{"id":25394,"date":"2017-11-15T19:49:32","date_gmt":"2017-11-16T00:49:32","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/unilever-the-problem-of-water\/"},"modified":"2017-11-15T19:49:32","modified_gmt":"2017-11-16T00:49:32","slug":"unilever-the-problem-of-water","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/unilever-the-problem-of-water\/","title":{"rendered":"Unilever: The Problem of Water"},"content":{"rendered":"

We experience climate change primarily through water[1]<\/a>. It affects both our supply and demand of water. On the supply side, we suffer from the unpredictable quantity and declining quality of freshwater. Receding glaciers or longer dry periods affect seasonal water flows and reduce the amount of water flowing through rivers, cutting off drinking water and water for industrial use. Rising surface temperatures can cause toxic bacteria in water to proliferate, reducing the quality of the water. On the demand side, farmers may demand more water for irrigation due to rising temperatures.[2]<\/a><\/p>\n

By 2025, two-thirds of the world\u2019s population will not be able to access as much water as they need[3]<\/a>. The Water Resources Group projects that the global demand for freshwater will exceed supply by 40% in 2030[4]<\/a>, if business and consumers carry on with today\u2019s consumption practices.<\/p>\n

 <\/p>\n

The Unilever Sustainable Living Plan<\/strong><\/p>\n

Unilever is one of the world\u2019s largest Consumer Packaged Goods companies, with businesses in Personal Care, Household, Foods and Refreshments (beverages and ice cream). With worldwide reach in all countries but six, and a supply chain touching 7,600 suppliers[5]<\/a>, its businesses have a huge global footprint.<\/p>\n

In 2010, Unilever\u2019s chief executive, Paul Polman, declared that Unilever would double the size of the business while halving its environmental footprint by 2020[6]<\/a>. One of the key metrics Unilever tracks as part of the Unilever Sustainable Living Program is water use, which they aim to halve by 2020[7]<\/a>. While the business has not yet doubled (EUR 52.7bn TO in 2016[8]<\/a>, against EUR 40bn in 2009[9]<\/a>), the company has made some progress in reducing water use. Unilever directly or indirectly uses water at four different points in their value chain.<\/p>\n

\"\"<\/a><\/p>\n

As of 2016, their water impact through consumer use has decreased by 7% since 2010[10]<\/a>. The launch of Comfort One-Rinse laundry detergent in India in 2012[11]<\/a> remains one of the strongest product-based initiatives in developing markets. In developing markets, 40% of household water used is used in washing clothes[12]<\/a>. With Comfort One-Rinse, consumers only need one bucket of water instead of three to rinse out the detergent[13]<\/a>. As Unilever launches the product in new regions at a measured pace, more needs to be done to accelerate the reduction of consumers\u2019 water consumption in the short-to-medium term.<\/p>\n

Unilever has been working with suppliers to reduce water consumption through promoting drip irrigation. This method involves supplying water to crops through tubes in small quantities, reducing surface runoff and water waste, and promises to reduce water use by 50%[14]<\/a>. Conversion will take time given the costs and process changes involved, and we will likely only see improvements in the medium-to-long term.<\/p>\n

Unilever seems to have made the most palpable reduction in water extraction in their manufacturing operations, likely due to the level of control they have over their own processes. They have used 18.7mn fewer cubic meters of water compared to 2008 levels, representing a 37% reduction[15]<\/a>. They expect 2020 levels of use to be below 2008 levels, despite an increase in production volume[16]<\/a>. Although we are unclear of the impact of this on water use in their entire value chain, this is still a commendable improvement and reinforces their commitment to saving water despite not hitting consumer targets.<\/p>\n

 <\/p>\n

Recommendations<\/strong><\/p>\n

The biggest gaps Unilever is facing are reducing the bulk of water used by consumers and suppliers. Unilever can further drive this agenda through:<\/p>\n

    \n
  1. Developing more product innovations to reduce water usage<\/li>\n
  2. Speeding up changes to suppliers\u2019 processes to reduce water consumption<\/li>\n<\/ol>\n

    More studies should be conducted to identify other areas in which consumers use a disproportionate amount of water, e.g. while bathing or cooking. A low-hanging fruit for Unilever is to extend the use of One-Rinse technology to shower products, in the hope that consumers will take shorter showers and hence, use less water. All water-saving products should be accompanied by clear usage instructions so consumers know they don\u2019t have to spend as much time rinsing themselves as before.<\/p>\n

    Agriculture is still the world\u2019s largest withdrawer of freshwater and contributor to wastewater, consuming 38% and contributing 32% in the form of waste[17]<\/a>. While we wait for drip irrigation to slowly pervade supplier practices, perhaps there is a way for Unilever to encourage suppliers to collect excess runoff water and channel it back into the current irrigation system. Unilever could speed up the process by setting targets for suppliers to meet in terms of water savings, and incentivize them by recognizing them as \u201cpreferred suppliers\u201d or through monetary awards.<\/p>\n

    Eliciting behavior and system changes in consumers and suppliers takes years, and perhaps this is why Unilever is still far from its target. Is education enough to get consumers to change their water consumption? How can we get suppliers to convert their practices quickly?<\/p>\n

     <\/p>\n

    Word Count: 796<\/p>\n

    [1]<\/a> UN Water, \u201cClimate Change Adaptation: The Pivotal Role of Water,\u201d http:\/\/www.unwater.org\/publications\/climate-change-adaptation-pivotal-role-water\/<\/a>, p. 5, accessed Nov 2017.<\/p>\n

    [2]<\/a> Ibid.<\/p>\n

    [3]<\/a> UN Water, \u201cWater and Climate Change,\u201d http:\/\/www.unwater.org\/water-facts\/climate-change<\/a>, accessed Nov 2017.<\/p>\n

    [4]<\/a> The Water Resources Group, \u201cBriefing report prepared for the World Economic Forum Annual Meeting\u201d (2012), http:\/\/www3.weforum.org\/docs\/WEF\/WRG_Background_Impact_and_Way_Forward.pdf<\/a>, p. 17, accessed Nov 2017.<\/p>\n

    [5]<\/a> Vivienne Walt, \u201cUnilever CEO Paul Polman\u2019s Plan to Save the World,\u201d Fortune.com, February 17, 2017, http:\/\/fortune.com\/2017\/02\/17\/unilever-paul-polman-responsibility-growth\/<\/a>, accessed Nov 2017.<\/p>\n

    [6]<\/a> Unilever, \u201cAbout our Strategy,\u201d https:\/\/www.unilever.com\/sustainable-living\/our-strategy\/about-our-strategy\/<\/a>, accessed Nov 2017.<\/p>\n

    [7]<\/a> Unilever, 2016 Annual Report, p. 13, https:\/\/www.unilever.com\/Images\/unilever-annual-report-and-accounts-2016_tcm244-498880_en.pdf<\/a>, accessed Nov 2017.<\/p>\n

    [8]<\/a> Ibid.<\/p>\n

    [9]<\/a> Unilever, 2010 Annual Report, p. 23, https:\/\/www.unilever.com\/Images\/unilever-ar10_tcm244-421849_en.pdf<\/a>, accessed Nov 2017.<\/p>\n

    [10]<\/a> Ibid.<\/p>\n

    [11]<\/a> Unilever, \u201cHelping consumers save water,\u201d https:\/\/www.unilever.com\/sustainable-living\/reducing-environmental-impact\/water-use\/helping-consumers-save-water\/#244-423666<\/a>, accessed Nov 2017.<\/p>\n

    [12]<\/a> Ibid.<\/p>\n

    [13]<\/a> Ibid.<\/p>\n

    [14]<\/a> Unilever, \u201cWorking with suppliers & farmers to manage water use,\u201d https:\/\/www.unilever.com\/sustainable-living\/reducing-environmental-impact\/water-use\/working-with-our-suppliers-and-farmers-to-manage-water-use\/#244-423668<\/a>, accessed Nov 2017.<\/p>\n

    [15]<\/a> Unilever, \u201cReduce water abstracted by manufacturing sites,\u201d https:\/\/www.unilever.com\/sustainable-living\/reducing-environmental-impact\/water-use\/#244-503774<\/a>, accessed Nov 2017.<\/p>\n

    [16]<\/a> Ibid.<\/p>\n

    [17]<\/a> UNESCO, \u201cWastewater, The Untapped Resource\u201d (2017), http:\/\/unesdoc.unesco.org\/images\/0024\/002471\/247153e.pdf<\/a>, p. 9, accessed Nov 2017.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Water is the elixir of life. 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