Corporate Water Neutrality

Corporate water neutrality is the goal of reducing a company's water footprint as far as possible and then balancing the residual volume through replenishment and water-quality projects in the catchments where the company and its supply chain operate. The aim is to leave a neutral or net-positive impact on local water resources, in both quantity and quality.

Unlike carbon, water is a local resource: a litre saved or replenished in one basin does not offset a litre consumed in another. For this reason, credible water neutrality is always assessed at the level of the specific basins a company affects, prioritising those under water stress.

How corporate water neutrality is approached

Good practice follows a reduce-first logic, broadly aligned with the Alliance for Water Stewardship (AWS) International Water Stewardship Standard, which guides sites through five steps: gather and understand, commit and plan, implement, evaluate, and communicate and disclose.

• Measure the water footprint across operations and the value chain, following ISO 14046 and including water-related impacts in Scope 3 categories such as agricultural inputs.
• Reduce consumption and improve discharge quality through efficiency, reuse and process changes, setting context-based targets in line with each basin's condition.
• Replenish the residual volume with projects that generate measurable water benefits in the affected basins, such as wetland restoration, efficient irrigation or improved wastewater treatment.
• Verify and disclose results transparently, typically through frameworks such as CDP Water Security and AWS certification.

How replenishment is quantified

To make replenishment claims comparable, companies use the Volumetric Water Benefit Accounting (VWBA) method, developed by the World Resources Institute (WRI). VWBA estimates the volume of water returned to or saved within a basin by a stewardship activity, providing a common, science-based unit for reporting water benefits.

A central principle is locating both impact and replenishment in the same water-stressed basins. Tools such as the Aqueduct Water Risk Atlas (WRI) and the AWARE characterisation factor help identify where action delivers the greatest benefit.

Why it matters for companies

• Operational resilience: reducing dependence on scarce water lowers the risk of supply interruptions in critical basins.
• Regulation and reporting: water is a material topic under the ESRS (notably ESRS E3 on water and marine resources) within the CSRD.
• Social licence: sharing a catchment responsibly strengthens relationships with communities and authorities.

Relationship with other concepts

Water neutrality is the water-focused counterpart of carbon neutrality: where carbon neutrality is now framed by ISO 14068-1, water neutrality relies on water-specific standards and basin-level accounting. It connects directly with water security and the reduction of water vulnerability.

At Manglai we help companies measure their environmental footprint, including water, and prepare their sustainability reporting under frameworks such as the CSRD. Discover how Manglai can help you.