Davos, Switzerland – 25 Jan 2018
This article is part of the World Economic Forum Annual Meeting and is written by Elsa Galarza Contreras, Minister of Environment, Ministry of Environment of Peru and Jane Nelson, Director, Corporate Responsibility Initiative, Harvard Kennedy School
Water insecurity poses one of the greatest risks and leadership challenges of our generation. It threatens the well-being and livelihoods of millions of people. It has started to undermine food, energy and industrial production and damage economic growth prospects in many countries. It raises the spectre of failing systems, large-scale involuntary migration, political instability and conflict.
Demand for water is expected to exceed supply by 40% by 2030. New technologies, financing mechanisms, delivery models, voluntary standards and policy and regulatory innovations will be required to address this growing gap. Governments must take the lead in enabling these activities and making tough choices to allocate water resources among different uses and users. To be effective, however, they will need to consult and cooperate more strategically with stakeholders in business and civil society.
In the absence of such collaboration, it will be impossible to achieve the type of technical, behavioral and political changes that are needed to improve water governance at global and national levels, as well as in water management and local use. The 2030 Water Resources Group (2030 WRG) demonstrates what is possible.
The 2030 WRG was established in 2008 as an informal consortium of some of the World Economic Forum’s members, including the IFC, McKinsey & Company, the Barilla Group, The Coca-Cola Company, Nestlé, New Holland Agriculture, SABMiller, Standard Chartered Bank and Syngenta. Today, it has evolved into a multidimensional, public-private partnership with country-led implementation platforms at its core. Hosted by the World Bank Group, its mission is “to help countries achieve water security by 2030 by facilitating collective action between government, the private sector and civil society”.
Through multistakeholder platforms in 14 countries and states, some 600 organizations from different sectors are working together on projects and policy reforms with support from the 2030 WRG team. They range from operational projects, such as agricultural, industrial and municipal water use efficiency, to strategic initiatives, such as urban-industrial security and river basin governance.
The collaborative approach has helped to build trusted relationships between different sectors as well as across silos within government and industry. In Peru, for example, five ministers serve on the country’s WRG steering board. The highest levels of government have made commitments in Bangladesh, Karnataka and Maharashtra. In South Africa and Mongolia, agricultural, mining and manufacturing companies are cooperating individually and through industry associations. Efforts are underway to increase engagement with civil society organizations, farmers and citizens.
The evolution of the 2030 WRG has not been without setbacks and challenges. Some initiatives have been disbanded and others adapted in response to changes in leadership, external evaluations and shared experimentation and learning. As 2030 WRG approaches its 10th anniversary, the model reflects five early lessons for leaders working on water security and other complex, systemic challenges:
- Government in the lead: The multistakeholder approach offers an alternative to what has primarily been a public sector role when ultimate responsibility still rests with government. A core priority of the approach is to help address the capacity gaps and overcome the political constraints that many governments face in managing water resources effectively and transparently.
- Local ownership and collaboration from business and civil society: Greater inclusion and decision-making by local business and civic leaders have been essential in identifying shared priorities, designing feasible solutions and creating the incentives and buy-in needed for implementation.
- A combined focus on data and analysis, stakeholder dynamics and the political economy of change: The 2030 WRG has learned the importance of balancing rigorous data and a technical understanding of water challenges with an appreciation of the institutional and political context. In addition to highlighting water security as a potential constraint on economic growth, it considers social and environmental concerns to generate a sense of shared urgency among diverse stakeholder interests.
- Strong ‘backbone support’: A challenge of many multistakeholder platforms is that they unite parties who are at best unfamiliar and at worst distrustful of each other. Backbone support from a team that has the ability to stimulate, coordinate and support collaboration among such parties is essential. It requires a combination of technical expertise alongside the ability to think long-term, live with uncertainty, and learn and adapt along the way.
- Vital roles for individual champions: Individual leaders have been essential to the evolution of the 2030 WRG. They have ranged from government ministers to corporate CEOs and practitioners from the participating organizations. Many have taken real, personal risk, investing their time, effort, influence, networks and, in some cases, reputation as vocal supporters for a collective effort they do not control and the outcomes of which are uncertain.
The 2030 WRG offers a promising approach to tackling the complex, systemic challenges of achieving water security and resolving shortages in the world’s most essential resource. If it can demonstrate the effectiveness of systems leadership and collaboration in the water sector, there will be enormous potential for this kind of approach to have a broader role in expediting progress towards achieving the Sustainable Development Goals.
This draws on the findings of a report on the 2030 Water Resources Group published by the Corporate Responsibility Initiative at Harvard Kennedy School.
Bengaluru, December 13, 2017: The Government of Karnataka (GoK) today signed Memoranda of Understanding (MOU) with seven private sector companies for procuring high-value agricultural and horticultural produce, and building farmer capacity on best practices in the Ramthal project area. This engagement is a part of the Drip-to-Market Agro Corridor (DMAC), a large-scale initiative on connecting drip irrigated areas with market linkages, conceptualized by the Government of Karnataka in partnership with 2030 Water Resources Group (2030WRG). With representation from GoK’s Departments of Water Resources, Agriculture, Horticulture, Watershed Development, as well as private sector, the MOU signing workshop focused on fostering an alliance of private sector partners in this pioneering initiative.
The workshop follows from an initial wave of six MOUs signed with private sector in July 2017. Structured as four-way MoUs among private sector companies and the GoK’s Departments of Water Resources, Agriculture and Horticulture, the strong response from private sector endorses the project’s benefits in providing companies a stable environment to establish a sustainable supply chain for high-value crops, with assured water supply and efficiency in water use.
Johannesburg, October 12 2017 – Leading water, infrastructure and financial sector stakeholders met in Johannesburg for in-depth talks on funding models to improve South Africa’s water security. The third Annual Water Stewardship summit, kicked off with calls for the financial sector to look introspectively at ways to support efforts to close the water services infrastructure funding gap amounting to around US$ 2.3 billion per annum; in support of the coming National Water and Sanitation Master Plan.
The South Africa Department of Water and Sanitation is currently in the process of drafting the country’s new National Water and Sanitation Master Plan, with expected completion in March 2018. The summit, organized by the Strategic Water Partners Network, the National Business Initiative and the Royal Danish Embassy, provided an often-neglected opportunity for public and private financiers to become involved in the initial planning and project conceptualization stage of the new National Water and Sanitation Master Plan. By involving such financiers early in the process, it is hoped that the master plan’s investment strategy would be designed in a way which is as beneficial to the country as it is attractive to investment.
Outlining the goals of the plan, Trevor Balzer, Deputy Director General: Strategic and Emergency projects at the Department of Water Sanitation, echoed sentiments made earlier this year by his Deputy Minister, Pamela Tshwete, who, at the first dialogue on the Water and Sanitation Master Plan on 19 May this year, called upon big businesses to assist in funding sustainable development projects. Balzer said: “Today’s event has brought us together at a critical time in South Africa’s water and sanitation planning. We expect to incorporate the feedback we received today from the financial community and other stakeholders to create a plan that effectively addresses the country’s needs.”
Catherine-Candice Koffman, Head of Infrastructure and Telecommunications Project Finance within Corporate and Investment Banking (CIB) one of the “big four” banks in South Africa – Nedbank, stated, “Getting involved at this stage of the planning process helps us from a corporate and investment banking perspective to better conceptualise how we can leverage our strategic, operational and sustainability goals to proceed in a way which will contribute to the future master plan. At Nedbank CIB we understand the intimate connectivity between leveraging natural resources and converting these into viable economic solutions to ensure the sustainability of our business and the socio-economic ecosystem in which we co-exist.”
One key recommendation, among a few others, for the Master Plan was that because Non-Revenue Water losses amount to about US$ 500 million annually, this was an area to consider a central government led programme that could make use of public and private investment to reduce municipal water and revenue losses. The SWPN is already testing some concepts of how this could be done.
Since the beginning of 2017, the three large working groups that had been in operation evolved into six working committees that were more limited to the needs, problems and opportunities that were identified in the spaces for dialogue. The new committees today address the following issues:
1. Water Works for Taxes
2. Groundwater management
3. Hydrically Responsible Companies- The Blue Certificate
4. Water governance and dialogue processes
5. Promotion of public policies around water
6. Water stress and adaptation to climate change
The advantage of these committees with a total participation of more than 100 members, is that they are focused on finding concrete solutions with specific tasks for the different stakeholders. For example, the Water Works for Taxes mechanism is being implemented and the private sector participates and invests directly in works of the State to improve sanitation services, to expand potable water services and improve drinking water treatment plants, among others. Another group enables methodologies for the definition of tariff groundwater use, one focuses on the promotion of the water footprint through the certification of companies, among others. The 2030 WRG ACT methodology has allowed, step by step, to build robust and sustainable programs and policies for the sustainable water management in Peru.
October 4, 2017 – The Ministry of Water and Irrigation in collaboration with the 2030 Water Resource Group Tanzania Partnership held a two-day multi-sectoral forum on 4 and 5 October to discuss Tanzania’s water management issues. The forum participants included representatives from the private sector, government and civil society organizations.
Professor Kitila Mkumbo, Permanent Secretary in the Ministry of Water and Irrigation, said in his opening remarks at the event: “People need to know that Tanzania is one of the countries said to have abundant water resources but are subject to competing demands. The use of such forums will help to get an agreed agenda to address competitions and thereby support sustainable growth. The country is endowed with relatively abundant freshwater sources, including rivers, springs, lakes, wetlands, and aquifers. However, these resources are unevenly distributed in time and space.”
The Director of Water Resources in the Ministry of Water and Irrigation, Mr. Hamza Sadiki said: “the average volume of renewable freshwater per capita per year has been declining, from 2,300 m cubic in 2002 to 1,952 m cubic in 2015. This figure is projected to further decline to 1,500 m cubic by 2025.” Mr Sadiki further warned that if water resources are not managed well, it will put the country within the water-stressed category, below 1,700 m cubic per capita, and business as usual will further put Tanzania in the water–scarce category.”
January 2018 will mark a new phase for 2030 WRG as the program moves from IFC to the World Bank Water Global Practice (Water GP). The strategic decision has been made by the 2030 WRG Governing Council to accommodate opportunities for larger scale impact as the program is set to expand its operations. 2030 WRG Steering Board Co-Chairs Dominic Waughray and Jyoti Shukla shared some thoughts on this development.
“2030 WRG challenges how stakeholders across all sectors engage and collaborate in the water space,” Dominic said. “It is a positive innovation that brings together the public and private sectors as well as civil society organizations (CSOs).”
Jyoti added: “The Water GP is very excited about this transition. We will be looking at approaches for each program and intervention to develop sustainably at scale. Both an opportunity and a challenge, we will build upon the wonderful work that has been done in the past 6 years, during which the program was given the opportunity to mature and grow at IFC, after its initial incubation period at the World Economic Forum.”
Vision and Leadership
Dominic and Jyoti both acknowledged the 2030 WRG partners and thanked them for their vision, commitment, and leadership to embark on this innovative collaboration back when it was merely an idea. It has not been a journey void of challenges as the program engaged partners who would not normally have been at the same table constructively debating water issues and co-designing public-private solutions. “The result is the tremendous impact we are already making in the countries and the potential it has to grow at a global scale. With the transition to the Water GP and its extended network there is an opportunity to scale impact in existing country partnerships and reach out to many more countries and stakeholders,” Dominic added.
Jyoti elaborated: “Typically, the Water GP engages in global and regional partnerships with governments, CSOs and other related development partners. 2030 WRG adds tremendous value to the Practice as there is now an opportunity to bring in more private sector partners to the mix. The World Bank’s main instruments include lending support through IBRD and IDA, policy dialogue and providing technical assistance to governments on legal and regulatory frameworks. We are now creating the capacity to mobilize the expertise of the private sector, including commercial financing approaches that reach the poor and are environmentally and socially inclusive and sustainable. The transition now to the Water GP is an important next step for 2030 WRG. It will be a natural development to find synergies and collaboration with the largest concentration of the world’s water experts that work within the Water GP.”
The World Bank’s water portfolio currently covers 175 projects worth US$27 billion in lending and technical expertise. Around 70% of lending is for services such as water supply and sanitation and irrigation projects. Since 2014, lending for water resources management has also shown rapid growth, rising to 30% of the portfolio in 2017. In addition, projects with a water sector-related component managed by other World Bank global practices total approximately $10 billion, meaning the Bank’s total water-related investments are $37 billion.
“Country-level success has been demonstrated in many of our MSPs,” Dominic said. “Part of 2030 WRG’s impact and success is its ability to break through silos – when an important platform on water in a country is co-hosted by a minister and a private sector representative who is knowledgeable on the topic. When on that same platform civil society partners, academics, and a range of other actors are welcomed to openly discuss plans to grow the economy within the constraints that water has to offer. In Peru, South Africa, and Mongolia to name a few interventions, practical plans have emerged from those platforms. This model has emerged as a reliable and effective approach to integrate business with sustainable water resources management and can be replicated now in other countries.”
Jyoti concurred and added: “As water is increasingly becoming a scarce, economic and political commodity it is extremely important for all stakeholders to come together to discuss alternative uses of water, contribute to water policy and water resource management interventions. This balances out competing demands more successfully. When there is a common understanding and a willingness to understand each other’s perspectives, this will translate into policies and interventions that may change the way water resources are managed on the ground.”
Dominic suggested the role of technology as one potential avenue to continue innovating within the MSPs, particularly when it comes to measuring and scaling impact “Perhaps we can draw in more ideas from science and technology innovators to help countries improve their water resources management and monitoring capabilities. This will help us find additional ways to iterate and refine our engagements, while ensuring that the lessons we learning along the way are incorporated into the decision-making processes. It is heartening to see attribution of our work in the water resource space and I am eager to learn how, jointly with the Water GP, 2030 WRG can do an even better job of demonstrating its impact in the long run.”
Message for partners
Jyoti and Dominic welcomed all new partners who recognize that collaboration in the MSP domain is key to addressing water resources challenges. They also acknowledged that given the program’s ambition to scale up, new partners and sources of funding will naturally be needed to achieve 2030 WRG’s continued success and maximize impact. “New stakeholders have the opportunity to join an initiative that, several years into its delivery, is now maturing into an extended network, enriched with tremendous sector expertise” Dominic said. “To our current network of partners of high-level government officials, companies and CSOs, I would like to encourage them to reach out to their peers and share their 2030 WRG experience, including advice and guidance to those who are embarking on this 2030 WRG model of collaboration. Peer-to-peer flow of knowledge is key.” Jyoti added: “It is really time for the water sector to move away from augmenting supply to putting the efficient management of water resources at the heart of the water agenda. Achieving the SDGs will be quite a daunting challenge and it requires all parties to work together towards this common goal.
Dominic Waughray is Head of Public-Private Partnership, Member of the Executive Committee at the World Economic Forum in Geneva and Jyoti Shukla is Director of the Water Global Practice at the World Bank Group in Washington DC.
Both Dominic and Jyoti have expressed their heartfelt thanks to the Governing Council and Steering Board members for their dedication and unwavering support all these years. The program’s success and impact is reflected in their continued commitment.
In this quarterly edition of ‘Partner in the Spotlight’ we interviewed Phyllis Wakiaga, CEO of the Kenya Association of Manufacturers (KAM) about her vision on Kenya’s water management challenges, incentives for the private sector to collaborate with governments and a new industrial water policy.
KAM’s goals are to promote competitive and sustainable local manufacturing. How do you see the ongoing work jointly undertaken with 2030 WRG contributing to these goals?
“Water is becoming an increasingly paradoxical subject; mainly because it is a universal basic need without which there would be no life, and yet, it is fast becoming the foremost depleted and scarce resource in the world.
Collaboration with 2030 WRG has leveraged KAM’s work in industrial water management, particularly in the Nairobi sub catchment. It is through this collaboration with 2030 WRG, that led to the formation of the Kenya Industrial Water Alliance (KIWA) that brings industry stakeholders together to build a shared understanding of a water secure future.”
How does this work support the government’s Vision 2030 campaign’s main pillars?
“Water’s essential quality to our economy is clear, especially the aspects that drive growth such as industrialization. Economies depend either directly or indirectly on industries where the main input is water. The government is focused on industrialization as one of the vehicles to deliver Vision 2030. Therefore, we must start paying attention to the role of water as the main ingredient to a thriving and growing industry.
Industries and other businesses have realized that their individual use of water cannot be viewed in isolation as increased activity or demand in one sector alters the amount of input, in terms of water, energy or raw material, needed for another sector. Hence there is bound to be a burgeoning competition for water, which reduces the availability for other users. Through the KIWA initiative implement activities have greatly assisted industry. Manufacturers are now able to increase their sustainability to access water and manage efficiency and quality.”
With a predicted 30% gap between water supply and demand by the year 2030, what is the risk for the Kenyan economy and for its manufacturing sector if we are to conduct business as usual?
“The Manufacturing sector in Kenya is currently faced by a shortage in water supply , and is increasingly recognizing that the availability and quality of water poses a risk to their operations. KAM is supporting the manufacturers by providing subsidized water and waste water audits to identify areas of improvement at firm level while at the same time reducing their waste water flows and finding potential areas of either recycling, reusing or reducing the waste water. Promoting sustainable manufacturing will reduce the risk of increased water demand per capita, which translates to high water footprints for the manufacturing sector.”
What do you think are the main bottlenecks that Kenya needs to overcome to be able to close this gap between water demand and supply as much as possible? I.e. inefficiencies in water use.
“Kenya is one of the countries termed by the UN as ‘Chronically water scarce’. This is because we fall below the global standard benchmark for water adequacy set at 1,000 cubic meters, registering less than 647 cubic meters of water supply.
Increased populations in urban spaces bring along increased business activities, erode the natural resilience for water bodies, making them vulnerable to climate change and other environmental shocks. This diminishes presently available sources of fresh water whilst exacerbating the tension between the ever-growing demand for it and the dwindling supply. We therefore need to develop an industrial water policy to look at the provision, use, distribution, disposal and the reuse of water whilst upholding and replenishing the ecosystem.”
You advocate for an industrial water policy. Can you elaborate a bit on this initiative?
“We are advocating for an effective industrial water policy that will be the framework upon which water governance is formulated to ensure sustainability and accountability in the Country. An effective industrial water policy will be the framework upon which water governance is formulated to ensure sustainability, and will focus on solving key water challenges by integrating industrial processes towards improving water accessibility, while fostering constructive relations between Industry, Government and communities.”
What are the main incentives for the private sector to get involved in collaborating with the government on sustainable water management practices?
“Kenya’s economy suffered a setback during the severe drought that we experienced at the beginning of the year. The drought, which was declared a national disaster, caused a contraction in Agricultural activities and a deceleration in supply of electricity. It is important that we partner with government to ensure continuous supply of water for industry. Some of the major incentives that private sector can involve itself in to drive continuous supply include:
- Economic instruments
- Investment in water management technologies
- Building capacity for private sector
- Develop water use benchmarks
- Promoting adoption of best practices & water efficient fixtures for demand side management”
What do you think the role and added value is for the broader 2030 WRG and the recently established Kenya Industrial water alliance (KIWA)?
“As mentioned above, The Kenya Industrial Water Alliance (KIWA) is an example of a platform that was set-up to bring industry stakeholders together to build a shared understanding of what a ‘water secure’ future entails. KIWA includes the input of diverse stakeholders who contribute not only towards finding solutions for the current issues but to deliberate on future water management challenges that would compromise our economic and social development goals. The initiative also acts as a tool to track and monitor industry use of water and to find ways to adjust their capacity to recycle waste water. These activities have increased sustainable access to water, improved both industrial water use efficiency and surface water quality management for manufacturers.”
What is the perception among industry partners of these platforms?
“As industry, we need a well-structured policy that considers all facets of human life – that is – political, social and economic. Aside from cementing and harmonizing existing water regulations, such a policy will aim to incentivize, self-regulation and re-use of water in industry. It would be very beneficial to our country as it would present a well–articulated understanding of water governance, in order to maximize the economic and social welfare benefits that access to adequate water brings.”
As part of a global initiative of 2030 WRG, Peru also interviewed its main stakeholders to gain insights into their appreciation and perceptions about the work that 2030 WRG has been undertaking in Peru. The results are encouraging:
- Awareness: 97% consider the role of the 2030WRG to improve governance and reduce the water gap excellent or good
- Collaborative and coordinated action: 52% acknowledge that 2030WRG has contributed to the improvement in water resources management.
- Leadership and mobilization: 50% believe that the internal mobilization has been successful.
- Interaction among members: 94% acknowledge having worked with counterparts with whom they did not previously work.
- Variations in involvement on specific issues: 45% increased their participation in governance actions.
- Results and impact: 71% state that 2030 WRG is very effective and 74% recognize socio-environmental and / or socio-economic results.
As pending challenges, it was suggested to involve new actors and / or define more specific roles for some of the existing working groups, as well as to communicate the actions now that concrete results are beginning to occur.
Since 2016, 2030 WRG Peru has been working closely with the National Water Authority (ANA) to look for the best possible alternatives to ensure that companies in the private sector measure their water footprint throughout the value chain. This now means that they are aware of their own water consumption and can take actions to reduce it. That is why they have created and launched the Blue Certificate, a form of recognition that encourages companies to meaesure their water footprint and additionally to have a Shared Value strategy with the community, which makes it a sustainable program.
The certificate has been very well received in the private sector and there are already about 10 companies in the process of being certified. One company has already obtained certification in July of this year. A communication strategy with private sector companies from the 2030 WRG working groups is being implemented, and an advocacy strategy and bilateral meetings for the presentation of the Blue Certificate and its benefits has been developed since the beginning of the year. A meeting with high-level representatives from the private sector is scheduled for November to engage even more companies with this innovative approach.
Mumbai, 13 October 2017 – The Government of Maharashtra has partnered with 2030 WRG to form the State’s first Water Multi-Stakeholder Platform for transformative solutions in water resources management. The first meeting of the MSP Steering Board for was convened under the chairmanship of the Chief Secretary, Government of Maharashtra, on 7 August 2017. Emphasizing the importance of a multi-stakeholder partnership approach, Sumit Mullick (IAS), Chief Secretary, indicated that “government can only solve the serious water problems we face with the active and enthusiastic participation of the private sector and civil society.”
At the Steering Board meeting, Bombay Chamber of Commerce and Industry, Indian Merchant’s Chamber and State Level Banker’s Committee actively represented the private sector, BAIF Development Research Foundation, Watershed Organisation Trust (WOTR), Indian Water Works Association and Indian Institute of Technology (IIT, Bombay), represented civil society and academia. Experts at the Maharashtra Water Resources Regulatory Authority, Department of Agriculture, Water Conservation and Water Resources of the Government of Maharashtra attended the meeting.
Acknowledging that Maharashtra faces a high risk to climate change and agriculture sector is the highest user of freshwater in the State withdrawing more than 80% of the water available, the Steering Board agreed to formalize the Rain-fed Agriculture Work Stream (anchored by the Agriculture Department) and the Command Area Water Productivity Work Stream (anchored by Water Resources Department), and appoint its multi-stakeholder members. The MSP emphasizes the importance to aligned with current state priority initiatives such as the Chief Minister’s flagship Jalayukt Shivar (focused on Water for All – drought-free state by 2019), the World Bank supported USD$480 million Project on Climate Resilient Agriculture (POCRA), the multi-stakeholder Maharashtra Cotton Water Platform promoting greater water use efficiency in the cotton sector, and the US$270 million Green Climate Fund submission Scaling Adaptation in Maharashtra Rain-fed Agriculture (SAMRA), supporting most vulnerable village clusters adopt water conservation measures leveraging private sector/market linkages. The latter two are existing 2030 WRG initiatives launched previously in partnership with the Maharashtra Department of Agriculture and other key stakeholders.
The Steering Board’s decision to develop these Work streams was informed by the Maharashtra Hydro-Economic Analysis of Opportunities to Improve Water Use in Agriculture Sector championed by 2030 WRG in 2015. The report addressed the question of how Maharashtra can continue to grow its State GDP in the agricultural sector 4% overall and 6% in rain-fed areas, while maintaining or even reducing the overall water footprint.
Given the rapid urbanization in the state of Maharashtra and legacy of industrial development, the Steering Board also consented to the immediate launch of a third Work stream for Urban Industrial Water Security, to be anchored by the Urban Development Department.
- Government Resolution issued by the Government of Maharashtra to form the Steering Board for MSP
- Maharashtra Hydro-Economic Analysis