: How business is rising to the challenge.”
The Carbon Trust report
The Carbon Trust report aims to make the case that investing in sustainability is a sound business decision, by profiling four companies that it has been working with: leading U.K. hospitality company Whitbread, communications company BT, public transportation specialist Stagecoach Group, and Bord Bia, the Irish Food Board.
One key common denominator among the four is fairly obvious: generating a footprint that enables businesses to find opportunities for improvement in their operations and supply chains.
What’s really intriguing, though, is the report’s discussion of factors that motivate a business to make the jump to action.
Key drivers for sustainability action
Carbon Trust identifies several motivating factors that come into play.
One is competitive differentiation, in which companies leverage their environmental credentials to strengthen and identify their brands. You can see the ripple effect of this in the wind power industry, for example, where consumer surveys indicate a preference for green-branded products in support of the WindMade initiative.
Relatedly, leadership is an important factor for companies that want to establish a high profile position in their industry, with a strong tilt toward building an ethical reputation.
Carbon Trust cites Chris George, Whitbread’s chief of Energy and Environment, to underscore the point that carbon reduction is only part of the equation:
As consumers become more discerning it’s not enough to do the bare minimum when it comes to sustainability…. The consumer of 2014 is as likely to identify water, waste and depleting resources as carbon when talking about sustainability.
A comprehensive understanding of and engagement with all of these issues should therefore be a crucial part of any business’s core strategy …
A third group consists of the direct cost, efficiency and value creation potential of investing in sustainability.
The importance of pioneering
In particular, the leadership factor brings up an interesting angle reflected in the Carbon Trust’s four case studies.
As the Carbon Trust sees it, there is a great deal of untapped potential in convincing companies that sustainability investment can be a pioneering endeavor rather than simply a reaction to current events:
…the majority of businesses do not see sufficient value-at-risk or new business opportunities emerging from sustainability considerations to motivate real action. In the Carbon Trust’s own research only 5 percent of companies surveyed saw their response to sustainability as that of a global pioneer. By contrast 40 percent of companies saw their response to sustainability as reactive.
We’ll venture a step beyond that and say that a pioneering spirit can only take you so far, as clearly illustrated by the growing pile of recent fossil fuel-related water disasters in the U.S.
In order to secure a long term, sustainable future, sustainability leaders in the business community will be compelled to fight for stronger protections for water resources than currently exist.
Image (cropped): Courtesy of the Carbon Trust.