BEYOND VOLUMES: Exploring the Societal Value of Corporate Water Stewardship Projects

In response to emerging water challenges, a growing number of companies are engaging in corporate water stewardship and working with others to achieve more sustainable water management. Many of these companies use volumetric water benefit accounting (VWBA) to estimate volumetric water benefits (VWBs) and identify, select, and monitor projects. However, experience on the ground has shown that the same VWB in different locations delivers very different societal value.

The ‘Beyond Volumes’ report aims to show the link between VWBs and societal value, and to explore the feasibility of using existing methods to quantify and value the societal impact of water stewardship projects. The ultimate goal is to improve decision-making and strengthen water stewardship strategies and outcomes.

To achieve this outcome, Bluerisk, the Bonneville Environmental Foundation, and Valuing Impact worked with The Coca-Cola Company, Danone S.A., Ecolab Inc., and Nestlé Waters to estimate the societal value of 22 different water stewardship projects across nine project categories in 11 different countries. The estimate used social return
on investment (SROI) methods coupled with the frameworks from the Natural Capital Protocol and the Social & Human Capital Protocol.

The results showed that it is possible to measure societal value along a wide variety of impact dimensions. All 22 projects delivered positive societal value, with a combined positive societal impact of $39 million in U.S. dollars (US$) a year. The VWB measure was found to be a good indicator that positive societal value is delivered, although the measure is not correlated with the magnitude of the effect. The magnitude of the effect is most likely influenced by other dimensions, such as the local context, stakeholder preferences, project design criteria, and so on. The valuation of societal impact is thus an important indicator to measure, a complement to the VWB that informs decision-making and strategy.

The SROI ratio, which measures the total societal value generated per dollar invested in a project, was used to normalize and compare results across geographies and project categories. An alternative indicator used to normalize results is the value per drop—that is, the societal value divided by the VWB, measured in dollars per cubic meter (US$ / m3). The average SROI across projects was found to be 3.95 (that is, for every dollar invested, 3.95 dollars were delivered in terms of societal value), and the average value per drop was found to be 0.19 US$ / m.

Analyzing the SROI and value per drop indicators more closely showed an important variation in results across the portfolio of project. The projects’ contributions in terms of impact drivers were also very variable (e.g., well-being, income generation, education and skills, ecosystem services), revealing the opportunity to optimize projects’ societal value per unit of cost or unit of VWB across impact drivers. A correlation between societal and business value was also analyzed and found to be inconclusive. Some projects did deliver both societal and business value, highlighting an important opportunity to scale up water stewardship strategies.

These and other findings indicate that estimating the SROI may significantly improve decision-making by offering insights into how projects can be identified, designed, and implemented to optimize for societal value. However, these findings need to be taken in the context of the limited scope of this project, which analyzed a relatively small
number of water stewardship projects together with a preliminary impact framework and method. In short, more research will be needed to strengthen and expand the findings of this paper.

To scale up the magnitude and impact of corporate water stewardship investment, it will be essential to build on the current processes used to identify, vet, and select projects, and to improve and expand the metrics used to measure and report progress by going beyond volumes toward consistent, comparable, and relevant societal value metrics.

Moving forward, the report’s project team seeks to:

Advance the development of standardized methods for understanding and valuing the societal impact of water stewardship projects;
Strengthen and expand the results presented here by covering more projects; and
Improve the current impact framework to facilitate selection and support of projects that expand societal benefit alongside water resilience.

About the Report:

Funding for the work, and some of the information used in the report, came from The Coca-Cola Company, Danone S.A., Ecolab Inc., and Nestlé Waters. Catalina Araya, Ana Márquez, Madhu Rajesh, and Jon Radtke from The Coca-Cola Company, Jehanne Fabre from Danone S.A., Emilio Tenuta from Ecolab Inc., and Mickaël Clément and Cédric Egger from Nestlé Waters provided constructive advice on substance and structure. Global Water Challenge provided a useful review of the paper and its findings, thanks to Monica Ellis and Malick Keita. The paper was edited by Mary Cadette and designed by Lucía Menéndez De la Riva.