Consumption dips 16% in FY23: Firms becoming responsible users of water

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With responsiveness to nature and natural resources increasingly featuring on governance matrix and debuting on investor preferences, companies are trying to promote responsible consumption of these resources. Business responsibility and sustainability reporting (BRSR) data from Prime Database show that the top 1,062 listed companies consumed 16% less water in 2022-23 compared to the figure in 2021-22, The Economic Times reported. These companies used a total volume of 4.2 billion kilolitres in the last financial year.

The five companies that consumed most water in 2022-23 were NTPC, Vedanta, Tata Steel, Reliance Industries and IOC. Their usage figures stood at NTPC 114 crore kilolitres, Vedanta 26 crore kilolitres, Tata Steel and RIL 20 crore kilolitres and IOC 15 crore kilolitres.

While Vedanta used 6% less water in 2022-23 compared to 2021-22, RIL and IOC achieved a reduction of 0.9% and 3% respectively.

A company’s water consumption is defined as the total water used by the firm that is not released back into the environment. Therefore, it is not available to the ecosystem anymore. The consumption figure includes water stored during the reporting period for use or discharge in the subsequent reporting period. It is calculated by subtracting the amount of water discharged into the ecosystem from the total water withdrawn from the ecosystem by the company.

A consciousness of prudent usage seems to be kicking in with total water withdrawn (for all types of use) by all companies declining about 7% from 15.5 billion kilolitres to 14.4 billion kilolitres between the two years.

Data also suggest that companies have heavily drawn on water – comprising about 60% — from the surface sources such as rivers, lakes, ponds and streams. In fact, the procurement of water from this category of sources rose by about 4% in 2022-23 compared to that in 2021-22.

The source from where companies drew as much as 64% less water (in these two years) is ground water – from 1.3 billion kilolitre it has gone down to 0.5 billion kilolitre.

Water used from civic bodies/munipalities and other private sector suppliers has risen by 18%. Water drawn from the seas have also gone up by about 10% in 2022-23 compared to a year earlier.

Significant as the data may appear, there are words to caution from experts too. “While most companies would like to correctly assess their water usage, they often do not have any proper system to track this. Besides, there are no legal implications right now for falsification of the data being disclosed,” Nagaraj Krishnan, MD, Aparajitha Corporate Services, a tech firm providing compliance solutions to over 2000 companies in India told the newspaper.

“There is around 30-40% increase in awareness among the companies about the measures to be taken for water efficiency and reduction in usage through eliminating wastage and plugging leakages,” said Anu Chaudhary, global head of ESG Consulting, Uniqus Consultech.

The report also stated that only 12% of the 1,062 companies have undertaken independent studies about their water consumption and withdrawal from various sources.