Big Food's Lax Attitude on Water Use Comes at a Cost

Many big-name food brands such as Hershey, Kraft and Perdue are wasting water resources through lax conservation practices and poor planning.  And as climate change and other factors amplify the water risks plaguing the food industry, the bottom lines of these companies will suffer unless they change course, according to a new report.

The Boston-based sustainability group Ceres ranked 37 of the top food sector companies globally on their water risk management in a study released Thursday.

"For most of these companies their business model is premised under the assumption that there will always be cheap, plentiful water to grow the produce, to grow the grains that they use," said Brooke Barton, senior water program director at Ceres and one of the study's co-authors.  "And that assumption needs to shift."

Ceres' study, "Feeding Ourselves Thirsty:  How the Food Sector is Managing Global Water Risks," identified five issues threatening the food industry: competition for water; weak regulation; aging and inadequate infrastructure; water pollution; climate change and weather variability.

Most of the 37 companies are public, U.S.-based and appear on the S&P 500 and Russell 1000 indices. There were four categories of companies: agricultural products, beverage, meat and packaged food. All businesses were rated on a scale of 0 to 100 based on how their businesses address water use and management. Ceres used data from public disclosures.

Fewer than 17 percent of the companies—only six—scored above 50; the top scorer was the U.K.-based Unilever, owner of several ice cream brands such as Ben & Jerry's and Klondike bars, with 70 points.

On the opposite end of the spectrum, 10 companies scored less than 10 points. Pinnacle Foods, owner of Aunt Jemima maple syrup and Celeste frozen pizzas, and Monster Beverage Corporation, maker of Monster Energy drinks, each scored only 1 point.

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