Despite a relatively low response rate CDP Water Disclosure Australia Report for 2011 shows water related risks can be immediate and substantive to the countries biggest companies.
More than two thirds of the 22 respondents from the ASX100 identify water as a substantial risk to their business and half have already suffered recent detrimental water related business impacts according to the Carbon Disclosure Project’s first Water Disclosure Report for Australia.
But water-related issues (55 per cent) receive less attention than climate change (80 per cent) at the board level.
While 91 per cent of respondents were able to identify whether their direct operations are exposed to water risks; just 68 per cent were able to do so for their supply chains, according to the report.
The majority of respondents identify water-related business opportunities, the vast majority of which are expected to fall within the next five years. The most frequently reported opportunities include efficiency gains and improvements in brand value.
Of the 54 companies from the ASX100 surveyed because they were considered to be in water intensive or risky industries, 22 responded. This response rate of 42 per cent was below comparative international and South African surveys.
The report noted: “Given the acuteness of water stress in parts of Australia and the fact that 50 per cent of ASX 100 respondents report that they have experienced detrimental water-related business impacts in the past five years, compared to 38 per cent of the Global 500, a stronger response might have been expected from Australian companies on this critical issue.
The low response rate from companies in the Utilities and Energy sectors, especially large coal seam gas producers such as Origin Energy (ASX: ORG), AGL Energy (ASX: AGL) and Santos (ASX: STO) was disappointing given the potential risks that CSG operations may pose to surface water, and groundwater the report said.
It was also noted the CSG companies each make disclosures on water issues on their corporate websites.
Over 350 financial institutions, including 33 from Australia, with assets of US$43 trillion were signatories to the CDP Water Disclosure 2011 information request dated 1 February 2011.