World Water Week: Businesses urged to invest in supply chain sanitation

Many businesses are updating their water strategies in a bid to minimise consumption and restore habitats in water-stressed areas. WaterAid is urging private sector players to also increase investment in water access for supply chain workers.

World Water Week: Businesses urged to invest in supply chain sanitation

Pictured: Leather tannery workers in India using a new hand-washing facility. Image: WaterAid/ Anindito Mukherjee

Today (23 August) marks the start of World Water Week for 2022. The event has been held annually for more than 20 years by the Stockholm International Water Institute in a bid to foster collaboration for improving water governance worldwide.

This year, the theme is ‘the value of water’ – a value many have been forced to rethink in recent weeks amid droughts. It was reported earlier this week that 64% of Europe is now under a drought alert or on the verge of drought. China is also reporting impacts from drought to its energy and food systems. Elsewhere, extreme drought conditions are continuing in parts of Mexico and Ethiopia.

While some homes and businesses are forced to ration water temporarily – and longer-term conversations about efficiency and stewardship progress –  WaterAid has published new research in a bid to urge decision-makers not to forget that access to water and sanitation remains a major issue for a great many people. It is estimated that 771 million people don’t have access to clean water in or close to their homes, and that one in four people don’t have access to a decent toilet of their own.

WaterAid’s chief executive Tim Wainwright said: “As climate change is set to drive erratic weather events such as flooding, droughts and cyclones, investing in WASH is fundamental to safeguarding people already living on the frontline of climate change and to building robust, sustainable businesses.

“The business landscape is changing and with the provenance of products becoming increasingly important to the consumer, business leaders now have huge potential to make a significant difference to the lives of millions.”

WaterAid’s research, supported by HSBC, assessed how investment in access to water, sanitation and hygiene (WASH) for supply chain workers benefitted businesses sourcing from leather and apparel suppliers in India and Bangladesh.

The investments assessed in India increased the availability of toilets at home for workers by 10%, the accessibility of drinking water by 30% and access to hand-washing stations by 12%.

In Bangladesh, the investments increased access to safely managed water and decent toilets in homes from 0% among workers, to 31% and 26% respectively.

In both geographies, businesses recorded significant decreases in absenteeism, attributed to improved health – both for the staff and for their families. Factory managers reported that, before intervention, staff would often have to take time off to care for sick children or other relatives at home. Absenteeism was down by 29% in India and 15% in Bangladesh. Punctuality and staff retention levels were also boosted over a two-year period.

WaterAid is emphasising how, by investing in WASH for staff and supply chain staff, businesses can expect significant returns on investment due to these trends. The factories in Bangladesh stand to see a return on investment of almost $7 for every $1 invested in WASH access over a ten-year period. In India, the rate was $2 for every $1 invested.

These calculations only account for trends such as reduced staff sickness and improved productivity. When considerations like reputational impact and supply chain resilience are added to the mix, the ROI will be higher. WaterAid is emphasising how many businesses may be at greater reputational risks now, after changing their ESG targets, and with these targets more visible to stakeholders via digital technology.

WaterAid’s project lead for the research, its senior private sector advisor Ruth Loftus, said: “There’s a compelling case for factory management to pick up the gauntlet and invest in taps, toilets and good hygiene for their employees. The participating factories are showcasing the business benefits, generating a return on their investment, aligning with regulation and reputational expectations and potentially driving change for millions of people through the companies they supply – many of which are global brands.”

CDP stated last year that the private sector could face up to $120bn in additional costs across their supply chains by 2025 that they have not planned for, owing to poor measurement of – and intervention to address – environmental and social issues.

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