Risks Linked to Water Use

Whereas,

The business case for developing long-term corporate water use strategies has never been stronger (GEMI, 2002):
· Total water costs are increasing in unexpected ways;
· Risks of business disruption due to water-related issues are increasing;
· Customer expectations relating to water use and impacts are evolving; and,
· Businesses' "license to operate" and ability to expand are increasingly tied to water-related performance

Scientists predict that water use for households, industry, and agriculture will increase by at least 50% over the next twenty years, leading to greater competition for water resources and, potentially, higher water prices (IFPRI & IWMI, 2002).

Industrial water users are likely to face changes in water-related regulatory regimes that may lead either to price increases or supply constraints or both. Currently more than 1 billion people around the world do not have access to a safe water supply. World leaders agreed at the World Summit on Sustainable Development in Johannesburg to cut in half the number of people without access to clean water by 2015 (WSSD, 2002).

The bottled water industry is particularly exposed to reputation risks when disputes with local communities arise over water use. Competitors, such as Nestle Waters North America, are engaged in court proceedings with a local citizens' group over a proposed bottling operation in Michigan (Business Week, 2002).

Bottled water makes up a small but fast-growing component of our company's product portfolio, further compounding the potential for brand risk if conflicts with local communities over water use issues were to increase.

Therefore Be It Resolved, that the Board prepare a report to shareholders (at reasonable cost and omitting proprietary information) by September 2003 evaluating the business risks linked to water-uses and impacts throughout our company's supply chain, including subsidiaries and bottling partners, with special reference to our company's current policies and procedures for mitigating the impact of operations on local communities in areas of water scarcity.