Water security is a top global issue. Virtually every product requires water at some point in its production, manufacturing or use. Water shortages and lack of access to clean, fresh water are two top global risks – and by 2030 global water consumption is expected to rise by 40%. As water demand rises around the world it will be difficult for many businesses to operate as usual. Whole sectors, companies and corporate value chains depend on water for their success. WWF, RBC and Molson Coors present their thoughts on the risks and opportunities to business and how to manage them. Coro Strandberg, Strandberg Consulting, introduces guidelines to help companies become transformational corporate water leaders.

1. The Water Imperative: New Standards in Corporate Water Leadership Conference Board of Canada December 4, 2014

2. OVERVIEW
• WWF: Water risk & tools
• RBC: FI perspective
• Molson Coors: Case study
• Q & A
2

3. Corporate water stewardship: Why mitigating water risk is increasingly material to business
Photo: © Alan Morgan
Alexis Morgan
Lead Advisor, Water Stewardship & Standards WWF

4. WARNING:
THE FOLLOWING PRESENTATION CONTAINS SOME GRAPHIC WATER WARNINGS. VIEWER DISCRETION IS ADVISED.
R
This is likely about your supply chain’s exposure to various forms of water risk and the fact that no site can mitigate that risk by itself.

6. Physical Risk
Reputational Risk
Regulatory Risk
Financial Risk
$
“Unless [extreme weather/water] risks are accurately evaluated and reported, companies will have limited incentives to reduce them. And valuations and investment decisions will continue to be poorly informed.”
– The Royal Society, Nov. 27, 2014
https://royalsociety.org/policy/projects/resilience-extreme-weather/

7. Where does your supply chain land?
Source: WWF-Mexico

8. •8% of US food production
•$17 billion USD
•90% world’s almonds
•Water supply for both San Fran & LA (portion)

9. July 2011
July 2012
July 2013
July 2014
California’s economy needs to ask itself:
•What is the plan to balance water use?
•What is the optimal use of water?
Current
Nov. 25

10. WATER
ENERGY (DAM)
FOOD

11. Water Stewardship
Water
Awareness
Knowledge of Impact
Collective Action
Influence governance
Internal action
WWF Water Stewardship Ladder
No strategy
Efficiency strategy
Risk strategy
Opportunity strategy
“The use of water that is socially equitable, environmentally sustainable and economically beneficial, achieved through a stakeholder-inclusive process that involves site and catchment-based actions.” - The Alliance for Water Stewardship [bold and underline mine]

12. The bewildering landscape of water stewardship
Ceres Aqua Gauge
ISO 14001
ISO 14046

13. Starting the water stewardship journey
•Quantify your water footprint: Quantify your direct & indirect water footprint (your impacts and risks are likely in your supply chain)
•Map your water risks: Map water risks (Water Risk Filter) and identify high priority areas for action (prioritize risk and opportunity)
•Leverage existing initiatives: Employ a comprehensive approach that takes advantage of existing efforts (e.g., AWS) and doesn’t reinvent the wheel
•Collaborate: Establish collaborative partnerships for innovative collective action (stewardship is not a go-it- alone exercise)
Short-term water management
Long-term water stewardship
Efficiency & cost
Effectiveness & value
Considering how you affect others
Considering how others affect you
Working alone (within industry)
Collaboration (between industries)

14. Risk
Why is a bank
interested in water?
Opportunity

15. Water is under stress
Threatened by:
•Population growth
•Pollution
•Climate change

16. Industries most at risk:
•Power generation
•Mining
•Semiconductor manufacturing
•Agriculture
•Food and beverage
Also at risk:
•Investors
•Municipalities (taxpayers)
Risk to our clients

17. Risks to our clients
•Rising costs of water supply and water management.
•Higher cost of compliance with ever- tightening water related regulations.
•Business disruption due to water issues such as significant storm events and flooding.
•Increasing competition for finite freshwater supplies among various users within a community.
•Reputational damage if a business is seen to be mismanaging water.

18. Risk to our Insurance business
•Observed 40% increase in water related claims to our RBC Insurance business
•Insurance Bureau of Canada reports that water damage is now the leading cause of property damage in Canada
•Already a significant understanding of the probable effects of climate change

19. 19
Risk to our Insurance business
Eastern Ice Storm
Quebec Floods
Slave Lake Fire
Ontario Wind and Rain
Alberta and Toronto Floods
$3.0
Insurance Claims ($ billions)
$2.0
$1.0
$2.5
$1.5
$0.5

20. Opportunity for our clients …Valued at $22.6 trillion
• Water efficiency
• Infrastructure
• Water treatment technology
• Filtration and desalination
• Metering and system management
IBM: “The smart water market will be worth $15 - $20 billion a year.”

21. RBC Water Advice
Launched the RBC Greening Your Business Advice Centre in 2010

22. RBC Water Advice
Launched four sector specific reports on addressing top sustainability issues:
•Manufacturing, partnered with Canadian Manufacturers & Exporters
•Logistics and Transportation, partnered with Supply Chain & Logistics Association Canada
•Agriculture, partnered with Farm & Food Care Foundation
•Retail, partnered with Retail Council of Canada
All four reports have an entire section dedicated to water

23. RBC Water Advice
Water damage sources:
•Basement flooding due to sewer backup and eavestrough overflow
•Broken or burst pipes
•Overflow or links from tubs, toilets and sinks
•Leaks from appliances
•Leaks in cracks in walls and foundation
•Water tank leakage or burst
•Roof leaks – heavy wind, heavy rain, snow and hail damage
•Window and door seals

24. Reducing & Protecting Water in Our Operations
Commitments:
•Reduce the use of landscape irrigation in regions deemed water-stressed;
•Reduce the use of water by incorporating water-efficient technologies in our new properties or properties undergoing renovation; and
•Use environmentally responsible cleaning products in janitorial and cleaning services to help protect water quality.
Significant landscape maintenance savings associated with xeriscaping

25. RBC Blue Water Project
Since 2007, we have donated $42 million to over 500 organizations and initiatives

26. “The Blue Water Project is one of the most special projects that RBC has had in its history” said Gord Nixon, former RBC CEO
Employee Engagement: Blue Water Day
In 2013…

27. Our Approach to Water Stewardship
• Who we are
• What drives us to be good water stewards?
• Water Management at Molson Coors
• Lessons Learned

28. MOLSON COORS – WHO WE ARE
Molson Coors Canada
Brewing Capacity: 12 Million HL Annually
41% Share of Market
MillerCoors
Brewing Capacity: 103.7 Million HL Annually
29% Share of Market
Molson Coors International
Core Markets
Molson Coors Europe
Brewing Capacity: 30.6 Million HL Annually
Share of market:
UK and Ireland 19%
Montenegro: 90%
Serbia 52%
Croatia: 44%
Bulgaria: 34%
Bosnia-Herzegovina: 27%
Hungary: 25%
Romania: 16%
Czech Republic: 15%
Slovakia: 5%

29. WHAT DRIVES US TO BE GOOD WATER STEWARDS
Evolution of Water Management at Molson Coors:
 Focused on local compliance up to 2007
 2008 – Signed the CEO Water Mandate
 2009 - Developed more comprehensive strategy on water
management
 2013 – Adopted risk-based integrated sustainability strategy with
water at the forefront
Drivers:
 Stakeholder expectations on environmental stewardship
 Business risk

30. WATER MANAGEMENT AT MOLSON COORS
Principles of the CEO Water Mandate:
 Operations
 Supply Chain and Watershed Management
 Collective Action
 Community Engagement
 Transparency

31. OPERATIONS
Energy
• 25% energy
intensity
reduction
• Publically
commit to
Alternative
Energy
• Transition
from
managing
to carbon
Waste
• Zero
Landfill
globally
Water
• Risk-based approach to setting targets
and allocating resources for water
reduction
• We commit to breweries subject to
high water supply risk achieving
world-class water intensity
• Organic efficiency savings in all
breweries
• Anaerobic Digestion of Effluent and
Energy Recovery is a Strategic
Technology for Molson Coors
Operations
Valuing Our Resources to Fuel Our Brands

32. WATER MANAGEMENT AT MOLSON COORS
Supply Chain and Watershed
Management
 Partnerships with suppliers to build water
management capacity
 Supplier Sustainability Scorecard
 Engage with environmental authorities
to address local issues

33. WATER MANAGEMENT AT MOLSON COORS
Collective Action:
 Pilot projects – Partners in Project Green
 Develop industry tools – BIER True Cost of Water Tool
 Build community partnerships for water education and outreach –
Tadcaster River Wharfe Community Group

34. WATER MANAGEMENT AT MOLSON COORS
Community Engagement:

35. WATER MANAGEMENT AT MOLSON COORS
Transparency:
Transparency:
• Our strategy and transparency is
helping us to get recognised by some
of the leading sustainability indexes
• Long term proof of our water strategy
will be the our ability to continue to
Brew our brands in an increasingly
resource constrained world without
impacting on our communities
• Delighting the worlds beer drinkers!

36. LESSONS LEARNED
 Conduct a materiality assessment to identify the issues and how
important it is to you – use this to develop a business case for
resources
 Consumers care increasingly about traceability and
social/environmental stewardship of the products they consume.
 Engagement with the community in the watershed and with your
supply chain can provide the visibility and ‘good story’ that you
need to connect with consumers

37. IS YOUR COMPANY
TRANSFORMATIONAL?

38. http://bit.ly/10EUdnA

39. Questions
coro@corostrandberg.com

40. Thank you!