Drought, floods and water scarcity are worth $14 bln. to business in 2016

Posted in Climate on December 24, 2016

Droughts, floods, water shortages and other problems related to water resources have cost businesses 14 billion US dollars this year. For comparison, they have cost more than five times less - or 2.6 billion in 2015. In the same time, companies are not doing enough to protect themself from water hazards.

Creator of the report is the environmental organization CDP, which published and presented his research Tuesday at a summit on climate in Marrakesh, Morocco. The report consulted over 1,200 of the largest companies worldwide in sectors at risk of water shortage. Just over 600 of them responded, which means that the figure 14 billion is probably much less than the real price umber.

Participating companies, which include consumer products giant Unilever and oil and gas company Suncor Energy, are measured according to a number of factors such as their efforts to track water usage and their goals for savings in water resources.

Much of the cost increase is related to the Japanese energy giant Tokyo Electric Power Company (Tepco), which invests 10 billion last year for treatment of contaminated groundwater from nuclear plant Daiichi, destroyed during the devastating tsunami in 2011 .

Over a quarter of companies said that problems related to water, including floods and pollution have affected them, due to higher operating costs and problems in production.

"Every business in every sector needs water in one form or another," recalls Morgan Gillespie, head of "water" in the CDP. He emphasized that policies targeting risks associated with water resources are vital for the continuation and stability of business processes and the possibility of an adequate response to climate change.

Many companies rely on water to carry out a number of operations, but water supplies are running low in many parts of the world and this is due to excessive use of resources. This process is getting much stronger by the effects of climate change. More and more companies prioritize measures to curb and adapt to the impacts of climate change in their sustainability efforts. But business still does not act adequately and timely to deal with the risks associated with water resources, the report said.

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