Friday, March 12, 2010


After nutrition labeling, allergen labeling and declaration of carbon foot prints, industry is likely to face new demands for indicating the extent of water used in the manufacture of products. Severe scarcity of water world is facing to day is compelling many countries to go for measures to conserve water, the most visible action being rain water harvesting. According to suggestions by some conservationists, water is being taken for granted by huge corporate organizations with scant regard to its sustainability and this calls for disclosure of risks inherent in water shortage that would impact the performance of public traded companies.

"Most publicly traded companies that depend on water do not adequately disclose their financial risks to droughts and future regulations, even as water scarcity problems mount, according to a report released on Thursday. The report produced by Ceres, a coalition of investors and environmentalists and Swiss Bank UBS (UBSN.VX), ranked 100 of the biggest publicly traded companies on the quality, depth and clarity of their water disclosure risks and opportunities".

Though the demand at present is linked to risks associated with a company's performance and its effect on its net worth in future, food industry may ultimately be asked to declare the intensity of water use during its manufacturing operations to sensitize them on water profligacy. Food and Biotech industry sectors are high water guzzlers and hence might be the first targets. Such social pressure may change the water use pattern making the industry go in for water economy measures including recycling in a big way.


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