WASHINGTON, May 7, 2015 – Do you wonder how effective the companies providing your food are at managing the use of water? Ceres, a nonprofit sustainability group, has issued a report ranking 37 major U.S. food companies on their use of limited global water resources.
The report, “Feeding Ourselves Thirsty: How the Food Sector is Managing Global Water Risks,” benchmarks packaged food, beverage, meat and agricultural companies on a scale of one to 100 on how they are managing freshwater supplies. It also provides recommendations on how the organizations can improve water efficiency.
The report names companies taking action to manage water risks in their operations and supply chains, but concludes most “have a long way to go in using water more sustainably.”“The twin challenges of global water scarcity and pollution are contributing to a water availability emergency that threatens the profitability of food companies and long-term food and water security,” said Brooke Barton, senior water program director at Ceres and the report’s co-author. “The good news is that more food companies are beginning to respond to these risks, but they must deepen and broaden their efforts, especially in regard to agricultural supply chains.”
The report lists organizations by industry and found packaged food and beverage companies scoring much higher in managing water resources than meat and agricultural product companies.
The top companies by category and their scores are:
-- Packaged Foods: Unilever (70 points)
-- Beverages: Coca-Cola (67 points)
-- Meat: Smithfield Foods (38 points)
-- Agricultural Products: Bunge (29 points)
In a media release, Ceres says the report “makes clear that escalating water competition, combined with weak government regulations, increasing water pollution and worsening climate change impacts, is creating unprecedented water security risks for the food industry.” It mentions the estimated half-million acres in California fallowed by drought, as well as similar risks in other major growing regions, such as Brazil, Mexico and China.
In a media call, Jay Famiglietti, professor of Earth System Science at University of California-Irvine, and the senior water scientist at NASA's Jet Propulsion Laboratory, said, “Food production is the most water-intensive business in the world.”
This effort uses 70 percent of the Earth’s freshwater supplies, the report says. It points at surface water pollution from fertilizers, manure and pesticides as contaminants.
In its research, Ceres found that although many companies identify water risk as a corporate governance policy, board oversight doesn’t always translate into strong overall performance.
The report says 60 percent of big food companies don’t evaluate water issues in their agricultural supply chains, 89 percent haven’t set goals to source all major crops using responsible water practices, and 89 percent don’t offer financial support to help farmers grow food more sustainably.
“Farmers can’t do it alone,” Barton said.
The study found that only six of the 37 companies, or about 16 percent, had sustainable agriculture policies addressing water and only four offer financial support to help growers farm more sustainably. Some offer premiums for more sustainably grown inputs and favorable terms or interest-free loans for equipment.
General Mills was in both of these groups.
“As a global food company, we recognize that conserving water resources is imperative to our business: our consumers, customers, farmers and operations,” Ellen Silva, senior manager of applied sustainability at General Mills, said in a media call. “Water is a complex issue that spans communities, agriculture and industries, so in order to achieve progress, collaboration will be critical. We hope that this report can be a call to action for other companies to assess their water risk as well, and to join in that collaboration.”
According to Silva, water resources have been important to General Mills since it built its first flour mills 149 years ago on the Mississippi River.
The Ceres report provides the following recommendations for companies to improve water efficiency and water quality across their operations and supply chains:
-- Increase board oversight and understanding of material water risks.
-- Conduct robust water risk analysis from manufacturing facilities down to the farm field.
-- Address watershed-level risks by investing in projects that improve watershed health and by supporting public policies that ensure sustainable water management.
-- Work with farmers to tackle water risks and impacts in agricultural supply chains.
-- Improve disclosure to investors and other stakeholders on water risks, performance and management plans.
For more information and to learn how other food and agriculture companies fared in water management, see the report.
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