Exploring the Critical Link Between Food Companies, Water Risk, and Ecosystems

The global food and beverage industry, valued at $6 trillion, is facing a critical water crisis that is impacting both freshwater supplies and ecosystems worldwide. With the industry utilizing over 70 percent of the world’s fresh water, the need to address water scarcity and pollution is more urgent than ever.

A recent report by Ceres, the Valuing Water Finance Initiative Benchmark, assessed 72 companies across four industries, including 39 in the food sector, to evaluate how they are valuing and acting on water as a financial risk. The report highlights the steps some food companies are taking to reduce their impacts on freshwater ecosystems and strengthen sustainability strategies.

One key area of focus for food companies is sustainably sourcing ingredients. Many companies are working with suppliers to implement sustainable agricultural practices that reduce water pollution and protect ecosystems. For example, Kerry Group partners with milk suppliers to reduce pollution discharge and mitigate the risk of eutrophication.

Additionally, companies like General Mills are advancing regenerative agriculture practices to improve soil health, water quality, and biodiversity. General Mills aims to have 1 million acres of farmland under regenerative agriculture by 2030, with over 500,000 acres already part of the program.

Some companies are also directly involved in projects to protect or restore specific ecosystems. Wilmar International, for instance, collaborates with Indigenous communities in Sumatra, Indonesia, to preserve riparian zones and water quality in important river systems.

Setting clear targets to protect ecosystems is another crucial step being taken by food companies. Danone, for example, aims to develop and implement plans to preserve high-stressed watersheds using nature-based solutions like agroforestry and wetland preservation by 2030.

Overall, the food industry recognizes the interconnectedness of water scarcity, pollution, and ecosystem loss and is taking proactive measures to address these challenges. By prioritizing sustainable sourcing, regenerative agriculture, ecosystem protection, and setting clear targets, food companies are working towards a more water-secure and environmentally sustainable future.