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The Business Case for Investing in Water and Hygiene

Words by 3p Contributor
Leadership & Transparency

Editor's Note: This post is part of a series on the theme of creating business value and development impact in the water, sanitation and hygiene (WASH) sector. The series and accompanying discussion paper are co-produced by Water and Sanitation for the Urban Poor and Business Fights Poverty.

By Neil Jeffery

For a number of years the concept of corporate social responsibility – or CSR – has been growing in significance. It is now widely recognized that companies have a responsibility not only to their shareholders, but also to the environment and to society as a whole. Many companies have responded by setting up dedicated CSR departments, often with a philanthropic function.

While these ventures remain worthwhile, in recent years a band of companies have shifted the goalposts toward something more ambitious: the possibility of mainstreaming CSR as part of a company’s core business, or going ‘beyond CSR.' In essence, this means that a company’s business and social aims become complementary, where business benefit aligns to social impact; in these cases the company’s social agenda is not handled separately by a specific department, but becomes integrated within the core business model.

So, what does this approach look like in practice? A leading example is Unilever, which initiated the business-led Toilet Board Coalition in 2012, and recently made a global commitment to help 25 million people gain improved access to a toilet by 2020. Unilever’s Domestos toilet academy program aims to stimulate demand for Unilever products, including the toilet cleaner Domestos, by helping entrepreneurs to set up new toilet businesses: Unilever’s rationale is that building the toilet market is good for people’s lives and good for sales. In fact, Unilever now believe that its ‘sustainability brands’ are outselling other brands and growing its market share at a faster rate.

As described in a recent series with Business Fights Poverty, we at Water and Sanitation for the Urban Poor believe that the water, sanitation and health (WASH) sector affords opportunities for companies to create business value and to generate lasting social impact at the same time – it is not either/or!

In the series, we featured perspectives from five multinational companies, each of whom recognizes the value to be gained from putting WASH at the heart of their CSR agenda, and we are grateful to all of them for their participation. The series is designed to showcase a broad spectrum of WASH-related initiatives: In addition to Unilever, we heard about Coca-Cola’s investment in water resources management through the Water Funds Partnerships; IBM’s development of an innovative mobile app that helps citizens to report water leaks; Diageo’s work to engage employees to deliver on water and other sustainability goals, through the company-wide GreenIQ scheme; and Marks and Spencer promoting the wellbeing of the local workforce, by providing better water and sanitation in the communities surrounding their factories.

The positive social impacts of these initiatives are obvious, but the business case is no less striking. Each company recognizes that it, too, stands to benefit through increased sales of WASH-related products and services, better workforce productivity, reduced cost and greater resilience in operations and supply chains, strong relationships with governments and other key stakeholders, and we could go on …

In following the series, we hope you get a sense of the breadth of industries for which the WASH sector provides a source of business value and development impact. In researching our new discussion paper that accompanies the series, we asked Business Fights Poverty to perform a mapping exercise of  key CSR initiatives relating to the sector; we were struck by the extent to which water, sanitation and hygiene issues were seen to affect virtually all companies, albeit in different ways and through different channels.

The push to achieve universal water and sanitation is a daunting one, but it can be achieved, and our research shows that every company can play its part. We hope you find the series inspiring!

This blog was previously published as part of a series on Business Fights Poverty.

Neil Jeffery is CEO of Water and Sanitation for the Urban Poor. 

3p Contributor

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