WaterAid's Ruth Romer says the charity is working with the likes of Unilever, Diageo, Twinings and Gap Inc to show that there are business benefits from providing clean water, decent toilets and hygiene facilities to all workers in supply chains
Companies seem increasingly keen to capture and justify the commercial impacts of the choices they make; with 46% saying the absence of a clear business rationale is the biggest barrier to action within an organisation.
This highlights the importance of finding a way to measure effectively the benefits to business investment in social and environmental issues. If we can identify the financial return for investing in water, sanitation and hygiene (WASH), we can provide a clear rationale and business case to justify the spend. These facilities are vital for people’s success in the workplace and in the communities where they live, and crucially, this applies to each link in the supply chain.
In partnership with WaterAid, companies from a wide range of sectors are piloting the Business Case for WASH. We are now building a compendium of shareable insights on defining a return on investment (ROI) for WASH, both in field and factory contexts.
The business benefits for these projects could lead to lower health clinic costs, fewer fees covering staff absence and increased worker retention
Ensuring decent working conditions in global supply chains could create positive impact for millions. The potential scale and reach is large, especially given that 80% of global trade passes through global supply chains each year.
However, the range of physical geographies and contexts of different strands of the supply chains can present challenges for a global brand, not to mention gaining access to its supply chain. Successful engagement with suppliers is easier in all sector contexts where the global brand owns, operates or is the main buyer from that supplier. In these scenarios, a top-down mandate from the parent brand can really help to lever action on the ground.
WaterAid is currently working in agricultural supply chains with Unilever in a tea plantation in Kenya, Diageo in barley supply chains in Tanzania, and Twinings in tea estates in India. Ensuring access to taps, toilets and good hygiene behaviour can be more challenging in these field-based locations.
Variables such as the seasonality of the work and the size and scale of the farm mean there’s often no clear distinction between the living and working conditions for these workers. For the buyer or brand, it can be challenging to establish and monitor standards around WASH provision.
Assessing business benefits and defining a ROI from WASH in these field-based pilots is not straightforward, given the size and scale of a field-based workplace scenario. However, early indicators show that potential outcomes will often be related to a reduced occurrence of water-borne diseases or illness, leading to decreased worker absence and improved worker wellbeing.
The business benefits and ROI for these projects could lead to lower health clinic costs, fewer fees covering staff absence, and increased worker retention due to an improved feeling of wellbeing. It’s important to note that attribution in agricultural supply chains can be challenging given that ultimately, the climate and weather will affect the success of a crop.
Companies are responsible for their workers, and sustainable business practices are not a choice but a commercial imperative
A factory-based scenario is in some ways more organised and potentially more manageable given the containment within buildings, scale and size. However, some companies are quite unstructured with a high density of workers, which presents different challenges.
WaterAid, with support from HSBC, is currently working in large-scale tanneries and more community-based artisanal workers in India. In addition, improvements are under way in the ready-made garment factories in Bangladesh, and with Gap Inc in a cut-and-sew factory in India.
Hygiene behaviour change, which can be the forgotten pillar of WASH, must be the top priority, with the focus being on having a decent toilet and handwashing facilities. Where the workforce is predominantly female, for example in the garment industry, good provision for menstrual hygiene management is essential.
In the tanneries, with a mainly male workforce in direct contact with many chemicals, the clear requirement is for somewhere to wash and clean themselves, to avoid any chance of associated illness due to the tanning process and close contact with chemicals.
With all these pilots, the main impacts are likely to be linked to decreased staff absence due to illness or menstruation, increased worker productivity, and greater employee retention. The ROI for the parent company will be financially linked to each of these benefits.
Companies are responsible for their workers, and sustainable business practices are not a choice but a commercial imperative.
Despite the challenges, individuals must have access to water, sanitation and hygiene facilities for a healthy, strong and productive life
Despite the challenges, the network of individuals – from the delivery of source materials from the supplier to the manufacturer, through the manufacturing process, to its delivery to the end user – must have access to water, sanitation and hygiene facilities for a healthy, strong and productive life.
Our pilots are revealing a valuable insight into the different opportunities for WASH improvements within supply chains. The data will provide a foundation for the analysis of ROI, and will further build the financial business case for investment in WASH.
WaterAid is sharing these insights at Stockholm World Water Week, providing a useful opportunity to generate interest in this topic with different sectors and encourage companies to also test the business case for WASH.
For more information, please visit washmatters.wateraid.org/uk/business-case-for-WASH
Ruth Romer is private sector advisor for WaterAid.