The AWS Standard: What World-Class Water Stewardship Looks Like
The Alliance for Water Stewardship International Water Stewardship Standard (AWS Standard Version 2.0, published 2019) is the globally recognized framework for site-level water stewardship practice and third-party certification. The AWS Standard is built around six core criteria organized in a Plan-Do-Check-Act structure: Governance (leadership commitment, water stewardship policy, organizational responsibility); Understanding of Site and Catchment Context (site water accounting, understanding of catchment-level water challenges affecting and affected by site operations); Site Water Management (water efficiency programs, discharge quality management, site-level risk reduction); Meaningful and Measurable Outcomes (demonstrable improvement in water efficiency, discharge quality, and catchment water health indicators); Collective Action (engaging with other water users, communities, and government in the shared catchment to address systemic water challenges beyond what individual sites can solve alone); and Transparency and Disclosure (public reporting on water stewardship performance and progress against targets).
AWS certification operates at three levels: Core, Gold, and Platinum — reflecting increasing stringency of requirements and performance targets. Core certification confirms a site has completed a water stewardship assessment, developed a water management plan, and begun implementation. Gold certification requires demonstrated performance improvements and collective action engagement. Platinum — the highest level — requires verified leadership performance outcomes and significant contributions to catchment-level water health. Companies with AWS-certified sites include AB InBev, Diageo, Levi Strauss, PepsiCo, and Olam International — predominantly in water-intensive sectors like food and beverage, apparel, and agriculture.
CDP Water Security Disclosure: The Investor-Facing Standard
CDP’s annual Water Security questionnaire — completed by approximately 4,000 companies representing $19 trillion in market capitalization — is the primary investor-facing water disclosure mechanism. CDP asks companies to report water withdrawal and consumption by source and quality, water stress exposure across facilities, business risk quantification, water stewardship targets, and governance of water issues. CDP scores (A through D-) are used by institutional investors, procurement departments, and banks as a proxy for corporate water management maturity. Companies with CDP Water A-list scores demonstrably manage water risk more effectively than lower-scoring peers, and are increasingly rewarded with lower cost of capital and supply chain preference.
Practical Corporate Water Stewardship: From Strategy to Action
Effective corporate water stewardship begins with understanding your water risk profile at the site level using WRI Aqueduct, WWF Water Risk Filter, or the CEO Water Mandate’s Water Risk Monetizer. Sites in high water stress areas — identified as facing greater than 40% of available water being withdrawn annually — require priority attention and more ambitious water management targets. Set science-based water targets aligned with the Science Based Targets Network (SBTN) freshwater guidance: site-level targets that reflect the specific water availability and stress conditions of the local basin, rather than generic company-wide efficiency targets. Engage other basin users — agricultural irrigators, municipalities, industrial peers — through collective action initiatives like basin roundtables, watershed improvement programs, and regional water stewardship platforms funded by multiple water users.
Water is the next frontier of corporate sustainability risk. While climate change has dominated ESG agendas for two decades, water stress, scarcity, quality degradation, and ecosystem disruption are emerging as equally material — and in some regions, more immediately urgent — threats to business continuity, supply chain stability, and social license to operate. The World Economic Forum has ranked water crises among the top five global risks by impact for ten consecutive years. For companies operating in water-stressed regions — or whose supply chains do — corporate water stewardship has moved from voluntary best practice to strategic imperative. The Alliance for Water Stewardship (AWS) International Water Stewardship Standard provides the globally recognized framework for credible, site-level corporate water stewardship practice and certification.
Understanding Corporate Water Risk: The Three Dimensions
Corporate water risk operates across three interconnected dimensions. Physical water risk encompasses quantity risks (water scarcity, drought, and competition for shared water resources) and quality risks (contamination of water sources, regulatory limits on water discharge, and declining source water quality affecting treatment costs). The World Resources Institute’s Aqueduct Water Risk Atlas maps physical water risk at basin level globally — a critical tool for identifying which facilities and supply chains face near-term physical risk. Approximately 1 in 4 people live in areas of extremely high water stress, and this share is growing with climate change and population growth.
Regulatory water risk includes the risk that water use permits are revoked or curtailed during drought conditions, discharge permits become more stringent (requiring costly treatment upgrades), or new regulations impose water-use fees, metering requirements, or efficiency mandates. In the U.S. West, where prior appropriation water law (“first in time, first in right”) governs water allocation, junior water rights holders face complete curtailment before senior rights holders during drought — a systemic business risk for agriculture, mining, semiconductor manufacturing, and data centers in western watersheds. The Colorado River Basin’s ongoing over-allocation crisis — where seven U.S. states and Mexico have more water rights than the river produces in drought years — is the most consequential water rights conflict in American business history.
Reputational water risk arises when community opposition, NGO campaigns, or media coverage target companies for perceived water overuse, contamination, or impact on community water access. High-profile controversies — Nestlé’s bottled water sourcing in drought-stricken regions, mining companies’ tailings pond failures contaminating river systems, semiconductor fabs consuming millions of gallons daily in water-stressed Arizona — demonstrate that social license to operate in water-scarce regions is contingent on genuine stewardship, not just legal compliance.
The AWS Standard: What World-Class Water Stewardship Looks Like
The Alliance for Water Stewardship International Water Stewardship Standard (AWS Standard Version 2.0, published 2019) is the globally recognized framework for site-level water stewardship practice and third-party certification. The AWS Standard is built around six core criteria organized in a Plan-Do-Check-Act structure: Governance (leadership commitment, water stewardship policy, organizational responsibility); Understanding of Site and Catchment Context (site water accounting, understanding of catchment-level water challenges affecting and affected by site operations); Site Water Management (water efficiency programs, discharge quality management, site-level risk reduction); Meaningful and Measurable Outcomes (demonstrable improvement in water efficiency, discharge quality, and catchment water health indicators); Collective Action (engaging with other water users, communities, and government in the shared catchment to address systemic water challenges beyond what individual sites can solve alone); and Transparency and Disclosure (public reporting on water stewardship performance and progress against targets).
AWS certification operates at three levels: Core, Gold, and Platinum — reflecting increasing stringency of requirements and performance targets. Core certification confirms a site has completed a water stewardship assessment, developed a water management plan, and begun implementation. Gold certification requires demonstrated performance improvements and collective action engagement. Platinum — the highest level — requires verified leadership performance outcomes and significant contributions to catchment-level water health. Companies with AWS-certified sites include AB InBev, Diageo, Levi Strauss, PepsiCo, and Olam International — predominantly in water-intensive sectors like food and beverage, apparel, and agriculture.
CDP Water Security Disclosure: The Investor-Facing Standard
CDP’s annual Water Security questionnaire — completed by approximately 4,000 companies representing $19 trillion in market capitalization — is the primary investor-facing water disclosure mechanism. CDP asks companies to report water withdrawal and consumption by source and quality, water stress exposure across facilities, business risk quantification, water stewardship targets, and governance of water issues. CDP scores (A through D-) are used by institutional investors, procurement departments, and banks as a proxy for corporate water management maturity. Companies with CDP Water A-list scores demonstrably manage water risk more effectively than lower-scoring peers, and are increasingly rewarded with lower cost of capital and supply chain preference.
Practical Corporate Water Stewardship: From Strategy to Action
Effective corporate water stewardship begins with understanding your water risk profile at the site level using WRI Aqueduct, WWF Water Risk Filter, or the CEO Water Mandate’s Water Risk Monetizer. Sites in high water stress areas — identified as facing greater than 40% of available water being withdrawn annually — require priority attention and more ambitious water management targets. Set science-based water targets aligned with the Science Based Targets Network (SBTN) freshwater guidance: site-level targets that reflect the specific water availability and stress conditions of the local basin, rather than generic company-wide efficiency targets. Engage other basin users — agricultural irrigators, municipalities, industrial peers — through collective action initiatives like basin roundtables, watershed improvement programs, and regional water stewardship platforms funded by multiple water users.
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