Why 7 Large Food Companies Are Re-Thinking Their Water Practices

October 25, 2016
by Steve Holt for Thrive Market
Why 7 Large Food Companies Are Re-Thinking Their Water Practices

The World Economic Forum identifies water crises as the third “most impactful risk” facing the planet with shortages capable of causing food insecurity, mass migration, and political instability.

Agriculture uses 70 percent of the world’s water, meaning large-scale food production may play an outsized role in one of Earth’s scariest threats. Worst of all, according to sustainability nonprofit Ceres, two-thirds of food and beverage companies are not looking at water risks in their agricultural supply chains, which is where most water-related impacts occur.

That may be changing. On October 16, World Food Day, seven large food and beverage companies announced that they’ll be spending the next seven months analyzing their own water practices—including their supply chains—after which they’ll set out to make measurable and time-bound commitments to making improvements to address their findings. The companies partnering with the World Wildlife Fund and Ceres on the AgWater Challenge are Diageo, General Mills, the Hain Celestial Group, Hormel Foods, Kellogg Company, PepsiCo, and WhiteWave Foods.

Committed to making a difference

What are these companies committing to do? A lot. PepsiCo, for instance, will work with its direct agricultural suppliers in high water-sourcing areas like India and Mexico to improve water efficiency by 15 percent by 2025. And Hormel committed to developing a comprehensive water stewardship policy that holds its animal growers and feed suppliers to certain water management expectations—a meat industry first.

“Major food brands can be a powerful and constructive force for scaling water stewardship, especially at the farm level where the biggest footprint is by far,” said Brooke Barton, Senior Director of the Water and Food Program at Ceres, in a statement. “These brands recognize the material financial impact that water risks pose to their business, from supply disruptions, to higher operating costs, to growth constraints. More than ever, companies are responding to these supply risks through farmer incentives, local partnerships, and bottom-line reductions.”

Awareness is the first step

Last year, Ceres analyzed the water usage of 37 packaged food, beverage, and meat and agricultural companies, grading them on a 100-point scale for how they’re managing their water risks. While some companies were strong in awareness and planning around water usage, many were not. Specifically, besides the two-thirds that are not evaluating water risks in their supply chains, nine out of 10 don’t offer financial support to help farmers grow food more sustainably, and nine out of 10 have not set goals to source all major crops using responsible water practices.

Next year’s report from Ceres will evaluate how well the brands participating in the AgWater Challenge adhered to the commitments they announced this month—the hope being that these initiatives will create a cascade of sustainability work in the food and beverage sector.

“The challenges facing our company and our planet are more pressing than ever, so we have to build resiliency in our supply chains to ensure that we can continue to serve the world by making food people love,” wrote General Mills’ Chief Sustainability Officer Jerry Lynch. “Our ambition through the AgWater Challenge and all of our water initiatives is to lead by example and we hope to encourage others to do the same.”

Photo credit: Matt Benson via Unsplash

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