Water stewardship is the use of water that is socially equitable, environmentally sustainable and economically beneficial. Water stewardship isn’t just an environmental “nice to have” for consumer brands any longer; it is a core business issue that touches costs, supply security, brand value, regulation and long‑term growth.
Why is it important for the consumer sector?
The consumer sector runs on water: it underpins almost every part of the value chain, from agriculture and raw materials to manufacturing, logistics and packaging. When you factor in indirect (supply‑chain) use, many consumer companies depend on thousands of litres of water for every litre or kilogram of product sold. That exposure is a risk if water becomes scarce, polluted or more tightly regulated.
Water stewardship is critical for the consumer goods sector because it ensures responsible use and protection of water across the value chain and reduces exposure to water‑scarce, drought‑prone regions. As a climate resilience strategy, it lowers supply‑chain and regulatory risks, safeguards ecosystems and communities that underpin raw material production, and strengthens brand trust through transparent and equitable water practices. Major consumer goods and food and beverage companies such as Unilever, Nestlé, Coca‑Cola, PepsiCo, Diageo and Colgate‑Palmolive, as well as apparel leaders such as Nike and H&M, are already prioritising water stewardship to protect their sourcing regions and manufacturing hubs. In the food service and hospitality space, brands such as Starbucks, McDonald’s, Yum! Brands (KFC, Pizza Hut, Taco Bell) and Compass Group are also investing in water‑efficient operations and water‑smart sourcing to reduce risk and respond to customer expectations.
Consumers are more aware of the environmental toll caused by plastic waste, and businesses are feeling the pressure to move away from single‑use plastics. This focus on plastics is closely linked to water stewardship, as plastic pollution heavily impacts rivers, lakes and oceans, further reinforcing consumer concern about how companies manage natural resources.
Sustainability is primary for consumers
Deloitte’s 2023 report found that “about four in five respondents say they want businesses to do more to enable consumers to make more sustainable purchasing decisions.” Sustainability has become a primary concern for consumers because it now directly connects to their health, values and sense of future security. People increasingly recognise that issues such as climate change, water scarcity, plastic pollution and biodiversity loss are not abstract problems, but forces shaping food prices, product safety and community wellbeing.
As information becomes more transparent, consumers can see the social and environmental impacts behind what they buy — from working conditions and animal welfare to deforestation and carbon emissions — and many want their purchases to align with their ethical beliefs. This is particularly relevant for global brands such as Procter & Gamble, L’Oréal, Mondelez and Mars, which are under mounting pressure to demonstrate measurable progress on water, climate and packaging across their portfolios.
Risks associated with water
Water poses a set of interconnected risks for the consumer sector that directly affect business continuity and growth. Physically, droughts, floods and declining water quality can disrupt operations, reduce agricultural yields, increase treatment and input costs, and threaten the reliability of supply chains, especially for water‑intensive commodities such as grains, cotton and livestock. Regulatory risk is rising as governments tighten abstraction limits, strengthen discharge standards, raise water tariffs and require more detailed disclosure, leading to higher compliance costs and potential constraints on production. At the same time, reputational risk is significant: communities and non-governmental organisations increasingly challenge companies seen as overusing or polluting local water resources, which can quickly escalate into global brand damage in a sector built on consumer trust. Finally, investors now view water as a material financial risk, pressuring companies to demonstrate credible water stewardship, robust risk management and transparent reporting, or face weaker environmental, social and governance ratings and potentially higher costs of capital. For multinational consumer and food service companies operating in water‑stressed regions — from bottled beverage manufacturers to quick‑service restaurant chains — managing these risks proactively is becoming central to long‑term resilience and competitiveness.
