The report, Sharing Water: Engaging Business, emphasizes the crucial role of business in ensuring responsible management of water resources and encourages greater collaboration across sectors. The report finds that leading companies have begun shifting their perspective beyond merely managing operational water use to becoming more conscious of how corporate actions impact local and regional water resources and, conversely, how water resources and watersheds impact business.

"Increasing global demand and the impacts of climate change are placing unprecedented strain on freshwater resources," said WBCSD President Peter Bakker. "In order to ensure a viable business future, companies are calling for collective management and collaboration at the watershed level to ensure continued access to water supplies among competing demands."

The report cites alarming findings from the Organization for Economic Co-operation and Development (OECD) that, under business as usual, water demand will increase by 55 percent globally by 2050, leaving little scope to meet increasing water demands while respecting the needs of ecosystems. With no improvement in the management and use of freshwater resources, the world could face a 40 percent supply gap by 2030.

A watershed approach takes into consideration upstream and downstream interactions, direct and indirect impacts, and the needs of the environment. For many businesses, this approach is a more cost-effective method to mitigate water risks and provides significant benefits and opportunities through new revenue prospects, reputation enhancement, improved compliance and cost-savings.

According to the report, the challenge of water management is complicated by the localized nature of water quality and quantity, which are determined by a range of local factors including geography, geology, climate, demography, infrastructure, competition and regulation. No two watersheds are the same, and, as such, some regions are less susceptible to water constraints while others face scarcity and pollution challenges.

"Collaboration is urgently needed. Business alone cannot ensure sustainable water use across a watershed," said Bakker. "To accelerate the impact of a watershed approach, companies must advocate for and contribute to an efficient regulatory environment that governs all water use in a watershed."