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Interview Details

Interview with Cate Lamb

  • Head of Water, CDP
  • Dated: Monday, June 2nd 2014
  • EWP: The CDP Report clearly demonstrates the manner in which businesses have quickly come to understand the manner in which water-related risks that could substantially affect their business. According to responses from companies surveyed “In two years, the percentage of companies recognizing the risks that water presents has increased by 17%”. In your perception what has been the principal driver behind this shift?

    Cate Lamb: Unfortunately it often seems to take a catastrophe to grab peoples’ attention and to change behaviour. Generally, significant events such as the 2011 floods in Thailand particularly hit the automotive and IT industries and severe droughts in the USA (last year), have pushed water issues up the agenda. This is further assisted however by the increase in investor interest in how water-related issues may be affecting portfolio companies. The number of investor signatories has almost quadrupled in the past 3 years. Our water questionnaire is now issued on behalf of 530 investment institutions with more than $57 trillion in assets. We heard from one such signatory recently who stated, “ICCR uses CDP water data to understand companies’ water-related risk exposure and water stewardship opportunities. Water scarcity is a priority issue for ICCR, and companies that respond to the questionnaire signal to our investor coalition that they are strategically measuring and addressing water related risks.”

    As a non-profit that works to deliver sustainable economies, CDP works to move the market ahead of where it would otherwise be on environmental issues. Our water program provides the only global, standardized platform for companies to measure, manage and disclose vital water information. By issuing companies with a questionnaire designed to elicit the water data that the markets require, our program is designed to catalyse companies to become better water stewards and to help investors to recognize which businesses are moving in the right direction.

    EWP: The CDP Report states that “The number of investors calling for greater corporate transparency on water has quadrupled in the last three years”. Is certification an opportunity for companies wanting to demonstrate their good water stewardship practices to their investors? Could this be an example of how business can translate their business risks into opportunities?

    Cate Lamb: The number of institutional investors that are signatories to CDP’s water program has risen from 137 in 2010 to 530 in 2013. These signatories represent more than £57 trillion in assets and through CDP, are holding companies accountable for their impacts on water resources. Further, we’re seeing an increase in the number of corporations leveraging their purchasing power to apply positive pressure across the supply chain. For example, organisations, such as Dell, L’Oreal, Pfizer and Unilever are now working with CDP’s Supply Chain program to call for greater transparency of water issues across their supply chains and integrating their findings into procurement specifications and contracts.

    Each of these key stakeholders are seeking assurance that companies have a deep understanding of the impact their activities have upon water resources and the risks this poses to their success. Understanding this, means that they can then proactively address those risks and identify opportunities to safeguard water resources, ensuring they build business resilience and avoid value destruction.

    Water related issues are becoming an increasingly important factor for many companies. Their management boards are becoming aware of the materiality of water scarcity and that robust and collaborative action is crucial. Demand for information is growing among employees, shareholders, regulators and customers to allow them to understand a company’s strategy, risks and growth opportunities in a water constrained economy. Miscalculation or misjudgement in these areas has the potential to have serious repercussions on the viability of an organization and how it is judged and valued by its multiple stakeholders.

    As global prospective buyers and institutional investors increasingly want proof of water risk mitigation and performance claims, water stewardship certification and verification are likely to become a market access issue. Through an independent water stewardship certification scheme such as that offered by EWS, companies will be able to manage this potential risk inherent in the investment and procurement process and demonstrate their commitment to tackling water-related issues while building shareholder confidence.

    EWP: Support for a company operations, particularly in regions of notable water challenges, stems from establishing a level transparency with their stakeholders and the community in which they operate, what about water stewardship is the most effective means of achieving this “license to operate”?

     

    Cate Lamb: Water stewardship demands a truly sustainable approach to water management. This requires a company to ‘know its basin’ and understand the impact it has upon it. Only then can appropriate action be established. The strategy may well include striving for greater efficiency but it should also encompass a range of other activities that will yield greater benefits to the business and their operating environment.

    For example, local water basin priorities may demand a proactive, collaborative approach to water governance, including engagement with communities or policy makers. Anglo American, Exxaro Resources and Rio Tinto, are just some of the companies that tell us they are taking a strategic, holistic approach to water governance. By engaging with communities in which they operate, these companies are finding that being recognized by their stakeholders as a company that does the right thing is making it easier to access new projects and raise capital.

    Water scarcity is fundamentally about understanding water risk and resultant business risk (operational, regulatory, and reputational), but understanding risk is only the beginning of a successful water stewardship effort. Stewardship requires engagement with stakeholders to collaboratively manage water as a shared resource; it is not possible to address the challenges posed by water scarcity alone. The need to engage with other peers and other sectors, non-governmental organizations (NGOs), communities, and governments to develop broad watershed-level approaches to managing water is essential and initiatives such as EWS, provide a useful and effective framework to support companies in their efforts.

  • Cate Lamb
  • Head of Water, CDP
  • As the head of CDP’s water program, Cate is responsible for ensuring that the program remains the gold standard for disclosure of corporate water-related information globally and moves rapidly to deliver significant changes in corporate behaviour to safeguard water resources. With 10 years experience in the environmental and sustainable development fields and a strong technical, scientific and project management background, Cate has successfully led on a range of high profile projects in the healthcare, construction, education, commercial and regeneration sectors. Cate serves as a board member of the Alliance for Water Stewardship and has a BSc in Environmental Science from Lancaster University.
Water stewardship demands a truly sustainable approach to water management. This requires a company to ‘know its basin’ and understand the impact it has upon it. Only then can appropriate action be established.

- Cate Lamb
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