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How Water Became the New Focus of Corporate Sustainability

Water crises in the West have pushed some companies to apply sustainability labels to their beverages, clothes and other water-dependent products. Kellen Klein, a senior manager at Future 500, helps sort through the claims.

Written by Matt Weiser Published on Read time Approx. 8 minutes
Charlie Arnold holds a container of non-potable water before it is treated, right, and after, left, at Stone Brewing Co in Escondido, Calif. In an effort to reduce water use, the brewery planned to spend $1 million on expanding its $8 million wastewater treatment system installed in 2008, and aims to use only three gallons of water for every gallon of beer it produces. The treated water is used to clean equipment.Gregory Bull, AP

Can a water-dependent product – beer, for example – achieve sustainability in its water use? And how should we evaluate such a claim?

Chronic water scarcity in the West has prompted a surge in examples of this kind of marketing. Companies that rely heavily on water have begun to test various “green” marketing strategies, just as companies have long attached sustainability goals to the air pollution they cause or the habitat they impact.

Beverage companies are claiming they’ve reduced their water consumption, neutralized it somehow, or even achieved some kind of net benefit in water supply through various kinds of watershed enhancement projects. Some are experimenting with using recycled wastewater in their products.

What is the right path for companies interested in these efforts? How should consumers react to these claims? Is it even possible to achieve sustainability in a water-dependent product?

To explore these questions, Water Deeply recently spoke with Kellen Klein, a senior manager at Future 500, a nonprofit consultancy that works to find common ground between corporations and environmental groups to solve global problems. Klein, based in Portland, Oregon, focuses on water sustainability issues, among other specialties.

Water Deeply: Have you seen more companies trying to package their water-related products as “green”?

Kellen Klein: I would say I have. If I were to theorize about why that is, I think it just stems from a broader societal awareness of water issues and challenges. The California drought has brought water supply issues – and water quality issues – into focus for both the general public and a variety of water-oriented NGOs and agencies. Companies are trying to capitalize on this recent narrative in the media.

But there have certainly been other events that have drawn that type of attention. The crisis with the public water system in Flint, Michigan, is one of them. Both of those issues catapulted water issues into the public dialogue and into political discussions as well.

Water and water infrastructure is one of those issues where there seems to be a bit more bipartisan support, which is exceedingly rare these days.

Companies also recognize it is critical to their brand, or their social license to operate. So they have recognized they need to focus on a wide array of water issues, similar to climate change or recycling. Water is sort of the next carbon, if you will, in terms of being a corporate sustainability calling card.

Water Deeply: Can you share some early examples of this in the corporate world?

Bottles of Fiji water rest on a shelf at Corky’s 12th Street Market in Cleveland in 2006. Fiji, popular with Hollywood celebrities, angered Clevelanders by poking fun at the city’s water troubles. Later, its claim to being the only “carbon negative” bottled water were debunked. (Tony Dejak, AP)

Klein: One that initially comes to mind is Coca-Cola [disclosure: Klein has worked on projects with Coca-Cola]. They made this pretty dramatic goal to replenish the water that goes into their bottles. They reached that goal three or four years ahead of time. And that has become a prominent communications point for them when marketing their products at a broader level.

Another going on for a while now is Levi’s, the maker of jeans and other clothing.Levi’s looked at the life cycle of their jeans; the most prominent use of water comes from producing cotton, but also a ton of water is used in the washing of their clothes. So they said, hey, this is a great opportunity for consumer engagement, and we need to take some action and do some education here. So they started an education program (Water-Less) to encourage consumers to wash their jeans on a cold setting, and to not wash them as often as a way of conserving water and energy.

One example of a company struggling with these types of positive commitments is Fiji Water. They claimed they were carbon negative, because their investment in carbon reductions were so significant. It turns out a lot of those projects were actually carbon futures that would not pull carbon out of the atmosphere for years down the road, and they ended up being sued over that.

Water Deeply: Do these claims of “replenished” water make a difference where the company tapped water for its products?

Klein: That is something we’ve heard NGOs and stakeholders look to as the next level of water stewardship. You can’t just use water or withdraw water for your product in one geography and invest in projects in an entirely different geography and consider it a net balance. Water is very context specific. It stays within a watershed, in general. So if you’re going to withdraw from a watershed, you need to replenish in that watershed.

Coca-Cola and others have partnered with Bonneville Environmental Foundation, which leads the Change the Course program, where they call on consumers to use less water. For every consumer who signs that pledge, the company will invest in projects that restore 1,000 gallons of water to critical watersheds. That’s an example where you’re engaging with your consumers, involving them in these emergency discussions around water stewardship and tying that back to many of the watersheds where your consumers are based.

Water Deeply: Does conventional green branding work for water, or does it pose unique challenges in the marketplace?

Klein: I think there are some things that make it easier and some things that make it harder. One thing that makes it easier is that water is tangible. People can understand the concept of water much more easily than they can understand the concept of climate change and energy or recycling and that complex supply chain. People need water every day, and that’s made it an increasingly compelling discussion topic for a lot of companies.

One of the major challenges is that water is so geography specific. For a lot of these big national or multinational companies, talking about water is something that is going to resonate more with others. It’s something that might resonate in one watershed and not in another. A company could make commitments to water conservation that really resonate in California. But in Washington state, where water is more bountiful, consumers might not care as much.

Water Deeply: The Costa Rican beer company Cerveza Imperial recently launched a “water positive” campaign in Colorado. Is that an example of this context-specific approach?

Klein: On the positive side, I think it’s a bold commitment. They’re withdrawing the water in Colorado, and making investments in water replenishment in Colorado as well.

Another thing I thought was positive was they are considering water use in their entire supply chain in calculating how much water they need to contribute to be water positive. That is particularly compelling in areas where other companies, including Coca-Cola, have been criticized. Coca-Cola’s program only factors in the amount of water that goes into the bottle, not the amount required to grow cane sugar, for example. Companies that fully factor in that complete life-cycle analysis when making any type of stewardship commitment – that’s where we’re going to see a lot of the market headed in the future.

More on the critical side, these types of commitments are inherently subject to a lot of scrutiny when it comes to the calculations. You’re going to have to make assumptions about how much water you are putting back into the watershed, and how you are doing that. Is restoring the health of a river somehow improving the water quantity for people? Is it based on how much an aquifer fills up from water refiling that basin? It can get really wonky, and that opens up a variety of criticisms.

Water Deeply: An Arizona partnership recently launched a project encouraging breweries around the state to make beer from recycled sewage. What do you think?

The Pure Water Brew partnership in Arizona is touring the state with this semi-trailer set up to demonstrate the use of recycled wastewater in beer brewing. (Photo Courtesy Arizona Pure Water Brew Challenge)

Klein: I think it’s fantastic. There’s this really unfortunate stigma that wastewater is something that can never again become drinkable. But the technology exists nowadays to make wastewater completely drinkable. Unfortunately, it’s government regulations that have forced companies and utilities to explicitly separate drinking water from wastewater, and from stormwater, and have them managed separately.

It’s great to see brewers taking the leap and really trying out this new concept. Beer is an area that I’ve certainly seen bring a variety of folks together in a way that tends be fun and a bit more engaging. It’s a great entry point into this type of discussion. In fact, Stone Brewing brewed a beer with wastewater in it last year, and I think Half Moon Bay Brewing did something similar.

Water Deeply: What about water bottling companies looking to tap a local water supply? Do they face unique challenges in trying to adopt sustainable branding?

Klein: You have to build trust before you can start asking for something from any community. That takes time. And it requires being consistent in discussing your values across geographies.

One of the things that has worked against many of these water bottling companies is a lack of evidence of historically positive impacts, whether it’s in that [new] community or in another community. It’s a lot easier to show you’re not going to have an impact if you have 30-plus years of historical monitoring records, both before and after you started withdrawing water. Unfortunately, most companies aren’t willing to invest in a lot of preemptive testing before they even stick a pipe in the ground. My hunch is that, as demands increase, there’s going to be an increasing expectation that companies will have to prove, in a really tangible way, that they’re not going to have that negative impact.

Water Deeply: What is the future of bottled water, in your opinion?

Klein: There is no denying that bottled water is growing. It is a dramatically growing market and continues to take demand away from soda and sweetened beverages.

But as it grows I think you’re also going to see it come under increasing scrutiny. You’re going to see consumers become more skeptical about where [it came] from and what are the consequences – whether it’s the water withdrawals or the packaging it comes in.

You’re going to see companies become more serious about water stewardship and replenishment projects. I think what’s probably going to need to happen is companies that fashion themselves as water bottlers are going to need to become water supply companies. In essence, a company is going to need to show it supports the human right to water – safe, clean drinking water – regardless of the form. They might provide it in a plastic package, but they also endorse water infrastructure – getting water out of your tap. They support hydration regardless of form, and it’s not explicitly targeted to selling their product.

I think it would be probably controversial, but an impressive evolution, if we were to see a bottled water company come out promoting policies that improve water infrastructure or investment in water infrastructure – or even make a commitment to invest in water infrastructure in a collaborative environment themselves. That would be something a lot of organizations would welcome, even if at first blush they might be a little skeptical. Water policy is an arena where we have yet to see a lot of companies take a stand like they have on climate.

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