When businesses talk about climate risk, they increasingly end up talking about water. Floods, droughts and pollution are no longer distant environmental issues; they are disrupting factories and farms, cutting off workers and communities, and reshaping where and how companies can operate. For the millions of people whose livelihoods depend on water‑stressed value chains, this is already a daily reality.
At the same time, regulators and investors are asking tougher questions about how companies manage their impacts and dependencies on water. Mandatory sustainability reporting, from Europe’s Corporate Sustainability Reporting Directive to evolving rules in the UK and beyond, is raising the bar on credible water disclosure. For companies with global supply chains touching vulnerable communities, this is about more than compliance – it is about long‑term resilience and shared prosperity.
Water as a social and business risk
One in five companies now reports significant water‑related supply chain risks, with tens of billions of dollars of value at risk and a growing share of global GDP generated in high water‑risk regions. Behind those numbers are workers facing lost wages when production stops, smallholder farmers struggling with erratic rainfall, and communities whose rivers and aquifers are under pressure from competing demands.
As our Chief Executive Officer, Adrian Sym, recently said, “Water is now a board level risk as water related shocks are already disrupting supply chains and undermining business continuity”. For practitioners working at the intersection of business, social impact and resilience, this convergence of physical risk and social vulnerability is a critical frontier.
Environmental risks, including extreme weather and ecosystem decline, remain among the most severe global threats over the next decade. Healthy rivers, wetlands and aquifers act as “natural infrastructure” for climate resilience, food security and human wellbeing. When these systems are degraded, the poorest people in supply chains are most exposed.
A practical framework for stewardship
In response, AWS has launched Version 3.0 of the International Water Stewardship Standard – a globally recognised framework that any major water user can apply, in any sector and geography, to understand and manage water risks, safeguard shared resources and deliver positive outcomes for communities, nature and business.
The updated Standard builds on a decade of implementation and evidence across sectors from food and beverage to technology, pharmaceuticals, retail and automotive. Companies such as Nestlé, Diageo, Unilever, The Coca‑Cola Company, Suntory, Apple, Cisco, Samsung, Haleon, AstraZeneca, Primark and Audi are already using or engaging with the AWS framework, signalling that water stewardship is moving into the mainstream of corporate practice.
At its core, the AWS Standard guides sites through a five‑step process:
- Understanding water use and impacts, and engaging local stakeholders on shared water challenges
- Committing and planning actions that balance social, cultural, environmental and economic needs
- Implementing responses at both site and catchment level
- Evaluating performance to drive continual improvement
- Communicating transparently on water stewardship efforts and outcomes.
An independent evaluation of Version 2.0 found that using the Standard can deliver social, environmental and economic benefits – from better community engagement and improved access to safe water, sanitation and hygiene (WASH), to groundwater recharge, new habitats and job creation linked to more reliable water flows.
What is new – and why it matters
Version 3.0 is the result of a major revision process, informed by two rounds of global public consultation and more than 3,000 comments from over 100 organisations and individuals. It was adopted by AWS Members in December 2025, with 93 percent voting in favour.
The updated Standard strengthens the framework in three main areas:
- Practicality: Streamlined requirements reduce complexity while maintaining rigour, including a clearer definition of minimum expectations and a more accessible starting point for companies new to water stewardship.
- Utility: The Standard is better integrated with broader sustainability agendas, with new requirements to understand climate impacts and build resilience, a clarified outcome focused on healthy freshwater ecosystems and biodiversity, and explicit integration of collective action across all certification levels.
- Value: There are stronger links to corporate‑level reporting and disclosure, including enhanced interoperability with EU CSRD and ESRS E3 Water, and maintained alignment with frameworks such as CDP and the Taskforce on Nature‑related Financial Disclosures.
For Business Fights Poverty’s audience, several aspects are especially relevant. AWS Standard 3.0 reaffirms safe water, sanitation and hygiene as a core pillar of credible water stewardship, with clearer, more streamlined requirements and stronger alignment with climate resilience and catchment health.
Healthy freshwater systems underpin livelihoods in sectors from agriculture to manufacturing. Aligning corporate action with catchment‑scale priorities can help businesses both manage their own risks and contribute to restoring and protecting rivers, aquifers and wetlands.
From efficiency to catchment‑level collaboration
Many companies start their water journey by focusing on efficiency within their own operations – reducing consumption per unit of output, for example.
Water stewardship builds on this by working beyond an individual site’s fenceline at the catchment level. AWS certified sites report benefits including improved relationships with local communities and authorities, increased investor confidence, enhanced brand reputation, better water quality and balance, groundwater recharge, new habitats and lower costs through reduced water use and greater efficiency.
For practitioners seeking to build more equitable and resilient value chains, a catchment‑level approach can support social impact goals by embedding meaningful stakeholder engagement, creating local employment opportunities and integrating gender and inclusion considerations into water governance processes.
What this means for action in 2026
As the world marks UN World Water Day, AWS is calling on companies, investors and financial institutions in all regions to put water at the centre of their climate and nature strategies. For members of the Business Fights Poverty community, the message is clear: treating water as a strategic, board‑level issue is now essential to protecting both business continuity and the wellbeing of the people and places that businesses rely on most.
