Engaging in Water Stewardship

Water is a precious resource vital to life on the planet. In light of the urgent need to address emerging water challenges and also to reduce water-related business risks, we aim to enable a sustainable water future across our value chain through innovation and collaboration.

Key Facts

At Henkel, we recognize that water is a precious shared resource, essential to both people and the planet, with a high cultural, spiritual, environmental, and economic value.
With our corporate purpose “Pioneers at heart for the good of generations” we strive to enrich and improve life every day through our products, services, and solutions. We live this purpose in the way we design and implement our water stewardship plan: from the raw materials and facilities that we rely on, to the customers and consumers we serve.
For decades we have been working to reduce water use at our production sites. Via our brands we are running consumer education initiatives encouraging our consumers to be mindful of water scarcity issues and we are developing product solutions to reduce water consumption in the use phase. Furthermore, we are enabling our customers to reduce their water consumption and increase water quality in application processes through innovative solutions in adhesives, sealants, and functional coatings.
We aspire to leverage our strengths to enable a sustainable water future across our value chain, by focusing on the places that are key for our continued operation and that are a priority to our consumers, customers, and communities. As a first step, we are working to identify priority watersheds across our value chain to understand where and how we can contribute to better water quality and reduce quantity consumption. In 2021, we already set a new water ambition for our operations, aiming for circular water use at key manufacturing sites facing water risk by 2030.

Introduction

Water is an essential resource for people, business, and nature. Human overexploitation and mismanagement of water resources has resulted in a global water crisis that, since 2012, the World Economic Forum ranks as one of the top five global risks in terms of its effect on society.¹ Despite being a global issue, water challenges are local in nature, and are being exacerbated by climate change, further impacting the availability and quality of water in many places around the world.

To build on our strengths, in our 2030+ Sustainability Ambition Framework we have identified three key levers for change to drive the greatest impact across our value chain. This applies to how we manage our water resources:

People are our focal point, and through their expertise we can integrate and embed advanced water management practices across functions in ways that will enhance both business and societal value. This also includes working collaboratively on water-related solutions with the people in our supply chain, our customers and consumers, our neighbors, our shareholders, and the communities we operate in.
Products and technologies, to offer customers and consumers innovative ways to strengthen performance while driving improvements in watershed health.
Partnerships, because water is a shared resource, delivering long-term systemic change at scale can only be achieved by working with others across Henkel’s value chain through coordinated action at the watershed level.

Water is a key area of the Nature Pillar of our 2030+ Sustainability Ambition Framework. In this pillar we aim to protect and restore biodiversity, with focus on forests, land and water, through responsible resource stewardship.

¹_{The Global Risks Report 2021 16th Edition, https://www3.weforum.org/docs/WEF_The_Global_Risks_Report_2021.pdf}

Our ambition and targets

Henkel recognizes the critical role water plays across our operations, supply chains, and the communities we serve. We are aiming to enable a sustainable water future across our value chain through innovation and collaboration. Our aim for a sustainable water future is consistent with the United Nations Sustainable Development Goal 6,² a future with water availability and sustainable management of water and sanitation for all.

To achieve this ambition, we have started by addressing our operational impacts and improving watershed health where we operate, by building on our existing water efficiency target and achieving circular water use at key manufacturing sites facing water risk by 2030.

In parallel we are also exploring opportunities to improve water quality and its availability through our products, services, and solutions. We are doing that by first identifying our priority watersheds, where we have operations, supply chain and consumer markets. That will provide the foundation required to understand where Henkel is best positioned to deliver measurable long-term benefits for people and the planet.

²_{United Nations Sustainable Development Goal 6: https://sdgs.un.org/goals/goal6}

Ongoing activities and planned actions

Sustainable water management in our operations

We take full responsibility of our operational impacts. We have continued to progress against our existing water efficiency target. We set the goal of using 35 percent less water per ton of product by 2025. To achieve our goal, each production site carefully examines all options for reducing water consumption and avoiding wastewater.

Additionally, at our key manufacturing sites facing water risk, we have committed to achieving circular water use by 2030. Achieving circular water use will help Henkel reduce our dependency and impacts on precious water resources while contributing to increase watershed health. We will do that by optimizing on-site water use, increasing beneficial return flows back into the environment, and compensating for any remaining impacts by restoring and replenishing water back to the watersheds where we operate.

Across all operations, we work to provide a safe and healthy work environment, including safe water for drinking and hygiene, while making sure facilities and suppliers do not impact the human right to water in the communities where we operate. We strive to engage our key suppliers to comply with our requirements.

Strengthening internal water governance and management practices across Henkel

We will continue to strengthen capabilities, roles, responsibilities and accountability across Henkel’s internal governance structures and functions, including its supply chain steering group and sustainability council.

In order to identify production sites in regions with elevated water risks, we carried out detailed investigations at a global level again in 2022 using the World Resource Institute’s ‏(WRI) Aqueduct™ tool and the WWF Water Risk Filter screening tool. Building on this analysis, in the next step we focus our measures on the identified production sites in order to enhance our business resilience and contribute to a sustainable future. We took into account qualitative, quantitative and regulatory risks for all sites, as well as water risk forecasts for the year 2030. Each production site was assessed, taking into account its precise geo-coordinates and nearby water basins and watersheds.

An expert team will review and update our existing water risk and impact assessment, at least every three years, to incorporate new learnings and changes in our value chain footprint and inform internal opportunities to adapt and improve Henkel’s water stewardship position overtime. In manufacturing sites facing water risk, we will monitor and respond to water risks on an ongoing basis and ultimately increase operational resilience and supply security.

Innovative solutions that enable our customers and consumers to save water

We are developing products that do not require the use of water in the use phase. For example: our leave-in conditioners and dry shampoos do not require water for rinsing and we make significant investments in new concentrated formulations of our laundry detergents that enable our consumers to achieve excellent washing results while the detergent requires less water in its production. Also, we engage with customers of our professional salon business and innovate together on tools and solutions to reduce water use during the application of our products.

Finally, we are developing innovative solutions in adhesives, sealants, and functional coatings that enable sustainable water management at our customers. Our adhesives technologies contribute to reduced water consumption in production processes and the use phase.

Targeted investment in our consumer education programs

Most of the water consumption across our value chain takes place downstream, as part of the use-phase of our products, services, and solutions. We want to continue encouraging the responsible use of our products to reduce this water consumption. At Henkel Consumer Brands we leverage our brands to raise awareness among consumers about sustainable product use. We do this by providing information on the products and on websites, and through supporting measures in sales outlets as part of our “Be smarter. Save Water” initiative to explain how consumers can help conserve resources and reduce the energy-intensive demand of hot water. We also draw consumers’ attention to this topic with our laundry detergent packaging, where we place the “be sustainable – wash cold” logo.

Leading in our formal reporting obligations

We will continue to report progress against our water stewardship position on an annual basis via Henkel’s Sustainability Report, available on the Henkel website, in addition to continuing to participate in the Carbon Disclosure Project ‏(CDP) for Water. We will strengthen these efforts establishing effective data sharing and reporting processes on local water use, sources and impacts to support transparent disclosure and reporting.

Advancing global leadership and public policy engagement on water

Henkel is an endorsing company of the UN Global Compact CEO Water Mandate and sees engaging in water stewardship as an essential prerequisite to ensuring availability and sustainable management of water and sanitation for all.

The UN Global Compact’s CEO Water Mandate represents a commitment by the private sector to address global water challenges, in partnership with the United Nations, governments, civil society organizations, and other stakeholders. To achieve this, companies must engage in corporate water stewardship to identify and reduce critical water risks to their businesses, seize water-related opportunities, and contribute to water security and the Sustainable Development Goals.

We will strengthen our participation in the global dialogue on water and advocate for effective and efficient public water policy by engaging the public sector and other industries across our value chain.

Additional Henkel positions pertaining water topics:

Glossary of terms:

Sustainable water future: a future with water availability and sustainable management of water and sanitation for all, in line with the United Nations Sustainable Development Goal 6.
Watershed: The geographical zone in which water is captured, flows through, and eventually discharges at one or more points (Source: The AWS Standard 2.0 - Alliance for Water Stewardship ‏(a4ws.org))
Watershed health: Watershed health refers to the water quantity, quality, and ecosystem conditions within a watershed. A healthy watershed has balanced water quantity, good water quality, and healthy ecosystems, supported by appropriate infrastructure and good governance. A healthy watershed protects human health, maintains viable ecological functions and processes, and supports self-sustaining populations of native fish and wildlife species (Source: City of Portland 2005, modified by authors).
Priority watersheds: TBD, this will be defined by Henkel as part of the next phase of work. Likely definition: watersheds where Henkel has a high dependency on water, high exposure to water risk and high ability to influence and drive change across its operations, supply chain and consumer markets.
Circular water use: process for reducing, preserving, and optimizing the use of water through waste avoidance, efficient utilization and quality retention while ensuring environmental protection and conservation (Source: Morseletto et al. 2022).