Modern business responsibility has transcended itself from the borders of material benefits to the horizons of protecting nature and natural resources.
A 2019 study by WWF India has recorded how water related risks could limit production, disrupt supply chains and result in asset write downs, creating conflicts with one other.
The non-profit Customer Data Platform in 2014 found that 53 percent of companies reported ‘significant financial impacts from water – an increase of 40 percent over 2011.
According to the World Resources Institute study, water scarcity caused 14 out of India’s 20 largest thermal utilities to shut down at least once between 2013 and 2016, costing those companies $ 1.4 billion.
The study found that 39 percent of Indian Banking sector is exposed to high levels of operational risks – scarcity and pollution to be among the main.
The extension of loans to reckless business practices ranging from dams to factories resulted in the piling up of liabilities.
Water problems could push the non-performing assets of banks higher as many lenders have loan exposure in sectors where there are risks to water resources, says the report.
India is a highly water sensitive country where 600 million people are facing acute water stress. Around 70 percent households receive contaminated water. Discharging untreated effluents to the actual water sources have resulted in the closure of many industries.
While three-fourth part of the earth is covered with water only six percent is fresh and suitable for drinking. The source of this fresh water is underground water (72%), glaciers (27%) and water bodies (1%) like wells, canals, ponds, rivers and lakes.
This 1% water is getting depleted and polluted at a very alarming rate because of human activities. There should be a rethinking on the way, we use water.
A media report quoted a finding of the Council of Scientific & Industrial Research (CSIR) on pollution of ground water in India. The findings suggest that in 2014, around 7 crore people in 6 states were adversely affected by arsenic pollution.
On the one hand, when the underground water level is depleting due to over exploitation, global warming is causing sea levels to rise.
While the companies are providing pure water; taking steps to prevent water pollution and conserving water through rain water harvesting as part of their CSR (corporate social responsibility) initiatives, much more effort is required to address several water-related issues including scarcity of clean water.
One of the things that the government could do to increase corporate participation is to increase the mandatory 2 percent of Profit Before Tax (PBT) to at least 5 percent of PBT. Then only the environmental and social responsibility of modern companies could be tied tightly to the stone pillars of profit.
The problem of water is not limited to India, alone. Every year, unsafe water sickens 1 billion people around the world and water pollution caused 1.8 million deaths in 2015.
Cape Town In South Africa faces severe water shortage. It was first city in the world to experience ‘Day Zero’ when the government shut down water connections for homes and business, in 2018.