A new report from US-based sustainability advocacy organisation Ceres is calling on big food companies to “use vanishing water resources more efficiently”.
The non-profit organisation, based in Boston, Massachusetts, has revealed improved ‘scores’ in water management practices from major food businesses such as Mars and Unilever but has found “insufficient corporate action overall in an increasingly water-stressed world”.
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Ceres is urging food companies to adopt stronger practices to reduce their demands and impacts on water resources and said it is in their own interests to do so.
“Food companies are also among the first to feel the financial heat of climate change, as rising average global temperatures and shifting weather patterns make fresh water scarcer and agricultural production more volatile,” it said.
“For an industry that uses more than 70% of the world’s fresh water to grow crops, feed livestock and process ingredients, these are undeniable threats.”
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In Ceres’ Feeding Ourselves Thirsty report – described as a benchmarking report and investor tool – it notes the intensifying effects of climate change are placing an unprecedented strain on water resources and agricultural productivity, hampering the growth prospects of the global food sector.
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By GlobalDataThe report ranks the 40 largest global food companies based on their management of water risks in their operations and agricultural supply chains. This is the third edition of the report since 2015, allowing companies to view their progress over time.
Brooke Barton, vice president of innovation and evaluation at Ceres and co-author of the report, said: “Growing and processing the food we eat is a thirsty business, consuming more than 70% of the world’s increasingly strained water resources.
“Yet, as our report reveals, the C-suite still views water as a cheap and limitless input, ignoring its central role to the profitability of their business.”
Barton said Ceres is “encouraged by the growing acknowledgement of water risks and believe any action taken to advance internal water risk management is a step in the right direction,” but warned “a long path lies ahead for many of the industry’s largest water users and polluters”.
The top scoring food company in the report was Anglo-Dutch consumer goods giant Unilever, up 14 points from 2017 with a score of 87 out of 100. It is followed by two other packaged food companies, Switzerland’s Nestle in second place with a score of 85 and General Mills of the US with a score of 77.
Mars was the most improved company across all categories, increasing its score by 27 points since 2017.
In the meat category, Smithfield Foods of the US topped the table with a score five points up from 2017 but meat companies performed badly overall – it remains the lowest performing industry – with US-based chicken heavyweight Sanderson Farms bottom of the overall table with a score of 0.
Ceres said: “Beef, pork and poultry processors continued to disclose relatively little about how they plan to mitigate physical, regulatory and reputational risks stemming from climate change, water scarcity and water pollution.”
just-food has asked Sanderson Farms for a response.
Overall, the report highlights some “significant improvements” in key areas including board oversight of water risks and strategies, establishment of water use or efficiency targets for operations, as well as assessment of water risks beyond just their facilities to the agricultural supply chains.
But the analysis also found that, despite 77% of companies in the report specifically mentioning water as a risk factor in their financial filings, effective management of water risk still lags, with an average overall company score of 38 out of 100.
Petra Meekers, global head of sustainable sourcing at Unilever, said: “We are proud of the progress we have made over the past two years, but there is always much more to be done and we cannot succeed without accelerating collective action. Global corporations have an important role to play in making agricultural supply chains more resilient, including finding ways to support farmers to use water more efficiently and sustainably.”
Barry Parkin, chief procurement and sustainability officer at Mars, said: “We continue to look for ways to minimise our footprint in water-stressed areas and appreciate the recognition in this year’s Ceres report as the most improved company.”
