water stewardship - cyphynets · 2019. 1. 28. · stewardship in lahore water stewardship pakistan...
TRANSCRIPT
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Water Stewardship
NameOffice/Departmentdd mm yyyy
20‐Feb‐17 / 1
Water Stewardship: Private sector water challenges
Stuart OrrWWF International
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These challenges will grow due to 3 megatrends
• Global population will peak at 9 B by 2050
‒ 65% of population and 1/3 of the land area in severe water stress
‒ 3 B additional people in cities
• Temperature increase ‒ Higher weather variability, less freshwater stored in ice, more droughts and floods
• Urbanization and rising incomes, especially in BRIIC countries
‒ Double irrigation for food demand
Our current global water challenges
• 41% of humans live in areas of severe water stress
• 1.1 B people lack access to safe drinking water, 2.6 B lack adequate sanitation services
• Freshwater species are declining the fastest (70% decline of Living Planet Index since 1970)
• Most industrial wastewater is disposed without treatment
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The World Economic Forum’s annual risk report ranks water crises as #1 global risk in terms of impact.
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‘Water crises’ on top of WEF’s 2016 ‘Top Five Global Risks of Highest Concern’ projection
‘Water crises’ in WEF’s ‘Top 5 Global Risks in Terms of Impact’ since 2010
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12
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13
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Water Risk
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Agri-business / Forestry Extractive industries Power generationWater industryManufacturing
(Consumer goods) Tourism and leisure Finance & insurance Retail
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Financial Risk
Physical Reputational Regulatory
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20 February, 2017 - 19
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• Stalling of planned power plants• Heavy opposition by other water users • Inflation in food and commodity prices• Expected adjustments of water allocation/regulation
• Insurance and Finance costs and concerns
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• NGO questions and awareness• Reputations in question• Investor warnings• Stewardship claims challenged• Dependence and risk recognised
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• Value at Risk• Investor warnings• Shareholder concerns• Higher costs to secure water• Legacy of bad interventions
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www.icmm.com
Major risk:• 23% cited drought • 55% cited flooding• $bn’s projects on hold
What is at stake?
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www.icmm.com
• Water infrastructure = 10% industry CAPEX
• US$3.4b (2009) – US$11.9b (2013), a 250% increase.
• Driving innovation, co-investment, shared infrastructure
What is at stake?
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20 February, 2017 - 25
What is at stake?
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Justiça bloqueia R$ 500 milhões da Samarco, Vale e BHP Billiton Brasil. O Globo, Fevereiro, 2016
What is at stake?
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Disclosing companies reported US$14 billion in water-related impacts this year, a five-fold increase from last year
Corporates are not moving fast enough: Year-on-year disclosures through CDP how that companies are not moving fast enough to address the sustainable management of water
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Citi ‘Water Worries: Climatic Consequences’
Credit Suisse ‘Water: The Paramount Megatrend of our Time’
Citi ‘The Growing Impact of Water Scarcity on Mining’
HSBC ‘GDP will be ‘severely hampered by water scarcity’
JP Morgan ‘Watching water: A guide to evaluating risks in a thirsty world’
GoldmanSachs ‘Water could be a constraint on growth’
Morgan Stanley ‘Water: The Perfect Storm’
Standard Chartered ‘Water – The Real Liquidity Crisis’
Merrill Lynch ‘Water scarcity a bigger problem than assumed’
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Water Stewardship
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Water Carbon
Chronic global shortages already exist Global impacts are slowly increasing
Clear physical and financial risks to business – not only reputations
Specific risks to business are harder to define
Solving water problems is a local issue Solving carbon problems is a global issue
No single international convention addresses water comprehensively
Addressed through UNFCCC
Shortages can vary disastrously from year to year
CO2 increases and decreases gradually
Meaningful solutions must be found in the watershed
Cap and trade carbon trading systems to address impacts
Confusion over response Confusion over measurement
Response is Stewardship Response is Efficiency
Why is water different from carbon?
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Water awareness
Knowledge of impact
Internal action • Private goods
• Direct control• Efficiency of resources• Products• Internal environment• Impacts
Collective Action
Influence governance
• Public goods• Indirect control• Allocation of resources• Places• External environment• Impacted
WWF Stewardship steps – Our Theory of Change
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Shared Risk
Corporate• Physical• Reputation• Regulation
Economic value
Government• Phy/bio‐physical• Social / economic• Institutional
Political
WWF• Bio‐physical• People• Governance
Ecosystem health
Shared risk and opportunity
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WWF Leadership on Water StewardshipBusiness Risk Water Footprint Agriculture Public Policy
Disclosure Investor Risk
Insurance Risk
Mining Risk Stewardship Water Risk Filter
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Water Response
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Matrix of water-related risks
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Examples of key Water Stewardship projects
Test AWS with farmers in the Western Cape with WWF- South
Africa
Alliance for WaterStewardshipWater Futures Partnership
Facilitate local action to address pressing water risks facing farmers, SAB, surrounding
communities and ecosystems
Support SME’s implement water stewardship in Lahore
Water Stewardship Pakistan
Drive ecosystem stewardship program to improve basin's
resilience
Mondi Wetlands Program
Reduce of EDEKAs ecological footprint and enhancement of the sustainability of leading German
food retailer
Drive collective action in the Taihu lake sub-basin of the Yangtze, notably through
industrial parks
Develop sustainable guidelines and criteria related to water risks
for credit/loans
Brazil
Raise awarenessand influence decisions and
policies inWater and energy
Several partnerships with global leaders in key sectors (F&B, textile, banking, mining, ag.,
retail)
Other partnershipswith global leaders
Edeka cooperation
Encuentro por el Agua
H&M collaboration in China
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Key Water Stewardship targets audiences for influence
FIs DFIs Industry associations and regulators
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What are companies doing?
• Very different levels of experience and engagement
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• Development of baseline data
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Number of production units
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20 February, 2017 - 44
2% ‐ 3% of GDP
10% of FEE
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25%maize
production7%
national fisheries
national herd
20% 90%
ZambianSugar
Hydropower production
50%
The Kafue Flats: Zambia’s Economic Engine
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Ganga basin - Kanpur Leather Cluster
Key Facts about Kanpur
• 12th Largest urban conglomerate in India (population ~3 Million)
• Home to more than 700 tanneries• Considered the most polluted stretch of the
Ganga river
Basin risks
• Heavy Metal pollution from Tanneries• Fast depleting groundwater resources• Urban sewage directly being discharged in the
river
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New Tannery Zone in Sialkot• New Tannery Zone under-construction in Sialkot• Soft Loans on low interest for investment on infrastructure
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Combined Effluent Treatment Plant in Faisalabad
• Investment in a CWTP near textile industrial cluster in Faisalabad
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Construction of Wetlands
• Construction of Wetlands in communities in Southern Punjab and Khyber Pakhtunkhawa (KPK) for improving access to clean water.
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Soft Loans – Green Credit lines
• SMEs committing to adopt Smart Environmental Management Plans will get soft loans from ADB.
• Low interest loans for green infrastructure in the tannery zone
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Stuart Orr – Practice Lead - Freshwater [email protected]