Water is becoming scarcer, raising a fear that so-far manageable price increases could spike. -- PHOTO: REUTERS
NEW YORK - AT NEW York's Del Posto, diners can share a US$130 (S$190) entree of wild branzino fish with roasted fennel and peperonata concentrato and a US$3,600 bottle of Dom Perignon.
They cannot share a bottle of Perrier or San Pellegrino water.
SETTING WATER CONSERVATION TARGETS
AS THEY face criticism, multinational drink companies are setting water conservation targets, building community wells and more efficient factories, working with locals on sustainable farming, water harvesting and reforestation and looking for new technologies to reduce their water consumption even as they make more drinks.
'For our type of business, or any that have a very direct link to water ... We've got to play that role,' said Mr Greg Koch, Coke's managing director of global water stewardship.
'(Water) is currently not a very big cost. The issue is where it will it go in the future,' said Mr Andy Wales, head of sustainable development for brewer SABMiller, which used 94.5 billion litres of water in its latest fiscal year. That works out to 4.5 litres for every litre of beer it made.
The Italian restaurant backed by celebrities Mario Batali and Joseph Bastianich is one of several shunning bottled water, along with the city of San Francisco and New York state.
'The argument for local water is compelling and obvious,' said Bastianich, who is phasing out bottled water across his restaurant empire, which stretches to Los Angeles.
'It's about transportation, packaging, the absurdity of moving water all over the world,' he said.
As environmental worries cut into sales from traditionally lucrative bottled water, beverage companies such as Coca-Cola, PepsiCo, Nestle and SABMiller are becoming more attuned to the risks of negative consumer environmental perceptions.
Water is becoming scarcer, raising a fear that so-far manageable price increases could spike and leading drink companies take action to maintain access to water and fight their image as water hogs.
'Water is the new oil,' said Mr Steve Dixon, who manages the Global Beverage Fund at Arnhold & S. Bleichroeder, repeating what has become a mantra as climate change and population growth tax water supplies.
'As an investor, I'm not concerned about the reality,' Mr Dixon said, guessing there will always be enough water overall. 'But I'm aware of the perceptions... and you can't totally shrug it off because perceptions are important.'
About a third of the world's people now live in areas of water stress, said Ms Brooke Barton, manager of corporate accountability for Ceres, a network of environmental groups and investors seeking to address sustainability challenges. By 2025, she said it will be more like two-thirds.
