Water is one of the critical factors of ESG (Environment, Social, and Governance). Fresh and clean water is increasingly endangered despite being considered a plentiful renewable resource mainly due to population growth and economic activity leading to an increase in water demands and pollution.
According to United Nations, if current consumption and production patterns do not change, there will be a 40% shortfall in water supply by 2030. Companies are expected to face increased scrutiny such as limits on water withdrawal and tight regulations over their water use as global water resources face increased stress.
In terms of water withdrawal, the beverage and bottled mineral water sectors need to be careful because groundwater is a raw material for them. Globally, food and beverage companies face disputes with local communities over the amount of groundwater that can be withdrawn without depleting local resources.
The Coca-Cola Co (Coca-Cola) is a US-based producer, distributor, and marketer of non-alcoholic beverages. It markets beverages under the brand names Sprite, Coca-Cola Zero, Diet Coke, Fanta, Powerade, Dasani, FUZE TEA, Minute Maid, Simply, Georgia, and Del Valle. It has a market capitalization of $236 billion as of October 2022. In 2021, Coca-Cola withdrew 298 million cubic meters of water, an increase of 6% over 2020. The beverage company aims to maintain at least 100% global replenishment of the water used in its finished beverages.
PepsiCo Inc (PepsiCo) is a US-based manufacturer and marketer of non-alcoholic beverages and food products. It markets these products under various brands, including Pepsi, Pepsi Max, Mountain Dew, Lay's, Frito-Lay, Gatorade, Quaker, and Yachak. It has a market capitalization of $224 billion as of October 2022. In 2021, PepsiCo withdrew 85.94 million cubic meters of water, an increase of around 3.9% over 2020. The company aims to become Net Water Positive by 2030.
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