Water, water, everywhere, and not a drop to drink, or should it be “not a drop to fill the coffers of business?” That is the question looming menacingly over the business horizon.

“Dwindling water supplies are a greater risk to businesses than oil running out” a 2009 report for investors has warned (https://www.theguardian.com/environment/2009/feb/26/water-drought). This is still true today, so what does this mean for you?

No one foresees the day when this situation will happen, but the way things are, it is a distinct possibility. Water is one of our most critical resources, and Slovenia has deemed it a basic, constitutional need. The impact of water-scarcity is being considered not only in terms of biological needs, but as a harbinger of negative impact on businesses and industry. As of today, we already witness decreases in water allocations and more and more stringent regulations and expenses for water-usage, both of which impact a company’s bottom line.

There are no substitutes for water, and in its greed, the human race has just been squandering away nature’s largesse. We should all now be aware of the stresses imposed by water shortage and their causes: population explosion, climate changes, environmental disregard and hazards, and the unchecked usage of this critical commodity. Businesses that had hitherto been riding waves of success could very well be staring doom in the face if they don’t adapt to the situation.

“The International Food Policy Research Institute (IFPRI) found that 4.8 billion people – more than half the world’s population – and approximately half of global grain production will be at risk due to water stress by 2050 if status quo, business-as-usual behaviour is followed” (http://growingblue.com/water-in-2050/).

Industry and businesses will find it impossible to keep their footing in a scenario of fast-dwindling water resources, which is ironically, a situation partly of their own creating. Among those most at risk are high-tech companies, especially those using huge quantities of water to manufacture silicon chips; electricity suppliers who use vast amounts of water for cooling; and agriculture, which uses 70% of global freshwater, says a study commissioned by the powerful CERES group, whose members have $7tn under management. Other high-risk sectors are beverages, clothing, biotechnology and pharmaceuticals, forest products, and metals and mining. In short, there is no business that doesn’t have a dependency on water and can justly claim immunity from the water-strained future. Neither can any facet of life, for that matter; business, industry, agriculture, development, humanity, are all interlinked hoops, and the entire cycle – our entire world – is water dependent.

Keeping this bleak outlook in mind and the latest buzzword being “blue”, glad tidings are in the offing. The Corporate world is investing in innovative technology that initiates processes for conserving, recycling, and even extracting fresh water from salt water. However, the flip side presents a grim picture. “Water-use efficiency improvements may slow down the growth in water demand but, particularly in irrigated agriculture, such improvements will most likely be offset by increased production, and subsequently more strain on water-resources. Similarly, water storage and transfer infrastructure improve availability, but allow further growth in demand as well. Climate change will probably increase the magnitude and frequency of droughts and floods. The expected increase in climate variability will compound the problem of water scarcity in dry seasons by reducing water availability and increasing demand, the latter owing to higher temperatures and the need to make up for lost precipitation” (http://www.nature.com/nclimate/journal/v4/n5/full/nclimate2214.html).

Water scarcity and the alarming growth of water pollutants will pose a physical risk to business by affecting their operations. Increasing regulation is highly likely to slow down net profitability, and force businesses to either resort to shortcuts or cut down on their water usage. Media also plays havoc, bearing down on companies that collude in water wastage. Even companies in water-rich areas will be affected because their global networks, social media and the speed of global communication. Almost 22% of water consumption and pollution the world over is linked to the production of export commodities. So how can we truthfully insist that one country is affected while another is not?

Looking at the near future, many companies should be developing response mechanisms, but is it too late? Again, all these efforts might just be in vain if governments don’t back up efficient and clean water usage with effective policy.

If the global future of business is to remain a positive, productive and profitable, it’s time for a rude awakening, for if we don’t do something about water now; there will be no water. With no water, businesses can’t run. Taking a leaf out of Dow Water and Process Solutions, we need to make every drop count, and commit to putting each drop to the greatest potential use (https://www.greenbiz.com/blog/2014/08/04/10-companies-innovating-water-making-waves-water-innovation). No industry can be an island (excuse the pun), but in the very near future they could be part of a very large wasteland.


This blog, written by Pradeep Bandi, was originally published under Unlocking Foresight Know-How CIC blog dated 3 January 2017