As many organizations rely implicitly on the use of water, risks associated with its use should be comprehensively assessed in order to assure sustainability. These risks can change from one particular industry to another and from one company to another, but they are invariably complex and tied to numerous different scenarios. In short, it’s not simply enough to question whether water will be available, as complex socioeconomic and political issues factor into the equation.
Every company relies on the cooperation and interaction with a large variety of different entities beyond its perimeters. In order to procure resources, this interaction needs to take into account many factors and when resources become scarce, visibility is essential.
The subject of water can be very emotive, because it is viewed as being finite and potentially scarce. Whenever we hear of drought conditions in the area, alarm bells start to ring. Conversely, electricity, another essential resource is not viewed in this light.
Companies must consider all the water risks: what should happen in the event of drought, or conversely what should happen if significant flooding events occur? Wherever water is sourced, how could regional events or other developments affect its availability? Such questions require in-depth knowledge of the area, a finger on the political pulse and a good understanding of the demographic.
When a company has many different branches in different locations, the relative strength of a regional government can be very important. Senior executives should take the time to get to know how these regional government teams are put together and try and predict how water related risks would be handled. What different scenarios could unfold?
Water affects everybody from the individual to the complicated corporation and as our climate changes, availability of water will undoubtedly change with it. This emotive subject is bound to galvanize politicians who are likely to come down in favor of individual consumers at the expense of a corporation. Could this result in potentially unfair legislation whenever any threat arises?
When assessing water risks, companies must also look at runoff and disposal issues. How is this potentially even more emotive issue likely to be handled? Environmental issues are to the forefront these days and any effect on the local ecology must be kept to a minimum.
There are so many potential setbacks, which could impact the water risk faced by a company. Challenges are likely to be raised and numerous “what if” scenarios should be explored, in order to justify a corporate position, when called.