Almost two-thirds of companies failed to disclose information on water risks to the CDP.
In its annual report on the issue, the non-profit organisation (formerly the Carbon Disclosure Project) said that 62% (668) of companies failed to provide data for its annual survey on corporate water stewardship. It is particularly concerned about persistent non-responders and said that next year it will begin listing the largest of these in its report.
Exposure of companies' assets, products and supply chains to drought, flood and water pollution is of increasing interest to investors, CDP said.
Last month alone, 60 institutional investors managing a total of $2.6 trillion in assets urged more than a dozen big food and drink companies to reveal water risks via the CDP. More than four times the number of investors backed the 2015 survey compared with 2010, when CDP launched the annual benchmark on corporate water stewardship.
Among UK companies that declined to participate in this year's survey or did not respond at all were Kingfisher, Marks and Spencer, Sports Direct, Tesco, BAE Systems and BP.
CDP highlights the oil and gas sector as being particularly poor at meeting investor demands for transparency and action. Less than a quarter (22%) of the world's largest publicly listed energy companies responded to CDP's request from investors, compared to the average disclosure rate across all sectors of 38%.
The survey also found that:
- just 24% of companies require key suppliers to report to them or include suppliers in corporate water risk assessments;
- almost half (48%) are failing to conduct comprehensive monitoring of water withdrawals and discharges; and
- a quarter (26%) claim to consider water issues within the context of river basins, with just 12% considering other river basin stakeholders, such as their suppliers, in water risk assessments.
CDP also found that just 11% of companies had in place robust and comprehensive water policies. It recommends that policies cover the whole company-wide; establish performance standards for direct operations and supply chains; set out clear goals and guidelines for action; and recognise that access to water, sanitation and hygiene are a human right.
For the first time, CDP has named the companies it considers top performers on water management. These are: Asahi Group Holdings, Rohm Co and Toyota Motor Corporation from Japan; Colgate Palmolive and the Ford Motor Company from the US; Harmony Gold Mining and Kumba Iron Ore, from South Africa; and Metsä Board from Finland.
Cate Lamb, head of water at CDP, said: "Just as oil was to the 20th century, water is fast becoming the defining resource of the 21st century. Unfortunately however, unlike oil, there is no replacement for water. Companies using CDP's water program are beginning to understand that taking a strategic view of how they manage water can enhance competitive advantage, investor appeal and business resilience."
