Preparation of your PowerPoint Presentation

• Pick and choose which slides you want for your

presentation

• Think about which questions you want to ask your

audience (to inspire you, more questions are offered in
the last slides)

• Contact WBCSD if you want any of the photos in

higher resolution: info@wbcsd.org

Please note that this is a Working Document!

Version January 2007
Business in the world of water
 Sample Agenda, e.g. 10:00 – 12:00

10:05 – 10:15 Water & Business: an overview – Ms. X,

Company X

10:15 – 10:50 Context and Presentation of the Scenarios

10:50 – 11:20 Breakout discussions in 3 groups

11:20 – 11:30 Feedback from each group

11:30 – 11:40 Water & Scenarios within Company Y – Mr.

Y, Company Y
11:40 – 12:00 Q&A and Close
 Objective of this Session

Understand water-business links

…by using scenario framework as a tool

 World Business Council for Sustainable
Development (WBCSD)

Business Cannot Succeed in a Society that Fails

• 190 global network of international companies

• WBCSD objectives include:

– Business Leadership
– Policy Development
– The Business Case
– Best Practice
– Global Outreach
 Freshwater Stress is Increasing…
Faster than Expected
How much water will be withdrawn with respect to the amount that is naturally available?

---- 2005
 Water Risks to Business

• License to Operate
• Climate Change Droughts Stranded Assets
• Increased Production Costs and Interruptions
• Community and Regulatory Pressure
• Health of Employees
• Brand Image
• Limitations to Growth of Consumer Markets
Introducing the WBCSD Water Scenarios
 Objectives in Building these Scenarios

Promote mutual
understanding

Clarify and enhance

understanding by
business …and support effective
business action
WBCSD Water Program – Core Team

19 Leading multinational companies in diverse sectors:

• Oil and gas

• Food and beverage

• Mining and metals

• Consumer products

• Environmental & engineering consultants

• Financial
WBCSD Scenario-Building Process
Introducing Scenarios: Learning from the Future
Understand the Scenarios yourself…
Reflect on how you could use them in your
company
Scenarios for Better Strategies…

• Strategy is about
what we ‘should’ do

• Scenarios explore
what ‘might’ happen
 Scenarios versus Forecasts

The Present The Path The Future

FORECAST

Current Multiple Alternative

Realities Paths Future Images
(mental maps)

SCENARIOS
 What are Scenarios?

X 
Predictions Credible
Projections Challenging
Preferences Coherent

…stories describing paths to different futures,

that help us make better decisions today
Introducing the WBCSD Water Scenarios
Complex Interplay of Local and Global Influences…
Three Parallel Stories

Post-its for ideas on dilemmas

and business actions
Key Story Themes
 Hydro
More drops, more value per drop
China ranks fourth in the world for
renewable water resources, but
because of its large population, it
has only 1/4 of the global average
of water per capita.

ics
s p
i ti e lym
C O
e g a
t he s
M of n itie y
e w m
or do tr u o
M a p o on
a n d Sh O
p Ec
e r o
o re th ge d
M In Hu Hy

2005 2010 2015 2025

 Unlocking Legacies of the Past
Photo: Naval Safety Center
 Efficiency

Over the last two decades, Eskom has introduced

a number of innovative technologies to save
water. These include dry cooling, desalination of
polluted mine water for use at the power stations,
etc. In doing so, more than 200 million liters of
water are saved every day. E.g.: Dry cooling
technology uses about 15 times less water than
conventional wet-cooled power stations.

© Unilever
Photo:
 Rivers
Security for all… in terms of quality and quantity

« Water management is, by definition,

conflict management. »
Worldwatch Institute, 2005

s
t h ip
c i rs
fi i t e
De e f i c
a
tr n
ir ty t D l P
u a
e c us o c
S Tr L

2005 2010 2015 2025

 Redistribution Challenge

Domestic: 8%

Agriculture: 70%

Industry: 22%
 2-sides: ‘Haves’ and ‘Have-nots’
Photo: © International Federation of Red
Cross and Red Crescent Societies

Aug 2006: Kerala, India ban on Coke and PepsiCo products after Centre for Science and
Environment said they contained unsafe levels of pesticides. Six other states in India
prohibited sales at or near schools, colleges and hospitals.
Sep 2006: Kerala ban lifted by an Indian court due to inconsistencies in the group's analysis.

‘Coca-Cola India has always been completely confident of the safety of its soft drinks in India
because they are produced to the same level of purity, regarding pesticides, as the EU
criteria for bottled water (globally accepted as one of the most stringent in the world).’

Sep 29 2006 The Coca-Cola Company statement, www.coca-cola.com

 Ocean
Accounting for the whole system
Approximately 37% of the global
population (over 2 billion people)
lives within 100 km (60 miles) of a
coastline.

c e
nt n
e s
m
e rna
nc e e
u e ov ov
s e q
r M
a lG
n e s b
Co at ri nt lo
rW t p G
ed a i o o e d
e nd l F
rF o rk
n t b a te t w
i lo a
Un
G W Ne

2005 2010 2015 2025

 Virtual Water – to produce one kilogram of…

Estimated water use

by life cycle stage (%)
Unilever, 2005

1,300 3,400
15,500
liters liters
liters
Unintended Consequences
 Three Different Futures Could Unfold…

a lu e of water e solutions
e e c o nomic v for innovativ
enabl tunity
States market oppoirency
Global gains in effic
Rapid

2006 Social tensions/conflicts and rivalries over water increase

Legal and moral liabilities about access and responsible use flare
National security interests inhibit progress towards IWRM..
Local solutions sought

Climate
Impact chan ge imp
s
Securit o f historica acts accele
Accouny through inlt water overdrarate….
tability e
for ‘virtrdependencyts & ecosystem
f
ual’ wa
ter us emphasised changes ma
es/impa nifest
c ts emp
h asised
 Breakout Discussions – 3 Groups (30 minutes)

Group 1 Group 2 Group 3

• What are the key dilemmas in Hydro/Rivers/Ocean?

• What actions do you recommend to deal with them?

• Learn & share

• Report back
For your Company, is Water a…
What are you going to
drink for lunch?
 Take Home Question

Considering the scenarios as a set, what do you

now think are the biggest risks and opportunities
for your business’ operations, investment
decisions, products, or services in an increasingly
water-stressed world?
“These scenarios highlight the
complex interrelationship between
water, energy and food security and
the need for a holistic approach to
water management.”
Jeroen van der Veer, CEO of Shell
EXTRA SLIDES
 Objectives in Building these Scenarios

• Clarify and enhance understanding by business of

the key issues and drivers of change related to water.

• Promote mutual understanding between the business

community and non-business stakeholders on water
management issues.

• Support effective business action as part of the

solution to sustainable water management.

Core Team:
19 leading multinational companies in diverse sectors:
Oil and gas / Food and beverage / Mining and metals / Consumer products
/ Environmental & engineering consultants / Financial / Water services
 Key Stages in the Scenario Process

Jan-Sept 2005 Oct 2005 Jan 2006 2006

Scenario
Orientatio Affirmation Application
Building
n

Interviews Synthesis Test plausibility, Sector

challenge, strategies
Workshops: Framework relevance
-Panama Business
-China Narratives Ownership awareness
-Switzerland
Focused analysis Communication Wider
Research advocacy
Drafting
New Initiatives

Collaborative
action
 Hydro
More drops, more value per drop

2005 – 2010: More and More Mega Cities

• Consume more and more water, leads to increasing water

stress

2008 – 2010: In the Shadow of the Olympics

• Positive press coverage ignores increasing tensions between
rural & urban (preferential treatment to urban and industrial)

2010 – 2015: Huge Opportunities

• China opens up its market to outside companies in attempt to
bring best technologies; 5-yr plan to 2015, business is active
participant

2015 – 2025: Hydro Economy

• China is spinning its water cycle faster “more value/drop” –
Chinese solutions on global market take many by surprise
 Hydro
More and more mega-cities & secondary cities

• Consume more and more water, leads to increasing

water stress
• Unsustainable water demand: impossible to treat
wastewater treatment by 2020, leads to industrial spills

s
i ti e cs
C pi
g a m
e ly
O
M he
e t s
or of n
ti ie
m
y
M ow tr u o
n d ad o on
a Sh pp Ec
e O
r t he ge dro
o In u Hy
M H

2005 2010 2015 2025

 Hydro
Beijing Olympic Games 2008

• Positive press coverage doesn’t look at increasing tensions

between rural & urban (preferential treatment to urban and
industrial)
• Shortly after Olympics, water-related incidents gain international
attention, e.g. car parts plant shut down due to over-extraction of
groundwater
ics
p
lym
s O
Citie
t he
eg a of s
e
M ow ti ie y
or ad tr u
n
om
Sh on
M o
an
d pp Ec
e O
ro
or
e th ge d
M In Hu Hy

2005 2010 2015 2025

 Hydro
Huge Opportunities
• 2012 instead of single way forward, China embarks on period of economic
experimentation… government promotes innovation and supports best-in-class
technologies & water management policies. China opens up its market to outside
companies in attempt to bring best technologies.
• When develop 5-yr plan to 2015, business is active participant

China ranks fourth in

the world for
s i cs renewable water
p
itie lym resources, but
C s
itie
a O
g he because of its large
e t n
e
M of tr u population,
y it has only
or ow o m
M ad p p ono of the global
1/4
d
an Sh O Ecaverage of water per
or
e th
e ge o
dr capita.
M In Hu Hy

2005 2010 2015 2025

 Hydro
Hydro Economy

• China is spinning its water cycle faster: same amount of water used more
often “more value/drop”
• By 2025: China known worldwide for cost-effective water solutions of all
scales
•Ageing infrastructure in Europe: Chinese solutions on global market take
many by surprise – those companies involved early got the advantage

s i cs
p
itie lym
C O
a
eg
th
e s y
e
M of ti ie o m
on
or n
ow tr u
Ec
M ad o
an
d h pp
e e
S O r o
or th ge d
M In Hu
Hy

2005 2010 2015 2025

Photos: Naval Safety Center, www.safetycenter.navy.mil
Unlocking Legacies of the Past
Unlocking Legacies of the Past
Rebound effects –
what you do with the energy you’ve saved
 Rivers
Security Deficit

• By 2010, low-income and emerging economies

often lack safe drinking water – but if they want
clean water, they have to pay for it
• This leads to rich getting richer and poor getting
poorer – citizens distrusts governments
• Also in developed world, old water systems
results in greater costs – in 2015, for the 1st time,
middle-class households struggle to pay for water
bills

c i t i ps
fi sh
De er
t
if ci tn
ir ty ar
De P
cu st cal
S e Tr
u
Lo

2005 2010 2015 2025

 Rivers
Trust Deficit

« Water management is, by • Increase media coverage – increased

definition, conflict
management. »
Worldwatch Institute, 2005
pressure on EU and US companies that operate
in developing countries: taking water from poor
for industrial, manufacturing or agribusiness use,
which leads to boycotting
• But many governments use water policy as a
way of asserting the right to deny access.

i ps
if ci
t i t rsh
fi c tn
e
De e ar
ity t D P
cu
r s cal
u
Tr Lo
Se

2005 2010 2015 2025

 Rivers
2-gether

• Business understands water security is not only

efficiency & technology, but also policy – form public-
private partnerships, PPP’s: the more business
participates in helping shape water policy, more likely
ensure own needs
• By 2010, recognize that water security closely tied to
energy security (& food, & health…): energy needed for
water, water needed for energy

s
h ip
t e rs
if ci t tr n
De if ci a
ity De l P
cu
r
st c a
Se Tr
u
L o

2005 2010 2015 2025

 Rivers
Security for all… in terms of quality and quantity

2005 – 2015: Security Deficit

• Low-income and emerging economies lack safe
drinking water – if they want clean water, they have to
pay for it

2010 – 2015: Trust Deficit

• Increase media coverage – increased pressure on EU
and US companies that operate in developing countries

2015 – 2020: Local Partnerships

• Increased number of PPP’s, business help shaping
policy
Security Deficit
 Ocean
Accounting for the whole system

2005 – 2015: Unintended Consequences

• Asleep at the water wheel – more conferences, little action
• Floods continue because of mismanagement of climate change and
mismanagement of ecosystems, deforestation in Asia, Rhine delta is
under pressure

2010 – 2015: Global Fair Water Movement

• « Need global standards to guarantee right to clean water for all
humans on planet »

2015 – 2020: Water Footprints

• Drive for bio-fuels in Southern Europe increases pressures on scarce
water resources – companies start to report on their water footprint

2020 – 2025: Networked Global Governance

• Companies with large water footprints engage in virtual water trading on
basis of fully priced externalities - emergence of water-based economic
zones
 Ocean
Unintended Consequences & Fair Movement

• Lulling to sleep & Floods continue

• 2010: Africa & L. America complain that water is being used by rich-country lifestyles
• Large international food company – outsource growing & processing of chickens to
Brazil – Brazilians suffer from exporting precious water while locals suffer shortages
• 2015: 5 confirmed cases of cholera in London: energizes Global Fair Water Movement

n t
e s e
nc e m ce
ov
e n
u rna
e q M e
s e r ov
n at G
Co ts bal
e d i rW p
ir n G
lo
d F a ot ed
en a l F o rk
i nt b ter tw
o
n lo a
Ne
U G W

2005 2010 2015 2025

 Ocean
Water Footprint

• 2010 – companies report total

Approximately 37% of the volume of water used directly or
global population (over 2 indirectly (total accounting) (need
billion people) lives within tools)
100 km (60 miles) of a
coastline.

t n ce
es en rna
en
c em e
u ov
s ov
eq M t G
n s ter ir n bal
Co a t p lo
rW o o G
ed i F ed
d Fa r rk
t en al t e o
in b a tw
n lo Ne
U G W

2005 2010 2015 2025

 Ocean
Networked Global Governance

• 2020: companies with large water footprints

engage in virtual water trading on basis of fully
priced externalities - emergence of water-based
economic zones
• Need market mechanism & governments
through legislation: Europe, US and Asia address
true value of water & complete cycle – new laws e
n c
rna
e
es en
t
ov
en
c
v em
a lG
u o b
eq M lo
n s ter ts G
Co a ir n d
W p e
ded air oot rk
en al
F F o
in
t b ter t w
Ne
n lo a
U G W

2005 2010 2015 2025

Asleep at the Water Wheel – Flooding

© UN Photo/ Sophia Paris

Photo:
 Natural Phenomenon – Sea rise

Picture: © Food and Agriculture Organization of the

United Nations
Interconnected
 Key Messages

• Technology is only part of the solution.

• Relevant innovation is driven locally.

• Business cannot buy its way out of water problems.

• Creating trust helps to secure the license to operate.

• Anticipate risks that stem from outside your current

business model.

• Growing water issues and complexity will drive up costs.

 How do companies plan to use the scenarios?

• Test strategy (corporate, operations,

product?)

• Raise awareness of water issues

• Multi-stakeholder dialogue
Discussion in Groups – 30 minutes

Which legacies need to be unlocked to drive innovation?

Where else will cities face big water challenges?
What appropriate solutions can you see and reach?

What happens if the water ‘haves’ and ‘have not’ issues

are ignored?
What constitutes ‘fair water’ uses and who will decide?
How can water conflicts be avoided?

What happens when the ‘whole system’ isn’t taken into

account?
How can virtual water be made more transparent?
What are the tensions and trade-offs in managing water
resources and allocation at local and global levels?
 Extra questions for discussion on ‘H’ – Hydro
• Which legacies need to be unlocked to enable more sustainable water
practices and more appropriate solutions?
• Will further urbanization intensify the water crisis, or does it provide an
opportunity to find a solution?
• If the quality, availability, or cost of water for your suppliers, yourselves, or
your customers/consumers changed significantly (x2, x10) in the next 5, 10, or
20 years, how would your business be affected?
• How can businesses be encouraged to see water-related problems and
constraints as opportunities for innovation and value creation?
• What are the dilemmas raised by the multifaceted efficiency challenge (more
value per drop, more drops for less, less pollution and energy per drop, more
jobs per drop)?
• Which sectors will need to take the lead in partnering with municipal and
national authorities to ensure city solutions are agreed and implemented on a
sufficiently fast and large scale?
• Where else are governments and their societies likely to respond with market-
enabled solutions?
 Extra questions for discussion on ‘2’ – Rivers

• Whose water needs and what water uses will matter most?
• Will business be seen as a legitimate stakeholder in water allocation
discussions and disputes?
• Who might be new partners or stakeholders in judging your business
operations or in providing new and better solutions to grow your
business?
• Can all conflicts over water be avoided – and, if not, where will the
fracture lines first appear?
• To what extent can the legacy of corruption be overcome in water
management?
• How do we allocate water fairly for all users in a community, not just
the highest bidders?
 Extra questions for discussion on ‘O’ – Ocean

• To what extent can human and business activity adapt to new and
evolving constraints imposed by the ‘big’ – or hydrological – water cycle?
• Can you assess your water footprint? What measures do you have in
place to monitor water use? What do your competitors do? What is best
practice?
• How will formal institutional arrangements give a voice to the
ecosystem?
• When we solve a water problem upstream, how can we avoid
unintended consequences downstream?
• How can more investment be mobilized to finance new innovative
schemes for local water solutions?
 Business-focused questions
• How is your business dependent on water for its success today – upstream, midstream,
downstream?
• Do you know and understand your water supply, treatment, and disposal context? Do you know
the influential institutional and/or governmental individuals who deal with water in your business
community?
• Can you assess your water footprint? What measures do you have in place to monitor water use?
What do your competitors do? What is best practice?
• If the quality, availability, or cost of water for your suppliers, yourselves, or your
customers/consumers changed significantly (x2, x10) in the next 5, 10, or 20 years, how would your
business be affected? Do you consider water in your long-term strategic planning?
• What are the generic opportunities and threats in each scenario? Who is the prime mover – that is,
which organizations and institutions are setting the standard?
• Reading the scenarios – ask yourself not “whether”, but “what if” – how would your business be
affected if this future came true? Which aspects of each scenario are particularly relevant to your
products and services? What other water dimensions need to be added? Which water challenges
and opportunities seem most relevant to you as a citizen? A consumer? A businessperson?
• Considering the scenarios as a set, what do you now think are the biggest risks and opportunities
for your business’ operations, investment decisions, products, or services in an increasingly water-
stressed world?
• Who might be new partners or stakeholders in judging your business operations or in providing
new and better solutions to grow your business?