Meeting the world’s water challenges Introducing PwC’s sustainable water services

www.pwc.com/sustainability
Meeting the world’s
water challenges
Introducing PwC’s sustainable
water services
August 2013
Contents
Introduction
Sustainability
at PwC
Thought
leadership
4
Global water
issues
9
How PwC can
help
24
Contacts
5
10
Introducing PwC
Who we have
assisted and how
8
12
25
“We will never know the true
value of water until the well
runs dry”
Benjamin Franklin
Two-thirds of the planet is covered by water.
Yet the rivers, lakes and groundwater available to
humans and ecosystems represents less than 1% of
this total.
Source: UNEP Vital Water Graphics 2008.
PwC
3
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Introduction
Water: Our most precious resource
Clean water is an essential resource to human life. We use it for personal
consumption, for our agriculture, and for our industry.
Yet under current population growth and urbanization trends, as much as twothirds of the world’s population may live in areas with physical or economic
scarcity of this precious resource in as little as 10 years.
In both water scarce and water rich regions, continued growth of agriculture,
industry and urban consumption patterns drives both increased demand for clean
water and increased costs for controlling pollution and protecting natural
ecosystems.
Yet at the same time as water scarcity is intensifying around the world, and water
pollution is increasing costs of avoiding ecosystem degradation, extreme weather,
floods, and other incidences of excess water are also on the rise.
Managing the implications related to 'too much, too little, or too dirty' water, can be
a challenging undertaking. This booklet seeks provide some context to that
discussion and a few examples of how leading organisations around the world are
managing their water issues.
This booklet sets out:
• A summary of some of the challenges of effectively managing water resources,
• An introduction to PwC’s offerings around the sustainable use and management
of water resources,
• A collection of recent case studies highlighting how PwC clients have driven
forward their sustainable water strategies,
• A few recent reports we’ve issued on water-related business issues, and
• A listing of contacts around the world who you can speak with about these issues
PwC
4
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Global water issues
The growing gap between water resources and water demand
While much of the earth’s surface is covered by water, over 99% is either
saltwater or locked in glaciers (UNEP 2008). While the remaining 1%
must serve all our human needs, the world’s fresh water resources also
have an important role to play in maintaining our natural ecosystems.
What we have:
A limited supply of a resource that is un-substitutable
Yet this limited supply of fresh water has done little to slow growth is
water demand. Global demand for water has increased sixfold within the
past century, more than double the rate of population growth (IWMI
2007). The World Bank estimates that water demand may grow more
than 50% between now and 2030 (World Bank 2007).
Frozen
68.9%
The UN Food and Agriculture Organisation estimates that 2.8 billion
people already live in water-stressed areas and that this could rise to
two-thirds of the world’s population by 2025 (FAO 2011).
Saltwater
97.50%
Water scarcity limits agricultural and industrial contributions to
economic growth, contributes to poverty, and exacerbates
environmental degradation.
Lakes and
Rivers 0.3%
Freshwater
2.50%
Groundwater
30.8%
Source: UNEP Vital Water Graphics 2008.
What we need:
Improved water productivity to serve our growing population
7000
“At The Coca-Cola Company, we are transforming the
way we think and act about water stewardship. It is
in the long-term interest of both our business and the
communities where we operate to be good stewards
of our most critical shared resource, water.”
6000
5000
Water demand per year
increased from about 500
cubic kilometers in 1900
to about 3,830 cubic
kilometers in 2000
Projections into
2030 suggest that
water demand may
outstrip supply by 40%
4000
– Muhtar Kent, Chairman and
CEO Coca-Cola Company
Population
increased from
1.6 billion in
1900 to 6 billion
in 2000
3000
2000
1000
0
1900
1950
2000
Time
Source: World Bank (2007), Water Resource Group 2030
PwC
5
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Global water issues
Increasing levels of water pollution
Water quality is a serious concern in both high- and low-income countries
High-income countries
• About 59% of water is used for industrial purposes, which generates
high levels of pollutants . More than 80% of the world’s hazardous
waste is produced in industrial countries (UN-WWAP 2011).
Low- and middle-income countries
• Although only 10% of water use is for industrial purposes, there is a lack
of sufficient treatment facilities. An estimated 70% of industrial wastes
in developing countries are dumped untreated into waters where they
pollute the usable water supply (UN-WWAP 2011).
Water scarcity exacerbates water quality issues
• In addition to limiting economic growth, contributing to poverty, and
causing environmental degradation, water scarcity frequently has the
effect of worsening water quality.
• The same drivers that increase water demand – population growth and
industrialization – also lead to greater amounts of
wastewater discharge.
• Without proper treatment, this wastewater creates serious water quality
problems. The water quality challenge is further exacerbated as water
scarcity increases, for lower water levels means a higher concentration
of pollutants.
Issues related to water scarcity and water pollution are often
closely related
Quantity
Quality
Drivers: Population growth, industrialization, economic
development, urbanization, and climate change
More water
users
Increased per
capita water use
Greater
amount of
pollutants
Lower levels in surface and
ground water
“Water has been on the Nestlé corporate agenda
long before environmental policies and
sustainability became an issue; the first
wastewater-treatment plant for one of our factories
was built back in the 1930s…We have made huge
efforts to reduce water withdrawals for our
factories. Withdrawals were close to 5 liters per
dollar of sales some ten years ago. They are now
below 2 liters.”
Higher
concentration of
pollutants
Decreased
availability of
clean water
Geographic
concentration
of pollution
Higher levels of
water pollution
Negative impacts
to wildlife and
biodiversity
– Peter Brabeck Letmathe,
Chairman of Nestlé
PwC
6
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Global water issues
Floods, storms and other excess water events
In recent years record-breaking rains, floods, snowstorms and other
water-related natural disasters have impacted developed and developing
countries on every continent.
Whether natural or man-made, flooding events have severe social,
economic and environment impacts. These events are becoming more
frequent and their impacts more widespread. As the effects of climate
change are felt, the need increases to adapt to meet future demands. It is
essential that organisations including government, critical services and
infrastructure operators, and businesses have prepared and maintained
an effective resilience capability to achieve a secure and sustainable
future.
The Intergovernmental Panel on Climate Change special report on
managing the risks of disasters and extreme weather events portrays clear
and growing risks from populations exposed to flood and other waterrelated natural disasters (IPCC 2012). About 800 million people live in
flood-prone areas, and almost one in ten of them is exposed to floods each
year. (UNISDR 2011).
Key considerations :
Floods, storms and other excess water events have exposed the
susceptibility of infrastructure and critical services which sustain our way
of life and maintain safety and security. Over recent years, events
including the 2011 Japanese earthquake and tsunami, severe flooding in
Thailand and Storm Sandy have shown the severe impact to countries,
communities and individuals in and around flooded areas. These events
have exposed inadequacies in the arrangements for response and
recovery from disasters, resulting in a prolonged and increased
disruption at a macro level to economies and society, but also at a micro
level for businesses and individuals.
Adapting arrangements for the
impacts of climate change
Ensuring appropriate investment levels
in resilience and protection of essential
infrastructure and businesses
As well as the direct localised impact of natural disasters, the frailty of
global supply chains for government and businesses alike has been
exposed. The globalisation of supply chains due to increasing efficiencies
and expanding markets means that recent flooding events have led to
disruption of critical resources.
Planning effectively to respond to
disasters using an integrated
approach and capability
Development of legislation and
regulation to manage the impacts
of natural disasters
“Having the ability to manage responsibly and
properly in areas of water scarcity is an enabler to
being in that operation in the first place. Having the
ability to manage excessive water, particularly if
it’s coming in extreme storm events, is also an
enabler.”
Validating arrangements
through training and testing to
ensure that they are robust
Tom Albanese,
CEO Rio Tinto
PwC
7
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Introducing PwC
PwC is a global advisory firm operating in 4 main areas; tax, audit and
assurance, advisory, and legal. It is also the world’s largest professional
services firm.
Audit and Assurance: We provide audit and non-financial assurance
services to water providers and water users around the world.
Recognising that all companies want assurance teams that know their
issues and understand their business challenges, PwC’s water
professionals bring a high level of knowledge to their work.
Advisory
Legal
PwC
Tax
Audit and
Assurance
PwC People
180,520
Advisory: Our advisory practice puts water sector companies and
other water stakeholders at the leading edge. We are able to deploy
trusted water specialists with unparalleled knowledge of business
processes in-depth expertise around areas like: business planning,
compliance and risk management, to project financing, capital asset
management, and accounting expertise.
Global coverage:
158 countries
776 locations
Tax: We have a specialist Sustainability and Climate Change Tax team,
which is made up of an international network of professionals with an
in-depth knowledge of both local and international markets and their
tax regulations.
Legal: PricewaterhouseCoopers Legal LLP and other legal firms within
the PwC global network assist project developers, investors, banks,
plant constructors and service providers with feasibility and business
case studies through to completion and disposal of projects.
PwC
8
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
PwC sustainability services
PwC’s Sustainability and Climate Change team helps both public and private sector clients address the specific and immediate issues relating to
sustainability, as well as helping with longer-term strategic thinking. The team has a unique blend of skills, experience and tools, as well as scale and
reach in all service areas. PwC’s global sustainability practice includes 700 practitioners operating over 60 countries. The team offers services across at
least 6 main areas: (1) Strategic sustainability, (2) Governance, risk and compliance, (3) Supply chain and operations, (4) Policy and economics, (5)
Assurance and reporting, and (6) Tax and the regulatory environment.
PwC
Sustainability
Services
PwC
9
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
How we can help
PwC in the water sector
PwC is a leading provider of professional services to regulated and non-regulated utilities in the water sector. We are committed to adding value to our
clients and believe an in-depth understanding of industry issues is central to the delivery of services to those in the water sector.
For water infrastructure, PwC support extends across the asset lifecycle, from planning, financing, tender and procurement to construction,
operations, resilience and disposal.
Infrastructure
Financing
PwC
Public-Private
Partnerships
Portfolio
Management
Risk
Management
10
Organisation
and
Infrastructure
Resilience
Emergency
Management
and Business
Continuity
Integrated
Water
Resource
Management
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
How we can help
PwC and water users
Water issues impact not just those in the water sector, but water users as well. From agriculture to extractives to consumer goods and beyond,
companies across all sectors are recognizing the importance of water to their operations and building robust water management strategies.
Companies often start this journey by quantifying their water usage and its socio-economic and environmental impacts. From there they are in a better
position to put in place systems to manage water-related risks and take advantage of water- linked opportunities. Finally, internal and external
stakeholders are increasingly driving water users to disclose their water usage and water stewardship activities.
Assurance &
standards
• Data
• Controls
• Systems
Measurement
• Water footprint
• Lifecycle
assessment
Reporting &
disclosure
• Water
reporting
• Integrated
reporting
Opportunities
• Cost savings
• New markets
• Technologies
PwC
Impact
Assessment
• Social
• Economic
• Environmental
Risk Management
• Physical
• Regulatory
• Reputational
11
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Water foot-printing in product life-cycle assessment for a major fastmoving consumer goods company
Business challenge
Benefits and value
The client wished to build its
understanding of the relative impacts of
environmental, social, and commercial
sustainability issues, including water
consumption and water emissions
(e.g. eutrophication). Its aim was to
identify, evaluate and prioritise these
issues and their potential impacts for the
business across the value chains of its
products.
The product sustainability impact
assessments conducted by PwC helped
the client to understand and prioritise
the key issues impacting its businesses.
For example, it showed that the greatest
impacts were not within the client’s own
operations but within its agricultural
supply chains.
The assessment was also used to help
inform the client’s overall sustain
ability strategy.
Solution and approach
PwC led a review of two of the client’s leading brands to identify and map top-tier
sustainability issues across the value chain for a typical product.
The work included qualitative and quantitative assessment to quantify the water
and carbon footprints of the products, using a range of life-cycle analysis
techniques, input from internal and external experts, and research of production
economics across the product value chain. The analysis identified water as a key
issue for prioritisation, especially in water-scarce regions.
The work was then used to support a series of three-day raw materials workshops
with the client’s R&D and procurement teams globally. The approach involved
developing potential ‘2020 scenarios’ to explore the future implications for
sourcing key raw materials.
PwC also helped the client with a similar project focused on a third brand, which
involved calculating the water and carbon footprint and analysing water and
carbon issues along the product value chain.
PwC
12
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Developing an environmental profit and loss (EP&L) account for Gucci
Business challenge
Benefits and value
Kering wanted to develop
environmental profit and loss (EP&L)
accounts for each of their brands in
order to understand the environmental
impacts across the value chain,
including water availability and
pollution. Following the success of the
PUMA EP &L, Kering committed to
develop a Group wide EP &L by 2015.
Starting with one brand, Gucci, to pilot
the improved methodology.
Kering has gained confidence in the scale of its
environmental impacts as well as new insights
into high impact processes and locations. The
EP&L has provided Kering with:
•
a tool to educate stakeholders
•
a deeper understanding of its supply chain
and to build stronger supplier relationships.
•
a driver for innovation in product design,
supply chain management and operational
efficiency.
•
a positive reputational impact through
reporting transparency and brand
leadership
Solution and approach
Since 2011 PwC have been working with Kering to further develop the EP&L methodology, with a
particular focus on aggregating management useful information.
Following joint decisions on what information is required to best represent Kering’s activities and
supply chain for the EP&L, PwC engaged with the brands and its suppliers to gather valuable new
information.
PwC quantified Gucci’s environmental footprint – including water consumption, water pollution,
greenhouse gases, air pollution, waste and land use - across the entire supply chain. PwC
developed a state-of-the art hybrid modelling approach, which combines the strengths of multiregional environmentally-extended input output modelling (PwC ESCHER), regionalised Life
Cycle Assessments (LCA), and material flow analysis (MFA) with directly available client data.
The environmental footprint was calculated for 129 regions to allow the material implications of
regional differences to be considered. Following the quantification, regionally specific monetary
values were calculated based on detailed, impact pathways.
To enable Kering to produce results themselves and operationalise the E P&L as a management
tool, PwC delivered training sessions and built capacity within Kering and the Brands.
PwC
13
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Ground water management strategy and impact monitoring review
Business challenge
Benefits and value
The client required a review of its
long term strategic position with
respect to the management of
ground water and to evaluate the
current operational status of
groundwater management and
monitoring practices at operational
level. An increase in concern with
regard to the potential financial and
criminal liabilities associated with
ground water impact was the main
driver for the review.
The review has highlighted a
number of areas where
improved ground water
management practises could
be deployed.
Solution and approach
PwC brought together a team of subject matter experts including
hydrogeologists to perform a adequacy review of the corporate level
ground water management framework and other associated ground water
management governance documentation. Furthermore, a sample of
operations were selected for site visits where the implementation of the
framework and strategy were assessed. The adequacy of technical ground
water management practises and monitoring reports were evaluated for
“fatal flaws” based on the risk level of ground water pollution.
The review focussed on aspects such as:
• The adequacy of the ground water monitoring network design e.g. Consideration of geophysics;
• Completeness of point and disperse pollution sources;
• Monitoring borehole design;
• Chemical analysis element completeness;
• Frequency of sampling;
• Surface and ground water interaction;
• Consideration and location of background ground water monitoring boreholes;
• Adequacy and consideration of hydrocensus information with regard to sensitive receptors;
• Sampling and analysis integrity; and
• Adequacy of presentation of monitoring results in management reports to assist risk based decision making.
PwC
14
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Water management practices for a major global beverage
manufacturing company in India
Business challenge
Benefits and value
The client, a leading global foods and
beverages manufacturer, wanted a
review of the water conservation
practices at select sites of in India in
order to: (1) assess its existing water
management practices; and (2) identify
gaps in operation/monitoring practices
to highlight areas for improvement.
An ongoing engagement, we have
assisted the client with their first
sustainability report which included
formulating a system for data
collection on water use and recharge
across the entire reporting entity as
defined by the client.
Solution and approach
Tasks performed by PwC to support the client included the following:
• Assessment of the client’s sustainability strategy, goals and priorities with respect to
water management across operations, community and agricultural practices
• Water management review based on Global Reporting Initiative (GRI) indicators, the
GRI Water Protocol and the client’s
own policies.
• Review of water management practices at select beverage producing units.
• Review of rainwater harvesting initiatives implemented by the client within their
manufacturing plants as well as in the local communities surrounding their plants.
• Review of the sustainable agriculture initiative undertaken by the client to promote water
conservation through changes in the traditional paddy cultivation practice in various
parts of India.
• Assessment of net water consumption based on the client’s aspirations and goals in the
area of water management.
• Assistance with the identification of gaps and sources of uncertainty in this review, and
comments on how to address these issues to improve monitoring in all areas
of operation.
PwC
15
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Greenhouse gas and water reduction cost-curve modeling for mining
operations
Business challenge
Benefits and value
To help respond to the social and
environmental impacts of their business,
a global mining giant issued a group
requirement whereby facilities that
exceed specified water consumption
and greenhouse gas (GHG) emission
thresholds develop cost curves for GHG
and water reduction opportunities.
This assignment was used by the
client to identify and prioritise cost
effective greenhouse gas and water
abatement opportunities for
implementation and provide input
into a Group level greenhouse gas
and water reduction target.
As a part of this global initiative, we
were engaged by the client to investigate
and develop greenhouse gas and water
abatement cost curves at three mine-site
locations.
Solution and approach
Our approach involved:
• conducting and facilitating workshops
with local operations to identify abatement
opportunities;
• screening and costing the identified
projects; and
• modelling the abatement options to derive
a cost per unit of greenhouse gas and
water abated.
PwC
16
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Project in focus
Assessing the role of water in BASF’s global supply chain
Business challenge
Benefits and value
Chemical company BASF recognized
that supply chain management is
increasingly important and water is a
key sustainability issue.
PwC delivered new knowledge to BASF
and specified key implications for risk
management, sourcing processes and
strategy development.
BASF’s wanted to identify freshwater
consumption hotspots in its supply
chain to prioritize risk management
efforts. BASF also looked for guidance
to include the identified water
materiality issues into respective
sourcing processes and internal
supplier benchmarking.
BASF will apply these insights and put
them into action. This in turn will
increase BASF's resilience to water
risks.
Moreover, BASF aimed for a holistic
picture of strategically relevant supply
chain effects. Therefore BASF wanted to
consider other KPIs such as GHG
emissions (so-called “scope 3”) and
value added throughout the supply
chain to reflect nexus considerations.
Solution and approach
To satisfy BASF’s objectives, PwC selected ESCHER
methodology.
ESCHER results also allowed a structural path analysis of the
suppliers. This revealed exposure characteristics of tier 1, tier 2
and tier n suppliers and their water consumption respectively
GHG emissions.
ESCHER results also detailed strategic findings for emerging
and developing economies, detailing country risk for BRIC and
"Next 11" countries. ESCHER also sheds light on the financial
implications emerging from potential increased of water prices.
PwC
17
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
The water sector
The foundation of PwC’s expertise in water issues lies in decades of tax, assurance and advisory support we have offered for the water sector. Water
resources are managed differently around the world and PwC’s global network brings access to deep local knowledge of local water regulations and
water issues.
Country Client
Brief description
UK
Ofwat
PwC is Ofwat's delivery partner for the 2014 price review.
We will provide advice, analysis and assurance through the
price control process. In order to create a more efficient,
dynamic and customer focused sector which could generate
more than £2 billion of benefits.
Crossterritory
United National PwC completed a study aimed at illustrating the underlying
Environmental challenges of Public-Private-Partnerships (PPPs) by offering
Programme
a thorough review of twelve projects in the water sector,
implemented either successfully or unsuccessfully over the
last decade in various regions of the world.
France/
Morocco
Office National PwC advised the client on the economic, financial, legal and
de l’Eau Potable technical feasibility of a PPP arrangement for the Agadir
desalination water treatment plant in Morocco. The project
aimed to build, operate and transfer a 200,000 m3
desalination unit.
India
Government aid PwC assisted in reforming the planning and delivery of
organisation
urban services in the Indian state capitals of Gangtok and
Shillong. The project focused on water supply, sanitation,
sewerage and solid waste (garbage) management services
for poor populations.
Europe
European Union PwC helped the EU complete a prospective socio-economic
study on the strategy of municipal water investments,
financing strategies, and pricing consequences in 5 EU
countries and 5 new or future members.
UK
Water utility
PwC
The client had embarked on a change agenda comprising of
a number of major transformation projects over the next
three to five years. PwC supported the set up of a
programme management model to enable the identification
of project inter-dependencies and implement processes that
report the rapidly changing risk profile of the organisation.
18
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how (continued)
The water sector
Country Client
Brief description
India
Nongovernmental
water advocacy
organisation
PwC helped implement a project to improve the water
quality of the Yamuna River along its identified polluted
stretches. The first phase involved pollution abatement
works in 15 towns in Delhi, Uttar Pradesh and Haryana
provinces. The second phase created requisite capacity for
sewage treatment in the towns and contributed to a
significant capacity-building programme among local
agencies.
Oman
Municipality
PwC acted as financial advisor to a municipality seeking to
privatise its wastewater system by way of concession. PwC
assessed options allowing the private sector to take over all
the existing assets and refurbish and extend the existing
system.
Saudi Arabia Government
agency
PwC was appointed lead financial advisor to assess the
financial implications of operating, managing and
maintaining Riyadh’s water and wastewater systems on a 20
year private sector operating concession.
France/
Romania
Government
agency
PwC advised on the evaluation and critical analysis of the
Bucharest concession contract for water and sanitation, a
project serving over 2 million customers. The project aimed
to better understand its contribution in terms of sustainable
development, cost/benefits, water pricing, consumer
satisfaction, and positive municipality/operator partnership
Australia
Government
agency
PwC advised on the construction and operation of the
world’s largest reverse osmosis desalination plant,
associated inlet/outlet structures, transfer pipeline and
power supply infrastructure. The project involved raising
billions in private finance and received Project Finance
International’s PPP Deal of the Year award.
US
Inter-American
Development
Bank
PwC helped the client to prepare a report setting out an
approach and a set of tools for the financial structuring of
PPPs in the potable water and sanitation sector.
PwC
19
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how (continued)
The water sector
Country Client
Brief description
Romania
Government
agency
The first objective of this project was to help the government
of Romania and 4 municipalities (Alexandria, Calarasi,
Giurgiu and Slobozia) to improve their financial and
technical performance and to comply with EU regulations
and Directives, especially as regards the evaluation of
investment needs, sustainable cost recovery principles and
financial strategies. The second objective was to provide an
assistance for institutional capacity strengthening.
UK
Water utility
We were engaged by a UK water company to advise on their
opex efficiency and opportunities for opex outperformance.
The work involved detailed analysis of their opex costs.
Based on our analysis we outlined the main areas of
inefficiencies and recommended actions to amend these.
UK
Large utility
We provided expert regulatory and specialist corporate
finance advice to the pension trustees of a large UK based
utility regarding the strength of the pension covenants based
on the company’s respective sector activities. The advice
covered the regulatory and statutory frameworks and
protections as well as financial modelling of the company’s
financial and credit metrics with regard to the credit
worthiness of the companies under different transaction and
unbundling scenarios
UK
Water utility
Developed a high level strategy for progressing value
creation opportunities aligned to its business strategy and
move towards a world class position in relation to corporate
responsibility.
UK
Water utility
PwC were asked to perform a short diagnostic on a
company’s joint regulatory and engineering led Modern
Equivalent Asset Valuation (MEAV) which was running
over-budget. Within three months we provided a robust
MEAV model.
PwC
20
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Measurement
For many organisations, the first step in managing water is measurement, since what’s not measured, won’t get managed. Effective water management
requires an understanding of both water quantity and water quality performance.
Country Client
Brief description
Japan
Financial
institution
Development support for "Environmental Rating Loans with
the Evaluation of Natural Capital Preservation” to factor in
key environmental impacts (water use, CO2 emissions, land
use) of the loan recipient’s supply chain.
Chile
Wood product
company
PwC assessed the water footprint of a paper mill company in
order to gain an understanding of green water consumption
in the paper and packaging industry.
Chile
Global mining
company
PwC worked with the client to identify projects that could
reduce high quality water consumption, using marginal
abatement cost curves to ascertain which projects optimized
water abatement and financial results. PwC also helped the
company to identify and analyze current consumption levels
and build a companywide water forecast model.
PwC
21
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Impact assessment
Companies can often create adverse impacts on local water resources. Quantifying the water-related impacts a company has on neighbouring
communities, economies, and ecosystems is a fundamental aspect of understanding its overall sustainability impacts.
Country Client
Brief description
UK
PwC was commissioned by Defra to undertake a study of
infrastructure investors and operators and long-term (20+
year) climate change adaptation action in the water, energy,
transport, and information, and ICT sectors, and how
Government and regulators could support this.
Defra
The project included mapping the current regulatory
framework, identifying key market developments, and
possible techniques for assessing the adaptation investment
decisions, and developing recommendations for
opportunities and levers to facilitate long-term climate
adaptation action in infrastructure development.
UK
National
organisation for
globally exported
textile consumer
goods
The client wished to build an understanding of the relative
impacts of environmental, social, and commercial
sustainability issues in its industry, including water
consumption and water pollution. PwC helped to identify,
evaluate and prioritise these issues and their potential
impacts for the industry across the value chains of its
products.
UK, US,
Germany
World Business
Council for
Sustainable
Development
(WBCSD)
PwC is among the core group of companies working with
the World Business Council for Sustainable Development to
share experiences on the use of water valuation to support
informed business decision making.
The project’s first report on the underlying business cases
for undertaking water valuation was released at World
Water Week in Stockholm in 2012. An expanded reference
guide, including reviews of over 23 case studies of water
valuation in business decision making is due to launch at
the IUCN’s World Conservation Congress in Korea in
September 2012.
PwC
22
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Risk management
Water-related risks can manifest through a company’s value chain. For example, water pollution often necessitates additional investment in pretreatment systems, while water scarcity can disrupt operations and increase prices of key material supplies. Understanding and mitigating these risks
is an important part of a comprehensive corporate risk management strategy.
Country Client
Brief description
Brazil
Grupo Camargo Corrêa is one of the largest Brazilian private
conglomerates, composed of heavy construction, cement,
energy and transport companies with operations mainly in
Latin America and Africa. The project included the
development of high level guidelines for water management
within the group.
Grupo Camargo
Corrêa
South Africa Major global
PwC was tasked to perform a review of a water balance
metals and
model developed by a major metals and mining company at
mining company one of their more complex operations.
The objective of the review was to evaluate the process
followed to compile the final content, including
assumptions, variances, scientific formulas and definitions
applied in the water balance model.
Australia
PwC
Global mining
company
PwC worked with the client to evaluate the costs, benefits
and risks of a range of options to meet projected shortfalls
in water supply associated with an expansion of operations
in the Pilbara region of Western Australia.
23
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Risk management (continued)
Country Client
Brief description
UK
Large food
retailer
Being strongly dependent on food related inputs, the client
was increasingly concerned about the impact of climate
change on water scarcity and temperature and how this
might affect food security and the organisation. We were
asked to conduct technical and financial outputs providing
product and country analysis across a wide range of
agricultural supply chains.
UK
Leader of
sustainability
public interest
group
PwC built a model to identify and assess the potential impact
of water scarcity on electricity and water utilities, including
the extent to which associated risks are currently reflected in
public disclosure.
UK
A major thermal
power
generation
company
The client was critically dependant on a high-reliability
water supply for power station cooling and ancillary
purposes. PwC helped the client value the impact of reduced
supply reliability and provided advice on mitigating
strategies.
Crossterritories
Global mining
company
PwC led a review of two of the client’s leading brands to
identify and map top-tier sustainability issues across the
value chain for a typical product. Water was a key issue for
prioritisation. The approach involved developing potential
‘2020 scenarios’ to explore the future implications for
sourcing key raw materials.
PwC
24
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Opportunities
Water presents a significant business opportunity for many companies. Some may be able to find cost savings through implementing water efficiency
projects, while others can use water-related products or services to generate new revenue.
Country
Client
Brief description
India
Asian
Development
Bank/
Government of
Bangladesh
The objective of the assignment is to assist the Government
in making a fully functional water team in the Policy Support
Unit (PSU) of the Local Government Division (LGD), by
developing the necessary rules and standards for regulating
and monitoring water utilities operating in the urban sector.
UK
Major global
beverage
manufacturing
company
PwC assessed the water conservation practices at select
Client sites in India in order to: (1) assess its existing water
management practices; and (2) identify gaps in
operation/monitoring practices to highlight areas for
improvement.
France/
Japan
Water
equipment
manufacturer
association
PwC supported an association of Japanese water equipment
producers to assess the experience of the private sector in
PPPs for water infrastructure in the last 15 years, focusing
on potential business opportunities in
South East Asia.
China
Veolia Water
PwC assisted Veolia Water Asia Pacific be a responsible
water steward by implementing a new sustainable
development policy across three water infrastructure
projects in China.
PwC
25
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water users – Reporting and disclosure
Increasing expectations from investors, customers, and non-governmental organisations are driving companies to improve how they communicate
their water risks, impacts, and opportunities. Water disclosure has become a key aspect of corporate communications for companies in water-intensive
sectors or those operating in water-stressed areas.
Country Client
Brief description
US
PwC is helping the CEO Water Mandate, a global
organisation of 86 corporations committed to water
sustainability, to analyze existing corporate water disclosure
practices and to draft the first global Corporate Water
Disclosure Guidelines.
United Nations
CEO Water
Mandate
The Guidelines put forward common metrics that can begin
to harmonize practice, and also provide guidance for
determining report content and aligning water disclosure to
stakeholder interests. Ultimately, the Guidelines will help
investors assess and compare water-related risk by driving
convergence in the ways companies report on water issues.
They will also minimize the reporting burden on companies,
thus allowing them to allocate more time and resources to
managing water in a responsible manner.
Project technical advisors include the Carbon Disclosure
Project, the Global Reporting Initiative and the World
Resources Institute.
PwC
26
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Who we’ve assisted and how
Water sector and users – Assurance and standards
PwC provides assurance and verification services over sustainability reports for a wide range of water sector companies and water users. As water
becomes an increasingly valuable resource, having credible information corporate water impacts will become an increasingly important
strategic differentiator.
Selected PwC sustainability assurance clients
Abengoa
Greenergy
RAY
Aguas Andinas
Gas Natural
Royal Sun Alliance (RSA)
Águas de Portugal
Hansel
Rio Tinto
Anglo American
Holcim
Roche Group
Bank of China
HSBC Holdings PLC
Samsung Electronics Co
BG Group
IPF
Sanofi-Aventis
BHP Billiton Base Metals
Kesko
Senaatti-kiinteistot
BP
Kyocera
Shell International
CAPP
L’Oréal
Siam Cement Group
Cenovus
LEGO
Suncor
Cheminova
Limited Brands, Inc.
Syngenta
China Construction Bank
MAN SE
Talisman Energy
China Development Bank
Metso
Tamro Group
Coca-Cola GmbH
Michelin
TelecomItalia
Codan
Mitsubishi Corporation
Telus
Copenhagen Airport
MTR Corporation
TIM
Daimler
Natura
TNT
Dong Energy
Neste Oil
TOP-TOY
Eczacibasi Group
Nestle
TransAlta Corporation
Eletrobras
Next
VandCenter Syd
Encana
Novartis
VANOC
Enmax
Novo Nordisk
Vestas Wind Systems A/S
EPCOR Utilities
Novozymes
Volkswagen Group
Experian
Office Depot
Votorantim Cimentos
Faerch Plast
Penoles
Winthrop Arzneimittel GmbH
Fortum
POSCO
Zywiec Group
PwC
27
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Thought leadership
PwC’s thought leadership and depth of knowledge have enabled us to satisfy our clients’ business needs and surpass their expectations by offering
proactive solutions that identify and capitalize on trends. Here is a selected list of relevant publications. You can download these and more at:
www.pwc.com/sustainability
PwC
Water: Challenges, drivers and solutions
June 2012
Ahead of the World Water Forum, PwC has
published a report on the dynamics and patterns
of water management to support the development
of models for tomorrow.
Bringing Water to your doorstep
April 2011
This report aims to assess the issues faced by the
urban water supply sector in India; contemplate on
the relevance of international models in the Indian
context and present a comprehensive reform agenda
covering all dimensions including financing,
institutions, PPP, resource sustainability and
capacity building.
Roadmap to reform of the UK water sector
October 2012
The proposals in the UK Government’s draft
Water Bill, Water White Paper, Ofwat’s Future
Price Limits project, and other publications will
have far reaching impacts on water companies’
and investors’ strategies and business operations.
China’s war on water scarcity
Spring 2013
China provides the perfect example of a developing
nation grappling with urgent water issues. The United
Nations, which lists China as one of 13 countries
contending with serious water scarcity, says it has
21% of the world’s population, but only 6% of its
freshwater.
10 minutes on Managing water scarcity
March 2012
To prepare for the consequences of water scarcity,
companies must monitor water use, evaluate
water scarcity risk across the entire supply chain,
and collaborate with local communities on
replenishing water supply.
The true value of water
June 2011
The lack of clean fresh water is an essential threat not
only to individuals, but companies also face
significant risks if water is scarce. This is a best
practice guide from PwC to show how companies can
handle this challenge.
28
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Contacts
About PwC’s Global Water Network
PwC provides industry-focused assurance, tax, legal and
advisory services to its clients and their stakeholders. More
than 180,5200 people in 158 countries across our network
share their thinking, experience and solutions to develop
fresh perspectives and practical advice.
Gary Sharkey
Global Sustainable Water
Network Lead
+44 (0) 20 721 34658
PwC’s water network operates out of 13 hubs, spread
between 6 regions, to bring our clients access to our
broader global capability and expertise. We would be happy
to begin a discussion with you on how water issues may be
impacting your organisation.
[email protected]
Europe and Russia
Germany
France
Matthias Retter
+49 30 2636 3092
[email protected]
Guy Leclerc
+ 33 (1) 5657 8230
[email protected]
Emilie Bobin
+ 33 (1) 5657 8660
[email protected]
Luxembourg Pierre Wauthier
+352 (0) 494848 4506 [email protected]
Switzerland
Francisco Betti
+41 (0)58 792 9453
[email protected]
Gary Sharkey
+44 (0) 20 721 34658
[email protected]
Richard Laikin
+44 (0) 20 721 21204
[email protected]
UK
PwC
29
August 2013
Introduction
Global water
issues
Introducing
PwC
Sustainability
at PwC
How PwC can
help
Who we have
Thought
assisted and how leadership
Contacts
Contacts
North America
US
Lauren Kelley Koopman
+1 (646) 471-5328
[email protected]
Lee-Ann Ritzman
+1 (214) 754-5106
[email protected]
South America
Brazil
Cecilia Michellis
+55 11 3674 3440
Chile
Fernando Cordova
+56 2 29400585
[email protected]
[email protected]
Argentina
Perla Casella
+54 11 4850-4761
[email protected]
Africa and the Middle East
UAE
Gus Schellekens
Dr. Ferdi Linde
South Africa
Jayne Mammatt
+971 (0) 2 6946435
[email protected]
+27 (11) 797 5195
+27 (11) 797 4128
[email protected]
[email protected]
East Asia
India
Jennifer Möller-Gulland
+91 124 3306000
[email protected]
Ranen Banerjee
+91 124 3306009
[email protected]
SEAC
Elaine Chan
+60 (3) 21730641
[email protected]
Korea
Joonki Min
+82 (0) 27090884
[email protected]
Jae-Heum Park
+82 (2) 37819911
[email protected]
Australasia
Australia
PwC
Craig Fenton
+61 (7) 3257 8851
[email protected]
Richard Pittard
+61 (3) 8603 5024
[email protected]
30
August 2013
PwC
© 2013 PricewaterhouseCoopers LLP. All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers LLP (a limited liability
partnership in the United Kingdom) which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a
separate legal entity.
120813-133824-GS-OS