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The Business of Water

The world is dealing with a severe water crisis. Population growth and economic development continue to push water resources beyond natural limits, and demand will only continue to grow – projected to triple in the next 20 years. Yet, the earth’s water supply remains limited.

The positive news is that advancements in technology are helping address the global water issue, providing more access to clean water, and enabling industries and municipalities to recycle resources. We’ve seen individual companies, associations and municipalities step up, take the crisis into their own hands and enforce high standards for water safety. But we can no longer be independent water users.

Rather, we must continue to change today’s approach to water management through collective action from organizations, governments and individuals, in order to ensure a more prosperous and water-filled future. To shepherd in this new era of stewardship, industry and government must work closely together.

Step One: Organizational Action

Industrial and commercial manufacturers are the largest users of water worldwide. Obvious factors such as population growth, increasing regulation/industrialization and weather patterns are cited as increasing concerns negatively impacting profitability and economic growth. These unpredictable variables make it difficult to accurately calculate and plan for profitable water risk management.

Companies are turning to inventive ideas and tools to help them assess and respond to increasing water risk globally. Programs such as the Aqueduct Alliance, a consortium of private and public sectors, non-profits and academia, brings influential entities together to provide “unprecedented levels of water risk information for business and government.” The Alliance evaluates social issues including willingness and ability for governments to address water scarcity – leveraging new points of data for risk management.

This online tool allows companies, investors, financial intermediaries and public sector decision makers measure, map and respond to geographically explicit water risks and opportunities.






It works by quantifying multiple drivers of water risk that can be easily and transparently aggregated and disaggregated. A stand-alone tool, Aqueduct identifies hotspots of water risk that can constrain a company’s access to water, increase its costs and disrupt its operations. When overlaid with the locations of production facilities and/or key suppliers, these maps highlight the water risks a company is exposed to, while pinpointing where solutions are required.

Beyond Aqueduct, initiatives like WaterMatch – an innovative new, free online website dedicated to promoting beneficial reuse of municipal effluent for global industrial use– are a step forward in responsible water management, and in partnerships between industries and municipalities.

In addition to putting fundamental environmental best practices into place, industrial companies can take advantage of such programs. For instance, as part of its water sustainability program, Coca-Cola has developed a forum for government plants to evaluate water risk, providing reports on individual risk and educating companies on water consumption.

Step Two: Government Action

Governments must also take strong action to promote more water reuse and recycling. There are four well-documented, major types of policies currently in play around the world to increase this initiative:

  • Education and outreach efforts support recognition awards and certificate programs, information dissemination and reporting of water consumption, discharge and recycling data.
  • Removing barriers by revising plumbing codes and alleviating stringent permitting and inspection requirements for recycled water, allows companies and communities to meet obligations that were otherwise difficult to attain.
  • Incentives such as direct subsidies reduce government payments for the reintroduction of recovered water and provide regulatory relief for recycled water users through structured pricing mechanisms.
  • Mandates and regulations – through the requirement of water recovery systems and recycled water for certain large volume activities (e.g. irrigation) – continue to reinforce these initiatives along with the strong need for government participation.

Government involvement through regulation and policy is necessary to solving the world’s global water crisis. Coalitions that advocate for legislation focused on sustainable programs in support of water recycling are also critical. The WateReuse Association (WRA), as one example, supports the “Water Quality Protection and Job Creation Act of 2011” (H.R.3145), which aims to renew Federal commitment to addressing our nation’s substantial needs for wastewater infrastructure by investing $13.8 billion over five years through the State Revolving Fund and other efforts to improve water quality.

Solution: Collective Action

Government and industry alike compete for the same finite water resources, and as this supply rapidly dwindles, working together has never been more important. Governments must promote greater water recycling through fundamental frameworks, policies and incentives that define clearer regulations. Industries should also do more by implementing available recycling technologies – tapping into existing, under-utilized water resources. Through more creative, public partnerships among industries, communities, municipalities and government, we can protect and enhance performance and competitiveness, as well as the needs and interest of key stakeholders – the most important of which is our environment.

Future success depends on our ability to work together. New levels of efficiency must continually be enforced through education, conservation, governance and incentive. Understanding the risks – and the opportunities – will place businesses and governments in a more competitive position to lead and succeed in a carbon and water-constrained economy, and ultimately secure a future of water sustainability.

Jon Freedman is Global Government Relations Leader for is GE Power & Water, Water & Process Technologies.

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