3. Sample Agenda, e.g. 10:00 – 12:00 Water & Scenarios within Company Y – Mr. Y, Company Y 11:30 – 11:40 Q&A and Close 11:40 – 12:00 Feedback from each group 11:20 – 11:30 Context and Presentation of the Scenarios 10:15 – 10:50 Breakout discussions in 3 groups 10:50 – 11:20 Water & Business: an overview – Ms. X, Company X 10:05 – 10:15
4. Objective of this Session Understand water-business links … by using scenario framework as a tool
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6. How much water will be withdrawn with respect to the amount that is naturally available? Freshwater Stress is Increasing… Faster than Expected ---- 2005
9. Clarify and enhance understanding by business Objectives in Building these Scenarios Promote mutual understanding … and support effective business action
16. Scenarios versus Forecasts Current Realities ( mental maps ) Multiple Paths Alternative Future Images SCENARIOS The Present The Path The Future FORECAST
17. X Predictions Projections Preferences Credible Challenging Coherent … stories describing paths to different futures, that help us make better decisions today What are Scenarios?
22. Hydro More drops, more value per drop Hydro Economy Huge Opportunities In the Shadow of the Olympics More and More Mega Cities China ranks fourth in the world for renewable water resources, but because of its large population, it has only 1/4 of the global average of water per capita . 2005 2010 2015 2025
25. Rivers Security for all… in terms of quality and quantity Security Deficit Trust Deficit Local Partnerships « Water management is, by definition, conflict management. » Worldwatch Institute, 2005 2005 2010 2015 2025
28. Ocean Accounting for the whole system Unintended Consequences Global Fair Water Movement Water Footprints Networked Global Governance Approximately 37% of the global population (over 2 billion people) lives within 100 km (60 miles) of a coastline. 2005 2010 2015 2025
29. Estimated water use by life cycle stage (%) Unilever , 2005 Virtual Water – to produce one kilogram of… 1,300 liters 3,400 liters 15,500 liters
32. Climate change impacts accelerate…. Impacts of historical water overdrafts & ecosystem changes manifest Security through interdependency emphasised Accountability for ‘virtual’ water uses/impacts emphasised 2006 States enable economic value of water Global market opportunity for innovative solutions Rapid gains in efficiency Social tensions/conflicts and rivalries over water increase Legal and moral liabilities about access and responsible use flare National security interests inhibit progress towards IWRM.. Local solutions sought Three D ifferent F utures C ould U nfold…
36. Take Home Question Considering the scenarios as a set, what do you now think are the biggest risks and opportunities for your business’ operations, investment decisions, products, or services in an increasingly water-stressed world? “ These scenarios highlight the complex interrelationship between water, energy and food security and the need for a holistic approach to water management . ” Jeroen van der Veer, CEO of Shell
62. Discussion in Groups – 30 minutes What happens when the ‘whole system’ isn’t taken into account? How can virtual water be made more transparent? What are the tensions and trade-offs in managing water resources and allocation at local and global levels? What happens if the water ‘haves’ and ‘have not’ issues are ignored? What constitutes ‘fair water’ uses and who will decide? How can water conflicts be avoided? Which legacies need to be unlocked to drive innovation? Where else will cities face big water challenges? What appropriate solutions can you see and reach?
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Notes de l'éditeur
Understand water-business links …by using scenario framework as a tool: Bring people to a common understanding Create a framework for dialogue Explore possible future challenges
See www.wbcsd.org for more information if needed. 190 international companies from 35 countries and 20 major industrial sectors Global network of 50+ national and regional business councils and partner organizations. Our mission is to provide business leadership as a catalyst for change toward sustainable development, and to support the business license to operate, innovate and grow in a world increasingly shaped by sustainable development issues. Our objectives include: Business Leadership Policy Development The Business Case Best Practice Global Outreach Recognized by GlobeScan as the leading voice in Sustainable Development
Map shows projects how much water will be withdrawn with the amount that is naturally available. Some experts consider that we have already reached the initial projection for 2025! How much water is available for all of those people? With a more or less constant amount of renewable freshwater resources on the planet, more people has meant and will continue to mean less water per capita. While interesting at one level, these global averages mask, of course, the huge variations that can be seen at regional, national or local levels. If we look at the United States, the trend is similar to the global trend, but one would say the country as a whole is well within the comfort zone for the foreseeable future. On the other hand, if you know the US, you are well aware that there is big difference between scarcely populated, water rich Alaska and heavily populated, water scarce Southern California. 1.1 billion people (20% of world population) – are without access to safe drinking water 2.6 billion people (40% of world population) – do not have access to adequate sanitation.
Clarify and enhance understanding by business of the key issues and drivers of change related to water. Promote mutual understanding between the business community and non-business stakeholders on water management issues. Support effective business action as part of the solution to sustainable water management.
About a third of the 180 members of the WBCSD form the broader water working group in the WBCSD. A smaller core team of 19 companies representing various sectors has participated actively in the work program and, in particular, in the scenario project that I will soon describe. The interest of these companies in water stems from diverse motivations. Some are heavily dependent on water resources as users either directly in their own processes or indirectly through their supply chains; others are concerned about the impacts of their activities on the water environment; still others are looking at the use of water and environmental impacts of the end-users of their products; finally, many see opportunities to provide technology, know-how and services to meet water related needs in all sectors.
The process involves three main steps: orientation, scenario building and affirmation. This diagram illustrates our scenario-building process. The three orientation workshops (on the top of the diagram) highlighted regional challenges from which common global challenges were extracted. Reflection on these outcomes led to ‘meta-themes’, which were further refined at the Building Workshop. The Building Workshop gave rise to three embryonic storylines that evolved into H, 2, and O – Hydro , Rivers , and Ocean . These are linked to the meta-themes through the 5 Ps – People, Planet, Past, Politics, and Policies. Finally, the Affirmation Workshop ensured our scenarios reflect the many challenges that the process has brought to light.
Compare practices and experiences
When we think about the future, particularly from an organisational or group perspective, we think in terms of strategy. Strategy is about what we ‘should’ do. Scenarios, on the other hand, explore what ‘might’ happen. They helps us prepare for the journey to the future, to develop preparedness for the different landscapes through which our path will pass.
Forecasts are based on the best judgment of a group of experts on the present situation that they extrapolate into the future. Scenarios are based on the many different mental maps that people have, giving rise to multiple paths to alternative possible futures. Scenarios differ from forecasts in that they always come in sets – two, three, or more equally plausible, relevant, and challenging versions of a possible future. A forecast is based on a single interpretation of the best information one has about the present as it is extrapolated into the future. Fundamentally, a forecast assumes that the future is fairly similar to the past or that one understands with a fair degree of certainty what is likely to happen. Scenarios, in contrast, offer multiple versions of an unknowable future. They also sometimes combine forecasts for various key factors, thus bringing about new insights about correlative or synergistic effects. To engage with scenarios is to hold two or more stories in the mind at the same time – and therefore to hold the future not as a belief, but as a fiction. Such stories help to deal with uncertainty without turning that uncertainty into a false sense of certainty. In addition, they help to handle the multi-dimensionality of our future. Scenarios move from what is known to what is not known. In addition to changing mental maps, engaging with scenarios can reveal blind spots as well as expose areas where strategies may not be robust. Rather than offering answers, they create a common language and a shared context so that we can begin a strategic conversation. To change the way we act, we must first change the way we think – and scenarios are a platform for effecting this change.
In considering the context for the water challenges that face business, we explored five interacting drivers of change in which these challenges are most clearly seen: People – for example, population growth, urbanization, sanitation, water supply, demographic and structural changes, increasing per capita consumption of water with economic development and lifestyle changes, rising supply-sanitation gaps, public health and pollution burdens, the growing reach and impact of city water needs and discharges on ecosystem services and products. Planet – for example, ecosystem degradation, biodiversity losses, climate change leading to sea-level rise and changes in the hydrological cycle, rainfall patterns, natural disasters (floods, droughts, hurricanes), the melting of ice caps and glaciers, the rates and patterns of river flow, man-made disasters (such as chemical spills). Past legacy systems – for example, inadequate or poorly maintained infrastructure, financing and pricing systems, pollution loads, water over- ex traction, water-service pricing, cultural practices and attitudes that hinder innovation. Politics – for example, differing cultural assumptions and means of judging water challenges, inadequate political and organizational systems, lack of political leverage, upstream-downstream issues, access, equity, lack of education, cooperation or conflict between users, including intergenerational, inter - national and intra-urban disputes, water as lacking any political value as an issue, manipulation of information, lack of a political voice for the ecosystem. Policies – for example, lack of coherent policies and their application (governance), varying emphasis on a range of policy objectives (for example, efficiency, security of supply, wider access , and equity), shift towards adaptive policies, issues of best practice, public-private partnerships, capacity-building, corruption, difficulties inherent in creating policies regarding embedded water in global trade , global water management issues . The world of water issues is potentially paralyzing in its complexity – so to deal with this complexity in a way that would encourage a cross-sector business dialogue on these issues, we created a set of water scenarios. The ‘H2O’ scenarios help make sense of the evolving complexity and focus attention on three significant global water challenges that will combine to impact businesses and societies everywhere –the efficiency challenge , the security challenge , and the interconnectivity challenge . Each of these challenges incorporates many other challenges to business that are emerging from the changing status of water.
Hydro – The Efficiency Challenge With economic development, water demand increases more quickly than population. The resulting stress on water resources is exacerbated by low water-use efficiency, especially in the agricultural sector, caused by factors such as outmoded water systems, poor regulatory enforcement, ineffective price signals, and the lack of incentives for changes in behavior, particularly by those who claim historical rights to water access. The efficiency challenge in the world of water calls for more value per drop – and “more drops for less,” including the value that comes from more jobs per drop, less energy and pollution per drop, efficient water use, and more water for less environmental impact. This efficiency challenge leads to the business challenge of innovation – not only in producing new products and services, but also in avoiding or addressing legacy constraints Rivers – The Security Challenge The increasing stress on local water supplies in many parts of the world raises the issue of water security – quantity and quality for all. The major challenge in water security is to ensure that water is allocated and managed effectively and that there is enough to meet all needs – including those of the seriously water scarce and of the ecosystem services and products on which many livelihoods and economies depend. The political processes for re-allocating water fairly and effectively are of fundamental importance because if local water security is not maintained, the business challenge will include preserving the social license to operate in that area – even for businesses that are not directly involved in water issues. Ocean – The Interconnectivity Challenge Human security and development cannot be isolated from the health and viability of the earth’s underlying life support systems. The interconnectivity challenge requires us to be able to think and act in terms of multiple geographies of connection, from nation states and city limits to watersheds and river basins, and in terms of multiple timeframes, in order to ensure that short-term interests do not foreclose longer-term possibilities. The interconnectivity challenge also requires us to take into account not only ‘blue water’ issues of the water we see, such as the water in lakes and rivers, but also the so-called ‘green water’ contained in healthy soils, and the ‘virtual’ or embedded water contained in traded products and services.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
ALTERNATIVE SLIDES: Unlocking legacies: “unlock” refers to the fact that some legacies prevent us from moving forward because the situation is locked, e.g. Pump – ageing infrastructure in Europe – can’t just leave it, need to deal with it (very costly). Ganges River – traditional customs and spiritual values means challenge to, for ex, stop people drinking water that is dirty. Which legacies do you think we need to unlock today?
Same production using less water Example: Over the last two decades, Eskom has introduced a number of innovative technologies to save water. These include dry cooling, desalination of polluted mine water for use at the power stations, etc. In doing so, more than 200 million liters of water are saved every day. E.g.: Dry cooling technology uses about 15 times less water than conventional wet-cooled power stations. (Eskom case study) Crop – Use a crop that requires less water if in water scarce region.
The 2nd story is about water security for all and business’s social license to operate. Those that have water & those that don’t (haves and have nots) End of RIVERS: BUT, although local partnerships solve many local problems, upstream solutions sometimes have unintended downstream consequences. Wider waterscape continually changing: climate change, water transfers through traded goods, historical pollution legacies & over abstraction practices – need to look at wider picture…
Redistribution challenge: Difficult to decide how water is distributed within a local community – so how do we make sure water gets to all members of society? Who decides? Is it those that need it the most, those that can do the most with it, or those that can pay the most for it? Data for world averages of water use: UNESCO, 2003
2-sides: haves and have-nots: Unfortunately, many people in the world without access to clean water- but this is warning that others can become water have-nots: US white farmer, or even biz! A woman collects water from a pond outside the village of Dembi in southern Ethiopia. The water is contaminated from the livestock that drink here, but it is the only water available within walking distance of the village. Villagers, especially women and children, often walk for hours to collect water here in the Moyabe district, in southern Ethiopia. BUT – not only standard perception of have-nots – rich US farmers can end up being water have-nots as all the water is allocated to the cities because of political will of urbanization…
The 3rd story is about interconnectivity, taking the whole water system into account. It talks about unintended consequences & business accountability Interdependence of everyone in world of water, where biz can play a leading role.
Virtual water is the water embedded in traded goods. In this story of Ocean, it’s presented as a way to trade, which means that water has been given a value . To produce one kilogram of wheat, rice and beef respectively (not bread or cooked rice or steak – the pictures are just illustrative)… Unilever reports on the amount of water used by life cycle stage – e.g. for foods, but the link there between food product and water is natural. How about the amount of water needed to produce a micro-chip, or a car, which then gets exported around the world? The whole concept quickly becomes rather mind-boggling! Data info: Data for rice is for “broken” rice: This includes the water in the paddy fields used to grow the rice, the water used to remove the husks and break the rice. Producing one kilogram of rice in a humid country, say Canada, takes about 1000 liters of water whereas in an arid country such as Israel it takes 2000 liters (Source: Hoekstra and Hung, 2002). Source: Water footprints of nations, Volume 1: Main Report, A.K. Chapagain and A.Y. Hoekstra, November 2004, UNESCO – IHE, http://www.waterfootprint.org/Reports/Report16Vol1.pdf Unilever data: from Unilever’s Environmental and Social Report, 2005
From publication: “ A large international food company, which has outsourced the growing and processing of chickens to Brazil, becomes embroiled in a dispute over the use of water in one of its processing plants. The villagers downstream from the plant claim that too much water is being taken from the river for the chicken processing, leaving too little for their needs, including for basic drinking water. Since these chickens are destined for dining tables in northern Europe, the article points out that the Brazilians are suffering from an unintended consequence of global trade – in effect, exporting their precious water while local populations suffer from shortages. ”
IWRM = Integrated Water Resource Management
Considering the scenarios as a set, what do you now think are the biggest risks and opportunities for your business’ operations, investment decisions, products, or services in an increasingly water-stressed world? What are the dilemmas in Hydro/Rivers/Ocean? (drawing on both their knowledge and the scenarios; e.g. urbanization vs. fresh Water stress; using water vs. paying for it...)
The process involves three main steps: orientation, scenario building and affirmation. The orientation stage identifies the issues that matter to participants and what forces of change are influencing them at the regional and global levels. This phase is crucial as its goal is to identify key issues, global and regional drivers and to focus on the questions that the scenarios should elucidate. Interviews with knowledgeable individuals are conducted and one or more workshops are held. In this project, 3 orientation workshops were held in Panama, China and Switzerland. This regional approach was adopted to obtain a diverse sample of perspectives that would help distinguish commonalities and specificities at the global scale. The scenario building phase began with a workshop to further explore, characterize and classify the driving forces identified in the orientation phase. Participants then began to construct a range of scenario stories that illustrate how the global-level driving forces are likely to shape the key issues over the next 20 years. Our project team selected this timeframe as a period relevant to business planning and for which reasonably reliable data and trends are available. In the affirmation stage, participants in the process test the plausibility and relevance of the scenarios and begin to examine the strategic implications for their activity. This final phase of the production process is not just about completing the stories, but as much or more about setting the stage to constructively use the scenarios. Overall, the project has involved a series of five workshops over the span of a year and the participation of some 200 individuals drawn from businesses, NGO’s, governments and academia.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
The 1st story is about economic growth & innovation and it takes place in China (e.g.) End of HYDRO: BUT, disparities still exist between rural and urban areas: Chinese rural poor don’t get the water because technologies developed to solve urbanization problems… Technology not always solution: There will always be water-scarce areas, meaning problems of distribution: some will have water, others will not.
The pictures show a car driving through a puddle in the street. The puddle originated from a broken sewer that, over time, eroded the sand around the pipe. Thus, the asphalt of the street lost its support and formed a depression into which rainwater collects. This process continued for a while until so much sand under the asphalt was eroded that a large void is created and at one day and with a little extra load (e.g. a car) it collapsed. Legacy – Something handed down by a predecessor
Europe rebuilding old infrastructure & cultural beliefs and religion
If you use a bicycle every day, will you (feel entitled to) use the energy and money you’ve saved to go on a plane to a far-away destination? Rebound effects – secondary, negative effects of primary water-efficiency improvements – for example, the use of energy-efficiency savings for long-haul, energy-intensive trips, or the increase in water-consuming activities made possible by the increased savings of income achieved through improved water efficiency.
The 2nd story is about water security for all and business’s social license to operate. Those that have water & those that don’t (haves and have nots) End of RIVERS: BUT, although local partnerships solve many local problems, upstream solutions sometimes have unintended downstream consequences. Wider waterscape continually changing: climate change, water transfers through traded goods, historical pollution legacies & over abstraction practices – need to look at wider picture…
The 2nd story is about water security for all and business’s social license to operate. Those that have water & those that don’t (haves and have nots) End of RIVERS: BUT, although local partnerships solve many local problems, upstream solutions sometimes have unintended downstream consequences. Wider waterscape continually changing: climate change, water transfers through traded goods, historical pollution legacies & over abstraction practices – need to look at wider picture…
The 2nd story is about water security for all and business’s social license to operate. Those that have water & those that don’t (haves and have nots) End of RIVERS: BUT, although local partnerships solve many local problems, upstream solutions sometimes have unintended downstream consequences. Wider waterscape continually changing: climate change, water transfers through traded goods, historical pollution legacies & over abstraction practices – need to look at wider picture…
The 2nd story is about water security for all and business’s social license to operate. Those that have water & those that don’t (haves and have nots) Water security means having access to sufficient quantities of water of adequate quality, at right time & right place. 1 – Security deficit - By 2010, low-income and emerging economies often lack safe drinking water – if they want clean water, they have to pay for it This leads to rich getting richer and poor getting poorer – citizens distrusts governments - Also in developed world, old water systems results in greater costs – in 2015, for the 1 st time, middle-class households struggle to pay for water bills 2 – Trust deficit Increase media coverage – increased pressure on EU and US companies that operate in developing countries: taking water from poor for industrial, manufacturing or agribusiness use This leads to boycotting in rich countries, which means risk of loosing social license to operate, so biz increases capacity for internal recycling and reuse. - But many governments use water policy as a mechanism of coercion = asserting the right to deny access. The finger of blame implicitly pointed at biz 3 – 2-gether - Biz understands water security not only efficiency & technology, but also policy – so form public-private partnerships, PPP’s: the more biz participates in helping shape water policy, more likely ensure own needs - By 2010, recognize that water security closely tied to energy security (& food, & health…): energy needed for water, water needed for energy BUT, although local partnerships solve many local problems, upstream solutions sometimes have unintended downstream consequences. Wider waterscape continually changing: climate change, water transfers through traded goods, historical pollution legacies & over abstraction practices – need to look at wider picture…
Who do you trust?
The 3rd story is about interconnectivity, taking the whole water system into account. It talks about unintended consequences & business accountability 1 – Unintended consequences - Lulling to sleep – bored/helpless/don’t care - Floods continue; some in Asia due to deforestation (destroy villages), in Europe due to increase rainfall, which affect industries (e.g. Rotterdam). - 2010: Africa & L. America complain that water is being used by rich-country lifestyles - Large international food company – outsource growing & processing of chickens to Brazil – Brazilians suffer from exporting precious water while locals suffer shortages. - 2015: 5 confirmed cases of cholera in London: traced to international travel – shock of this in developed economy energizes Global Fair Water Movement. - Fair Water Movement says: need global standards to guarantee right to clean water for all humans on planet. - Worldwide attention given to water – corporations more attentive than ever to liability issues Example of Unintended Consequences: - Higher dikes in NL don’t address wetlands destruction in Germany. Regional solutions don’t address the unintended consequences of decisions made elsewhere. - US drive to energy self-sufficiency resulting in push for bio-fuels: o Tensions in water-scarce areas of US o US becomes dependent on food imports from Brazil o Clearance of Amazon for more agricultural demand 2 – Water footprint: - 2010 – companies report total volume of water used directly or indirectly (total accounting) (need tools) 3 – Market mechanisms - 2020: companies with large water footprints engage in virtual water trading on basis of fully priced externalities - emergence of water-based economic zones - Need market mechanism & governments through legislation: Europe, US and Asia address true value of water & complete cycle – new laws on: Reduced water losses, Recycling & re-use, New standards in water & sewerage network quality. + subsidize on water-saving technology. Interdependence of everyone in world of water, where biz can play a leading role.
The 3rd story is about interconnectivity, taking the whole water system into account. It talks about unintended consequences & business accountability Example of Unintended Consequences: - Higher dikes in NL don’t address wetlands destruction in Germany. Regional solutions don’t address the unintended consequences of decisions made elsewhere. - US drive to energy self-sufficiency resulting in push for bio-fuels: o Tensions in water-scarce areas of US o US becomes dependent on food imports from Brazil o Clearance of Amazon for more agricultural demand
The 3rd story is about interconnectivity, taking the whole water system into account. It talks about unintended consequences & business accountability 2 – Water footprint: - 2010 – companies report total volume of water used directly or indirectly (total accounting) (need tools)
The 3rd story is about interconnectivity, taking the whole water system into account. It talks about unintended consequences & business accountability 3 – Market mechanisms - 2020: companies with large water footprints engage in virtual water trading on basis of fully priced externalities - emergence of water-based economic zones - Need market mechanism & governments through legislation: Europe, US and Asia address true value of water & complete cycle – new laws on: Reduced water losses, Recycling & re-use, New standards in water & sewerage network quality. + subsidize on water-saving technology. Interdependence of everyone in world of water, where biz can play a leading role.
Red shading indicates the densely populated coastal lowlands of Bangladesh, India and Pakistan Picture from: « Potential Impacts of Sea-Level Rise on Populations and Agriculture » by R. Gommes and J. du Guerny, Sustainable Development Department and F. Nachtergaele and R. Brinkman , Agriculture Department , Food and Agriculture Organization of the United Nations , FAO 1998
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