Water Footprint Benchmarks

A water footprint benchmark is a standardized measure used to assess and compare the water consumption associated with products, processes, or activities. It quantifies the amount of freshwater used throughout a product’s maunfacturing process, from raw material to finished product. By providing a clear picture of water usage, the benchmark helps identify opportunities for efficiency improvements and resource optimization. 

The benchmark aids industries, policymakers, and consumers in making informed decisions to minimise their environmental impact. Companies can adopt water-saving technologies, optimise processes, or source materials from regions with abundant water. Consumers can choose products with lower water footprints, thereby reducing their overall environmental impact. Additionally, governmental organisations can use benchmarks to develop policies and regulations that promote sustainable water management and mitigate water-related risks.

Water footprint benchmarks have been carried out for agricultural crops and products, but they can and should be conducted by and for many other sectors, notably the financial sector.

Water Sustainability Benchmark for Financial Institutions

In 2018, Water Footprint Network and Water Footprint Implementation developed and implemented the first Water Sustainability Benchmark for Financial Institutions. The aim of the benchmark is to establish best practices for water within the financial sector. 

The need for such a benchmark arose from increasing water-related risks to Financial Institutions and a lack of policies and strategies to manage them. Furthermore, water often falls below the radar of materiality assessments for both Financial Institutions and the companies they offer their financial services to.

To tackle this gap in risk and impact perception, the benchmark was applied to the world’s 50 largest International Financial Institutions. The results show that these institutions do not sufficiently consider water. This puts our financial assets and environmental resources at risk.

The benchmark is not a one-off academic study. To facilitate the collection of data, and to monitor trends, inform policy, and translate knowledge into action within the financial sector, the intention is for the benchmark to be a yearly analysis, with the aim of empowering others to draw lessons and inspiration from the sector’s frontrunners.

Water Sustainability Benchmarks for Financial Institutions can be applied at national or regional levels to show the extent to which investment and lending decisions contribute to the depletion or pollution of water resources, or to incentivise the protection of these resources on a specific geo-political scale. 

Water Footprint Implementation can develop and carry out water sustainability benchmarks for all sectors upon request and subject to availability of relevant data.