Water shortages: How does CSR address it?

One of the critical resources related to global climate change issues is water. In 2030, water supplies will meet less than 50 percent of global demand in many developing regions where water supply is already under stress (McKinsey Quarterly, December 2009).

In a country like Indonesia, the issues are scarcity, runoff (due to deforestation) and rainwater floods. Although many references on water conservation have been written, I am writing this article not to add scientific readings or empirical evidence but to call for action on the part of the private sector to provide solutions rather than adding to the problems.

On one hand, water shortages are happening in the dry areas of Indonesia such as the eastern islands due to scarce resources, which are accepted by local communities pretty much as a natural faith. On the other hand, in areas where water is supposedly abundant, people find it hard to obtain clean water because their water catchment areas are deteriorating due to over-development or misuse.

In time like these when it rains heavily almost every day, people psychologically feel that there is too much water and it causes more problems (floods, traffic jams) than benefits.
The way of thinking should see it as an opportunity rather than a problem. Rainwater is a useful resource of clean water (when recycled) or even drinking water (when filtered properly using reverse osmosis membrane). Due to people’s ignorance, all rainwater is washed away and wasted.

It is easy for us to complain about the government’s inability to provide enough drinking water through the state-owned drinking water company (PDAM), but why don’t we take action rather than blame others? Provision of water at the community level can be done independently using appropriate technologies. The question is: “Do we care enough to invest or donate the technologies for the community?”

In this day and age when corporate social responsibility (CSR) has become well known, its real meaning is often misinterpreted as donations or charity. Does it mean providing water for a community is a CSR program? The answer is like two sides of the same coin. Why? On one side, it is a true CSR program for companies that use lots of water in their operations as it is related to water efficiency that goes along with a responsibility to ensure their surrounding communities will not suffer from water shortages because of the companies’ operations. On the other side, water provision can be seen as a business opportunity that provides a solution for the community; hence it refers to social entrepreneurship.

Many large companies in Indonesia increasingly care about water issues, because water is a strategic commodity for them. Many are providing communities surrounding their factories with access to water by involving villagers in the management and sustainability of small-scale water treatment facilities. A partnership between an international beverage company and donor agency runs a program that responds to strong community demand for expanded access to clean and safe water for the poor in Bekasi, on the outskirts of Jakarta. The program also acknowledges the need to improve awareness among the community on environmental issues and conservation practices. The impact has been significant. Thousands of people living in these communities are directly benefiting from the program as more than 400,000 square meters of agricultural lands have gained improved access to water and thus enable them to carry out better agricultural practices. Shallow well improvement, community-based sanitation systems, bio-digester tanks and other water-related infrastructure were also improved/installed.

Another international food and beverage company is working together with the Indonesian Red Cross (PMI) on a project aimed at assisting communities in getting access to safe, clean water in Serang regency, West Java. A well has been built along with a water holding tank with a capacity of 30,000 liters complete with distribution pipes. Public mandi/cuci/kakus (MCK) or Bathing/Washing/Toilet centers have been provided as well as public water taps.

A series of training programs for the residents covering topics like water management, cleanliness and environmental sanitation has been conducted to inspire some in the community to become leaders in changing life. This initiative, if equipped with an entrepreneurship model, would generate income for the community, which means the purchasing power of their customers also increases.

A major cement manufacturer dedicates its CSR initiative to the provision of clean water and sanitation for villagers in East Java, who in the past had to travel three to five kilometers by bicycle in order to get clean water. The water project currently serves 600 families of 2,400 people in the area, involving a 3.9-kilometer water pipe development. Another good example of social entrepreneurship development is what a mining company is implementing in East Kalimantan. By providing simple clean water technology, it helps the nearby communities generate income from selling drinking water while the clean water is provided free as part of the company’s contributions to the community.

If we look at the value chain perspective, CSR brings mutual benefits for all. Global industrial producers must see the range of opportunities for the distribution of new water treatment products and services. The government is given a time to solve this problem through large-scale development programs, although the independent water producers or CSR players should not be seen as taking over the government’s role. The community is certainly enjoying better access to water, which allow them to adopt a health lifestyle.

The market for small-scale water treatment requires growth in technology, equipment and services. It also requires empowerment of the buyers (the users), which are primarily the community. Such community-based systems must adopt multi-sector partnerships involving local government (up to the village level), private sector and civil society. Although building a multi-sector partnership is not always easy, but with mutual trust, transparency and mutual beneficial approaches such an initiative is doable if not lucrative.

From a CSR standpoint, it is essential for the companies to emphasize water efficiency in their production processes, as it is a long-term requirement to make their business sustainable along with environmental conservation.

Providing water for a community should not be about “washing away the sin” after the companies waste or utilize so much water. By doing so, the business growth would bring in community welfare, which results in societal acceptance of their business.