CONTEXTUAL WATER TARGETS - A PRACTICAL GUIDE TO SETTING CONTEXTUAL CORPORATE- AND SITE-LEVEL WATER TARGETS APRIL 2021
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CONTEXTUAL WATER TARGETS A PRACTICAL GUIDE TO SETTING CONTEXTUAL CORPORATE- AND SITE-LEVEL WATER TARGETS APRIL 2021
Publisher
WWF Germany & WWF Sweden
Lead Author
Rylan Dobson
Co-Author
Alexis Morgan
Contact
CONTENTS
Rylan.Dobson@wwf.de
Acknowledgements
Ariane-Laport Bisquit (WWF-DE)
Gyan deSilva (WWF-US)
Caroline Gelderblom (WWF-SA)
Karin Glaumann (WWF-SE)
Richard Lee (WWF-INT) EXECUTIVE SUMMARY 3
Monica McBride (WWF-US)
Sarah Wade (AWS)
Design
PART 1: INTRODUCTION 5
Lou Clements
TARGET SETTING IN THE CONTEXT OF WATER STRATEGY 6
Cover image
© Roger Leguen / WWF GOALS, TARGETS AND METRICS 7
April 2021
PRIVATE SECTOR PERFORMANCE TARGETS 8
Please cite this report as:
Dobson, R. and Morgan,
PRIMER ON FORMS OF WATER TARGETS 9
A.J. (2021).
Contextual Water Targets.
WWF
COMPONENT PARTS OF TARGETS 11
ENGAGING EXTERNAL STAKEHOLDERS 10
PART 2: SETTING CONTEXTUAL TARGETS 13
STEP 1: EVALUATE 13
STEP 2: STRUCTURE 17
STEP 3: VALIDATE 21
STEP 4: AGREE 23
STEP 5: ROLL UP 24
CONCLUSION 25
REFERENCES 26
CONTEXTUAL WATER TARGETS 2
EXECUTIVE SUMMARY
Target setting is common practice within business environments
and is not only a tool for continual performance improvement, but also
for driving the delivery of business strategies.
Like standard business targets, water targets are Such “purpose driven” business strategies
also most effective when aligned to the delivery are a general trend that shapes the thinking
of strategic water goals. This guidance builds on underpinning this report (Grayson, et. al., 2018).
WWF’s experience and work on corporate water
The translation of “purpose” within water
WHAT THIS MEANS stewardship and target setting and is rooted in
the logic that a corporation’s water programme
targets requires accounting for water-related
IN PRACTICE FOR should be in service of the wider corporate and
challenges that the business is exposed to
BUSINESSES IS THAT business water strategies, create value for as many
within the basin(s) (or context) in which it
operates. This can be achieved by either setting
ACCOUNTING FOR stakeholders as possible, and set the corporation
contextual water targets or water science-
“PURPOSE” THROUGH on a pathway towards delivering meaningful
positive impacts that help to address societal and
based targets (water SBTs). What this means
THE PERFORMANCE environmental challenges.
in practice for businesses is that accounting
OF ANY FORM OF As businesses look to the trends that will shape
for “purpose” through the performance of any
form of water targets requires the level
WATER TARGETS their strategies, climate change, biodiversity loss of performance to be increasingly tied to local
REQUIRES THE LEVEL OF and increasing water stress are consistently at the hydrological and/or scientific data. In addition,
PERFORMANCE TO BE top of the list of factors that need to be accounted the coverage of water-related challenges on
INCREASINGLY TIED TO for. Indeed, many leading businesses are
increasingly pushing towards business strategies
which these targets focus needs to be narrowed
down to those water-related challenges that
LOCAL HYDROLOGICAL that are not just rooted in “sustainability” but also are strategic or materially relevant (to the
AND/OR consider how they can help solve wider challenges, target setter and other users within the
SCIENTIFIC DATA. which can impact future business growth. surrounding context).
© Brent Stirton / Getty Images
CONTEXTUAL WATER TARGETS 3
© James Suter / Black Bean Productions / WWF-US
Contextual water targets represent a middle CDP, TNC, WRI, WWF, UNEPDHI, 2019) and
ground between non-contextual and water SBTs. Setting Enterprise Water Targets Informed by
These targets embrace efficiency and management Catchment Context (publication pending). This
concepts (traditionally non-contextual approaches) guide provides five practical steps and guidance
but move further by accounting for the needs on how to balance top-down corporate-level
of local water-related challenges. They do not, strategic objectives with bottom-up contextual
however, go so far as to tackle precise levels of water insights from a site level to construct
performance required by a business to contribute meaningful contextual targets. However, it is
towards the achievement of basin-level science- neither intended to be prescriptive nor to propose
based outcomes. As such, contextual targets a formal methodology for setting contextual
represent a concrete starting point for businesses targets. Instead, WWF recommends that a
seeking to take the first step towards water SBTs. corporation adapts this framework to meet the
unique context of the corporation.
At the time of publication, there remains no
globally agreed methodology for setting water Lastly, WWF believes that setting corporate-
SBTs (however an early draft is currently being level water targets should be driven by rolling
piloted). However, early piloting of emerging out bottom-up site-level contextual/water SBTs,
thinking has shown that barriers exist to scaling which are created in service of a purpose-
water SBTs across the entire value chain of a driven water strategy and goals. However, it is
corporation. Rather than waiting until these important to note that this guidance does not
methods and guidance are available, WWF cover how a corporation places its water strategy
recommends that businesses get to work into the context in which it operates or how it can
setting contextual targets. Indeed, even once a set goals. For more guidance on this topic, WWF
methodology is available, there will likely remain has developed a separate publication, Putting
a need for contextual approaches for not only Water strategy into Context (Dobson and
corporations starting their water journeys, but Morgan, 2021), which sets out a framework for
also for less strategically relevant parts of the incorporating water’s context into strategy.
value chain where the work required to set a
THIS GUIDANCE IS
water SBT may not add value, as well as for those
for whom a SBT is not logistically or financially
feasible to develop (e.g., SMEs). PRIMARILY INTENDED
This guidance is primarily intended for those FOR THOSE RESPONSIBLE
responsible for setting corporate-level targets. FOR SETTING CORPORATE-
It is consistent with, and builds upon, thinking
that WWF has contributed to other publications
LEVEL TARGETS.
on water target setting, namely: Setting Site
Water Targets Informed by Catchment Context:
A Guide for Companies (CEO Water Mandate,
CONTEXTUAL WATER TARGETS 4
PART 1
INTRODUCTION
This guidance is designed to be implemented at a corporate-level,
however adopting a contextual approach to corporate-level water5 1
targets does need to be informed by bottom-up (or site-level) insights.
5 1
As such, there are steps (Validate and Agree) the alignment between top-down strategic
that need site-level input (Figure 1). The five business objectives and bottom-up site-level water
steps described within this guide are illustrated context. A summary of the objectives of each of
below in Figure 1 and are designed to strengthen the 5 Steps illustrated above is provided below:
2
Structure 2
Figure 1: 2
WWF’s Contextual
Target setting
framework designed
Evaluate 1 CORPORATE SITE 3 Validate
to establish a
LEVEL
4 LEVEL
more strategic
and contextually
Agree
appropriate corporate 3
water targets 5
3
Roll up
STEP OBJECTIVE OF STEP
1. EVALUATE Evaluate the strategic relevance of performance monitoring for specific water-related challenges at sites
within the prioritised "hot spots" of the value chain within the water strategy
2. STRUCTURE Structure the contextual targets for each water-related challenge using levels, components, and the interim milestones to
establish a suite of targets that can then be contextually assigned to individual sites within the priority value chain "hot spots"
3. VALIDATE Validate the assigned contextual targets at a site-level using local insights and data and set site-specific performance
trajectories for interim milestones – empowering sites to contribute bottom-up feedback into corporate-level target setting.
4. AGREE Agree any changes to the assigned contextual target based on the site-level validation of the water-related challenge
evaluation and/or the site performance trajectories that will contribute to the corporate interim milestones
5. ROLL UP Roll up site-level performance trajectories into a single, simple, and clear performance metric for each
interim milestone for each contextual target for each water-related challenge
Table1: Details of the objectives of each of the 5 steps within WWF’s Contextual Target setting framework
© WWF-Brazil / Adriano Gambarini
CONTEXTUAL WATER TARGETS 5
PART 1
TARGET SETTING IN THE
CONTEXT OF WATER STRATEGY
This guidance builds on the logic that a corporation’s water programme
should be in service of the wider corporate and business water strategies
and create value for as many stakeholders as possible while also delivering
purposeful impacts that address societal and environmental challenges.
WWF believes that the successful corporations of business strategies. Water targets are no
of tomorrow will be those which embrace different and, similarly, are most effective
purpose. Purpose “is the centralizing force that when linked to water strategies. Accordingly,
extends and embeds a corporation’s engagement there is a cascading logic built into this
with a sustainable future deeper into the culture report around how water, and its targets,
of the corporation. The next generation of our ladder up to deliver value and, in turn,
workforce (often referred to as millennial) support purpose-driven water strategies
typically hold values and expectations that (Figure 2). In this framing, the development
corporations should play an active role in solving of targets (embedded within the set step) is
societal challenges and as such this creates a most effectively done after the completion
stronger business case for embedding purpose of the assess, prioritise and define steps.
into the heart of a corporation’s strategy. This allows corporations to identify
Purposeful corporations increasingly focus the strategically relevant water-related
all that it does, from innovation to supply dependencies and impacts within the value
chain to manufacturing to marketing, through chain and determine the best focus areas
a lens of having positive impact in the world” before setting goals and targets. For more
(Grayson, et. al., 2018). information on how to integrate water and
context into water strategies, please see our
Setting targets is a core part of business, and companion guidance: Putting water strategy
targets are a key element in driving the delivery into context (Dobson and Morgan, 2021).
Figure 2:
WWF’s Putting Water BUSI
NE
strategy into Context POLIC SS
framework designed
GE
TS STRA Y &
R TEG
to establish a more TA Y VA
purpose-led water
CH L
strategy (Dobson and
U N
E
AI
Morgan, 2021)
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CONTEXTUAL WATER TARGETS 6
PART 1
GOALS, TARGETS AND METRICS
Terms such as Goal, Target and Metric are often used interchangeably.
However, within this guidance they are distinct terms and are used
according to the following definitions (adapted from Fisher (2020)
and Bernard Marr & Co (2021):
SETTING GOAL With the above in mind:
TARGETS IS A A statement that captures a larger more
strategic vision that a corporation aims to
1. Water strategy goals should be drafted or
CORE PART OF accomplish within a specified timeframe and is
defined ahead of developing any targets or
metrics.
BUSINESS, AND often used to communicate the focus areas of
TARGETS ARE A business strategies. 2. Water targets should include a specific metric
that is used to monitor the progress the
KEY ELEMENT TARGET corporation is making towards meeting its
IN DRIVING A statement that includes a specific, timebound strategic goals.
THE DELIVERY and quantifiable level of performance, in the
form of a metric that represents a point of
While the development of more meaningful
OF BUSINESS assessment, that can inform ongoing progress
water strategy goals is part of the set step within
WWF’s Putting Water strategy into Context
STRATEGIES. towards achieving a goal. Targets capture (Figure 1) (Dobson and Morgan, 2021), guidance
progress towards a goal. for developing goals falls outside of the scope of
this guidance. Rather, this guidance is aimed at
METRIC supporting a corporation to develop the contextual
1
5
A unit of measure that helps a company targets that can, using appropriate performance
assess if it is achieving the objectives within a metrics, support the goals of a water strategy.
1
target. Often also referred to as a Key
5
The connection between this guidance and the
Performance Indicator. framework from WWF’s Putting Water strategy
into Context (Dobson and Morgan, 2021) is
illustrated in Figure 3 below.
2
Structure
2
2
Evaluate 1 CORPORATE SITE 3 Validate
LEVEL
4 LEVEL
Agree
5
3
Roll up
3
Figure 3:
Where the 5 corporate-level
contextual target setting AS
T S
steps fit into WWF’s broader
SE
ES
Putting Water strategy into
S
Context (Dobson and Morgan,
2021)framework -–the
E
highlighted wedged area of
IS
DE
IT
the framework represents the IN R
F
E IO
scope of this report. PR
CONTEXTUAL WATER TARGETS 7
PART 1
PRIVATE SECTOR PERFORMANCE TARGETS
Performance targets can be developed at different levels within a corporation –
either at a corporate-level or at an operational level (referred to as site-level
in this guidance) and, as such, these targets have different purposes and roles
at each level. A brief recap of these roles is outlined below:
CORPORATE-LEVEL of corporate-level water targets (Petryni and
Thompson, 2019). Site-level water targets are
Corporate-level water targets are a measurable, typically designed for internal use and are often
specific, and realistic translation of the mission, not disclosed externally. Historically, many of the
vision and goals of a corporation’s water strategy headline site-level water targets are assigned to
and are used to guide strategic decision-making. sites using corporate-level targets, while others
DIFFERENT While often difficult to directly translate into may be site-specific and operational in nature.
LEVELS WITHIN actionable day-to-day tasks or projects (due
Different levels within a corporation play different
A CORPORATION
to longer time frames), these targets set the
benchmark based on which a corporation will roles in facilitating the delivery of the outcomes
PLAY DIFFERENT measure its success. Corporate-level water targets of a water strategy. As such, water-related risks,
ROLES IN are typically designed for an external audience, opportunities and prioritisations manifest
differently at both corporate- and site-levels.
FACILITATING
meaning they are a distillation/aggregation of
all the complexities of site-level water targets Practically this means that while corporate- and
THE DELIVERY OF into a “single” (or a few) water target(s) and are site-level water targets are interrelated, corporate-
THE OUTCOMES often aligned with external frameworks (e.g., UN level water targets are unlikely to be achieved if
they cannot be linked to site-level water targets.
OF A WATER
Sustainable Development Goals or SDGs).
Similarly, site-level water targets would lack
STRATEGY. SITE-LEVEL cohesion if developed without consideration of
corporate-level water targets or the broader water
Site-level water targets are also measurable and strategy. Put simply, to set meaningful corporate-
specific, but typically provide day-to-day direction level water targets, a balance needs to be found
to site-level employees. They are used primarily between using bottom-up (site) insights to inform
to allocate internal resources and focus to ensure top-down (corporate) water targets, which ensure
site-level efforts contribute towards the success cross-cutting (corporate-level) cohesion.
© Adriano Gambarini / WWF Living Amazon Initiative
CONTEXTUAL WATER TARGETS 8
PART 1
PRIMER ON FORMS OF WATER TARGETS
WWF believes that over time water targets will require greater
alignment with water-related challenges within the surrounding
basin(s) (or context) in which a corporation operates. The logic
is that one must tackle shared water challenges to:
AN OUTLINE 1. Mitigate exposure to basin water risks: providing guidance on the evolution of water
TYPOLOGY OF
To effectively do so, it requires sites to focus on targets. From these efforts an outline typology
solving the water-related challenges that are of water targets has emerged, which can be
WATER TARGETS the root causes for those physical, regulatory, or helpful to categorise the different types of
HAS EMERGED, reputational water risks facing the corporation water targets that are commonly discussed –
based on the performance and the coverage
WHICH CAN BE
and driving potential financial impacts.
addressed by each form of target. These are
HELPFUL TO 2. Harness opportunities and purpose-
driven strategies: Again, to effectively
illustrated in Figure 4 and include:
CATEGORISE identify and harness such opportunities requires
THE DIFFERENT sites to identify, focus on, and credibly address, NON-CONTEXTUAL
TYPES OF WATER the water-related challenges facing the site and
the corporation. Or to put it differently, solving
WWF’s working definition of a non-
TARGETS THAT such challenges will create purpose-driven
contextual target is “a target that does
not consider surrounding water-
ARE COMMONLY opportunities for the corporation.
related challenges but is rather influenced
DISCUSSED. 3. Efficiently allocate scarce internal by exercises such as benchmarking, a
resources: The array of challenges facing desire for incremental improvements,
sites will continue to grow, which means compliance or general corporate-level
that corporations must address root causes. ambitions.” In short, this type of target is
Accordingly, sites will increasingly need to focus often aimed at improving internal efficiencies
efforts on the issues that are most strategically and water management practices and is
relevant and either reduce risk or create value. typically driven largely by internal agendas.
Like in medicine, where it is much less expensive
With this form of water target, the
to prevent a disease than to try to cure patients
performance and coverage are largely (often
once they are sick, tackling select shared water
completely) unconnected to the state of local
challenges becomes a key pathway to efficient
water-related challenges. In most cases, these
resource allocation.
targets are usually driven by internal corporate
While this guidance covers the development of objectives such as a desire to improve specific
contextual targets, it is important to set out WWF’s internal metrics, responding to external
view as to how this form of target integrates in regulatory requirements (impact reductions)
the broader landscape of target-types commonly or a response to peer benchmarking (which
referenced in water stewardship literature. As water includes what is technologically feasible).
targets move from being unconnected to the current
However, there is a subset of this form of water
state of local water-related challenges (i.e., non-
target that begins to adapt the coverage of
science-based) toward being explicitly connected to
targets to reflect specific global water-related
the current state of local water-related challenges
policy agendas (e.g., SDG6) but does so without
(i.e., water SBTs), two variables change, namely:
a connection to the actual local state of these
performance and coverage (Figure 4).
water-related challenges. One such example
Since 2016, WWF has been working with could be water-intensity targets (covering
other NGOs, including CDP, TNC, UN Global every site) framed using SDG 6.4 but without
Compact CEO Water Mandate, UNEP-DHI accounting for the local state of water balance
and WRI, on various efforts related to within each basin.
CONTEXTUAL WATER TARGETS 9
PART 1
CONTEXTUAL
Presently, the Freshwater Hub within the Science- With this form of water target, performance
Based Targets for Nature (SBTN) (SBTN, 2020a) builds from where contextual water target
defines a contextual target as a target that is performance ended by explicitly linking
“informed by the surrounding catchment performance to local hydrological data –
(basin) context and helps to focus resources or a science-driven definition of what is a
towards the right water-related challenges in “sustainable” state for a shared water-challenge
the right places and are strategically relevant within a given basin. The coverage of this form
to both the target-setting water user and other of water target is now far tighter and usually
water users in the catchment (basin).” In short, addresses only the most relevant and pressing
WWF RECOMMENDS this form of target is primarily aimed at ensuring local water-related challenges. It is also worth
THAT BUSINESSES the coverage of water targets is aligned with the
materially relevant water-related challenges at
noting that this form of target used to be
referred to as Context-Based Water Targets by
GET TO WORK either a site- or corporate-level. WWF until the term was discontinued in 2018.
SETTING With this form of water target, performance is At the time of publication, there remains no
CONTEXTUAL mainly driven by corporate-level efficiencies and globally agreed methodology for setting a
TARGETS AS management objectives but is adjusted slightly water SBT. However, the SBTN has published
THESE REPRESENT across sites to account for the state of local water- Initial Guidance that sets out the trajectory
A CONCRETE related challenges. The coverage, however, that
the water targets address is now more directly
towards setting water SBTs and is encouraging
corporations to complete steps 1 and 2 (SBTN,
STARTING POINT influenced by the state of local water-related 2020b). Within this Initial Guidance, it is step
FOR THOSE challenges. 3 that focuses on the target setting process
SEEKING TO MAKE and it is this specific methodology that is not
THE TRANSITION WATER SCIENCE-BASED TARGETS yet available. Rather than waiting until these
methods and guidance is available, WWF
TOWARDS MORE Presently, the Freshwater Hub within the Science- recommends that businesses get to work setting
SCIENCE-BASED Based Targets for Nature (SBTN) (SBTN, 2020a) contextual targets as these represent a concrete
FORMS OF TARGETS defines a water SBT as “a target as one that starting point for those seeking to make the
supports a company reduce their impacts on transition towards more science-based forms
freshwater resources are considered science- of targets. Indeed, even once a methodology
based if they are in line with what the latest is available, there will likely remain a need
hydrological science says is necessary to for contextual approaches not only for lagging
meet the sustainable freshwater quantity and companies, but also for less strategically
quality thresholds of the basin in which the relevant parts of the value chain where the work
city or company and its value chain operate.” required to set a water SBT may not add value.
NON CONTEXTUAL CONTEXTUAL SCIENCED-BASED
Figure 5: A target that does not consider Informed by the surrounding A target as one that supports a company
WWF’s adaptation surrounding water-related catchment (basin) context reduce their impacts on freshwater
of the emerging challenges but is rather and helps to focus resources resources are considered science-based
influenced by exercises such towards the right water-related if they are in line with what the latest
simplified typology
as benchmarking, a desire for challenges in the right places hydrological science says is necessary
of forms of water incremental improvements, and are strategically relevant to meet the sustainable freshwater
targets compliance or general to both the target-setting water quantity and quality thresholds of the
corporate-level ambitions. user and other water users in the basin in which the city or company
catchment (basin). and its value chain operate.
SCIENCED-BASED
Performance
NON-SCIENCED-BASED
TODAY FUTURE
Coverage
CONTEXTUAL WATER TARGETS 10PART 1
COMPONENT PARTS OF TARGETS
Robust and meaningful contextual targets should be constructed using five component
parts, described in Table 2, which will be developed more fully in Part 2 of this guide.
Table 2:
The five components COMPONENT DESCRIPTION FORMS DESCRIPTION OF FORMS
that are essential to
developing robust OBJECTIVE What the target Outcome • Sets out the results that the site is seeking to achieve
performance targets is aiming to Process • Sets out a thing or process that the site is seeking to
and the different deliver achieve
forms to which these
components can take
SCOPE Where (spatial Site • Specifically covers water performance within an
scope) the target individual site
will be focused Basin (region) • Specifically covers water performance or actions
outside the fence line
MEASUREMENT How the target Quantitative • Defined unit of measurement that can be used to
will be measured assess the progress towards a target
Qualitative • Defined quality of the objective rather than a
defined measurement unit
PERFORMANCE What level of First-order • Performance that could reasonably be expected to be
performance is (incremental) achieved based on the current state of operations
being set (Bartunek
& Moch, 1987)
Second-order • Performance that is “transformational”, “revolutionary”,
(discontinuous) “radical” or “discontinuous” and involves challenging
(Bartunek assumptions and working from a new worldview
& Moch, 1987)
Third-order • Performance that is adaptive and responsive to the
(adaptive) changing state of local shared water challenges
(Bartunek
& Moch, 1987)
TIMEFRAME When the level Time-bound • A defined unit of time that will be used to measure
of performance progress against
is expected to
be met
BOX 1 ALLIANCE FOR WATER STEWARDSHIP STANDARD
The Alliance for Water Stewardship (AWS) Standard (Version 2) (AWS, 2019) is globally recognised good
practice in site-based water stewardship and outlines a series of steps and criteria that define responsible
water stewardship. The standard requires an implementing site to first gather relevant contextual data
(Criteria 1.1, 1.3, 1.4, 1.5 & 1.6) and integrate the data into the site’s water targets (Criteria 2.3) and water
stewardship activities, including the development of detailed plans for how targets will be achieved
(Criteria 3.3, 3.4, 3.5, 3.7 & 3.8). As part of this, the standard advocates that targets are contextual in
nature through their coverage (Criteria 3.3.2 and 3.4.2).
However, the AWS standard does not provide any specific guidance on how a site can systematically
define, and evidence, how it has determined the coverage of the water targets, nor any detailed guidance
on how to set appropriate contextual performance levels for the water targets. The standard does,
however, provide guidance on how to collect locally relevant contextual data that can be used within
target setting. Accordingly, WWF believes this guidance note can supplement AWS guidance relating to
the above-mentioned criteria within the standard.
CONTEXTUAL WATER TARGETS 11PART 1
ENGAGING EXTERNAL
STAKEHOLDERS
Water is a complex, socially
negotiated resource. Not only does
it have localised spatial and
temporal variability, but its
perceived value differs among
those who use it.
Water is essential for developing and
maintaining healthy economies and the
health and wellbeing of humans and nature.
Equally, good water stewardship requires
a user to engage with other water users to
cultivate an understanding of not only their
own water use but also the concerns and
needs of other water users in the surrounding
basin. As a result, corporate target setting,
which is intended to speak to stakeholders,
faces a complex challenge in navigating
these variable values of water. So, WWF
would advocate that any corporation setting
contextual targets should consider including
a degree of engagement with local external
stakeholders while setting its targets.
© Patrick Bentley / WWF-US
CONTEXTUAL WATER TARGETS 12PART 2
SETTING CONTEXTUAL TARGETS
This section of the guidance outlines 5 Steps (Figure 6) that a corporation
1
5
can use to develop contextual targets at both corporate- and site-levels.
As discussed in Part 1, WWF recommends that any development of corporate-
1
5
level contextual targets is undertaken as part of a broader water strategy
development process (top-down), while providing clear direction to sites as
to how site-level targets will inform the corporate target setting process.
2
Structure
2
2
Evaluate 1 CORPORATE SITE 3 Validate
LEVEL
4 LEVEL
Agree
5
3
3
Figure 6:
The iterative flow
As such, a corporate-level contextual target
should be a rolled-up summary of the
STEP 1: EVALUATE
between corporate- Evaluate the strategic relevance of
performance and coverage of all local site-
and site-levels of the
based contextual targets, rather than a top- performance monitoring for specific
5 steps in this guidance
down non-contextualised target. Put differently, water-related challenges at sites within the
that can be used for
setting contextual corporate-level contextual targets are an prioritised “hot spots” of the value chain
targets aggregated reflection of the water context in within the water strategy
which the corporation operates rather than a A corporation must first evaluate how much
global non-contextualised target that is cascaded emphasis to place on performance monitoring at
down to sites. This represents a transformational the sites it has prioritised in the value chain “hot
shift for corporations when setting targets as it spots” for water-related challenges as part of
is likely to involve an inverse approach to more its corporate-level water strategy (see WWF’s
traditional target-setting practices. supplementary guidance Putting Water Strategy
As described above, contextual targets are into Context). It is important to note that often this
ideally developed in the service of a broader prioritisation of “hot spots” may result in parts of
water strategy since setting contextual targets the value chain being prioritised that were previously
is most effective when set within a strategy not considered within the corporation’s water
development process (Figure 3). The process strategy or target setting.
for putting water strategy into context goes To start this process, it is important to establish
beyond the scope of this report. If further a standard “definition” of what water-related
information on this is needed, we recommend challenges mean to the corporation (if not already
WWF’s companion guide Putting Water completed). Here, rather than creating new
strategy into Context (Dobson and Morgan, definitions, the corporation may consider choosing to
2021), which specifically focuses on embedding align its definitions of water-related challenges with
context into business water strategies. As such, other water-related frameworks. Table 3 includes
this guide begins with the assumption that the examples of how water-related challenges could be
above preparatory steps have been completed framed using the UN SDG 6 targets and the AWS
and that the target setting process is part of a outcomes.Once a corporation has established its
broader water strategy development process “definition” for water-related challenges, it is ready
(i.e., Figure 1). to complete its evaluation with respect to how much
CONTEXTUAL WATER TARGETS 13PART 2
emphasis it will place on performance monitoring Prior to completing the evaluation, it may be useful
for water-related challenges as part of its corporate- to first identify a series of proxy metrics (both
level water strategy. In completing this evaluation, Operational and Basin) that can be used to provide
it is important to factor in three dimensions, a degree of initial quantification for each factor of
namely: each water-related challenge. With respect to basin-
level metrics, where possible, WWF recommends
Current state using locally sourced water data (e.g., local data sets,
The current state of a water-related challenge local knowledge of staff or stakeholders). However,
within the immediate spatial context (e.g., where this is not possible, water risk mapping tools
surrounding basin) (i.e., how the water-related can provide basin-related proxy values (such as the
challenge currently manifests on the ground WWF’s Water Risk Filter or WRI’s Aqueduct). These
tools draw on global data sets (meaning the levels of
Dependencies local accuracy and granularity will
The degree to which the corporation or site may not be sufficient to set water SBTs but are sufficient
be sensitive to changes in the current state of a for setting contextual targets) to create a series of
water-related challenge (i.e., the level of reliance indicators that are a risk-interpreted representation
the corporation or site has upon the water-related of the status of water-related challenges.
challenge to maintain its operations) (Adapted –
While the use of these tools can be valuable at this
Enterprise Water Targets, 2021)
stage of the target setting process, WWF encourages
Impact/Influence further site-level validation of these global indicators
with locally sourced data relating to the water-
The degree to which the corporation or site could,
related challenge in question (see Step 3). To better
through its actions, contribute to a change in the
understand the differences and similarities between
current state of a water-related challenge (i.e.,
these tools, as well as the India Water Tool from
either through “negative” impacts or by “positive”
WBCSD, please see the publication Right Tool for
influence) (Adapted: Setting Enterprise Water
the Job: Tools and Approaches for Companies and
Targets – to be published 2021)
Investors to Assess Water Risks and Shared Water
In combination, evaluating the strategic Challenges (WWF & WBSCD, 2020). Regardless
relevance of performance monitoring for each of the which tool, data or metrics are selected for this
water-related challenge as part of a water strategy step, it is recommended that the following criteria
using these three factors enables a corporation to are considered when considering their use (adapted
get a more complete picture of its unique situational CEO Water Mandate, PI, CDP, TNC, WRI, WWF,
water context. The evaluation process should be UNEPDHI, 2019):
done using site-level data that is then aggregated up
to a corporate-level – meaning • What spatial scale is being represented by
each site within the prioritised value chain “hot these data? (i.e., basin-level, local, global)
spots” should be evaluated against the three factors
• How recent are these data?
and then these evaluations should be aggregated
up to a corporate-level. If a corporation does not • Who produced or provided this source of data
have access to data for the prioritised “hot spot” and are they well-respected?
within the value chain, WWF would recommend
• Is this resource well used or known by others?
that basic assumptions are made to enable the
completion of the evaluation but for the corporation • Will this resource help me to prioritise
to also develop a timebound plan to validate the between the water-related challenges in the
assumptions and substitute these with real data. surrounding context?
Table 3:
Example of an approach WATER RELATED CHALLENGES RELEVANT SDG TARGET AWS WATER STEWARDSHIP
to define water-related
challenges and align EXTERNAL GOVERNANCE* 6.5 Good water governance
these to SDG targets and
ACCESS TO WATER, SANITATION 6.1 & 6.2 Good water sanitation & health
AWS outcomes
& HYGIENE (WASH)
WATER QUALITY 6.3 Good water quality status
FRESHWATER BIODIVERSITY* 6.6 Important water related areas
WATER SCARCITY 6.4 Sustainable water balance
* When considering these FLOODING (ANNUAL) 11.5 Sustainable water balance
water-related challenges it
is important to also consider EXTREME WEATHER EVENTS 13.1 Good water governance/Sustainable water balance/
the socio-cultural aspects of
these challenges – not just (CLIMATE RESILIENCY) Good water quality status
the ecological aspects
CONTEXTUAL WATER TARGETS 14PART 2
It is highly likely that the chosen proxy An illustrative example for ACME Corporation
metrics, selected to evaluate the Current State, is shown in Figure 8. This output could also be
Dependencies and Impact/Influence of each used to communicate externally the pattern of
water-related challenge, may have different units of decision-making that ACME Corporation has
measurement. To make it easier to compare across used in determining how much emphasis it
sites, a corporation may wish to consider developing will place on performance monitoring as part
a simplified common index that can be used to of its water strategy. In Figure 8, we can see
translate the different metrics into a comparable set that ACME Corporation is facing considerable
of values. An example of a simple index that could be extreme weather events, but has a strong ability
used in an evaluation process is shown in Table 4. to Influence, while also facing moderately high
water scarcity (with high Dependency and high
To facilitate identifying how much focus to place
Impact). Conversely, WASH appears to be
on performance monitoring for each water-related
a low issue for this site.
challenge from sites within prioritised “hot
spots” as part of the corporate’s water strategy, The purpose of this evaluation is not to
the individual aggregated outputs for the three demonstrate which water-related challenges will
Table 4: factors for each water-related challenge can be not have performance targets assigned to them
Example of a simplified plotted to create a simple visual illustration of the but rather which water-related challenges need to
evaluation index
evaluation output. An example is provided in Figure have more ambitious performance levels assigned
that can be used to
7 where the numerical values for Current State and to them (see step 2) and which performance
evaluate Current state,
Dependencies and
Dependencies are plotted along the x- and y-axis against targets for water-related challenges will
Impact/Influence of while the numerical value for Impact/Influence is be highlighted and communicated more externally
water-related challenges visualised using colour and size. as part of the water strategy.
EVALUATION SCALES
VERY LOW LOW MEDIUM HIGH VERY HIGH
1 2 3 4 5
CURRENT STATE …almost …sufficient …moderate and …significant and/or …severe and/
non-existent and/or rarely /or occasionally frequently compromised or permanently
and or never compromised compromised compromised
compromised
DEPENDENCIES …continue as …experience …be subjected to …be subjected to major …be either temporarily
normal if the limited or short- major operational operational efficiency or permanently
state of the level operational efficiency and capacity reductions suspended if the state
water-related impacts if the and capacity if the state of the of the shared water
challenge state of the water- reductions if the water-related challenge changed
changed related challenge state of the water- changed
changed… related challenge
changed
IMPACT/INFLUENCE …has no ability … has limited … has a moderate has significant ability …has considerable
to influence an ability to ability to to influence an ability to influence
improvement in influence an influence an improvement in the an improvement in
the state of the improvement improvement state of the local the state of the water-
local water- in the state of in the state of water-related challenge related challenge
related challenge the local water- the local water- through reducing its through reducing its
through reducing related challenge related challenge existing impacts existing impacts
its existing through reducing through reducing
impacts its existing its existing
impacts impacts
……has no …has limited …has some … has significant …has considerable
potential to potential potential potential to leverage potential to leverage
influence to leverage to leverage both influence and both influence and
positive changes resources to resources to resources to actively resources to lead
in the water- facilitate positive actively engage support efforts to efforts to facilitate
related challenge changes to the with efforts to facilitate positive positive changes to
water-related facilitate positive changes to the water- water-related
challenge changes to the related challenge challenge
water-related
challenge
CONTEXTUAL WATER TARGETS 15PART 2
KEY Influence Impact Size = scale of Impact / Influence
Figure 7: 5 5
Right: Illustration Freshwater Biodiversity
of how the outputs Water Scarcity
4 4
of the evaluation of
HIGH VERY HIGH
the Current State,
External Governance
3 3
DEPENDENCIES
DEPENDENCIES
Dependencies and
Impact/Influence for
each water-related
2 2 Flooding
challenge (site-level
insights aggregated up
LOW MEDIUM Quality
Climate Resiliency
to a corporate level) 1 1
could be visualised WASH
to inform the focus
placed on performance 0 1 2 3 4 5 1 2 3 4 5
monitoring for
each water-related
CURRENT STATE CURRENT STATE
challenge as part of
the corporate’s
water strategy BOX 2 USING THE WATER RISK FILTER TO EVALUATE INITIAL WATER DEPENDENCIES AND IMPACTS
Figure 8:
WWF’s Water Risk Filter is an online tool that supports users to assess and identify responses to
Top right: Example address unique contextual water-related risks. To assess basin (external) water-related risks, the Water
of the possible visual Risk Filter uses the geographic location of a site to draw on 32, annually updated, peer reviewed data
output from an layers across three types of water-related risks, namely: physical, regulatory and reputational risks. As
evaluation to support such, it is possible to align the water-related challenge definitions with some of the Water Risk Filter’s
the decision as to
indicators (as illustrated below). This enables a corporation to draw on a credible data set, compiled
how much focus to
and updated by WWF, within a tool that is well regarded within the water stewardship community to
place on performance
monitoring of
complete the Current State, Dependency and Impact/Influence evaluation.
each water-related
challenge within the POSSIBLE WWF WATER RISK FILTER BASIN AND OPERATIONAL INDICATORS
ACME Corporation’s WATER-RELATED CURRENT STATE DEPENDENCIES IMPACT/INFLUENCE
water strategy CHALLENGE
EXTERNAL • Basin Regulatory • Regulatory scrutiny (O12) • Local brand recognition (O22)
GOVERNANCE Risk (BRG) • Planned Regulatory • Number of employees (O22)
changes (O13) • Stakeholder engagement level (R13)
WASH • Access to safe • Water Stewardship • Local brand recognition (O22)
drinking water (8.1) maturity (O21) • Number of employees (O22)
• Access to improved • Number of employees • Stakeholder engagement level (R13)
sanitation (8.2) (O28)
WATER • Quality (3) • Importance of water in • Total water discharged (O5)
QUALITY operations (O2) • Total wastewater discharged into
• Treatment requirements environment (O7)
before use (O8) • Ability to impact downstream quality (O11)
FRESHWATER • Ecosystem Service • Historical issues with • Total water withdrawn (O4)
BIODIVERSITY Status (4) water-related challenges • Total wastewater discharged into
(O3) environment (O7)
• Importance of water in • Ability to impact downstream quality (O11)
operations (O2)
• Quantity (Scarcity) (1) • Historical issues with • Total water withdrawn (O4)
WATER
shared water challenges
SCARCITY
(O3)
• Importance of water in
operations (O2)
• Estimated • Importance of this site to • Local brand recognition (O22)
FLOODING
Occurrences company (O23) • Number of employees (O22)
of Floods (2.1) • Historical issues with • Water Risk awareness level (R12)
water-related challenges
(O3)
• Projected change in • Importance of this site to • Local brand recognition (O22)
EXTREME
occurrences of company (O23) • Number of employees (O22)
WEATHER
droughts (1.6) • Climate change scenarios • Climate change scenarios and resiliency
EVENTS
• Projected change in and resiliency planning planning (R15)
occurrences of floods (R15)
(2.2)
CONTEXTUAL WATER TARGETS 16PART 2
STEP 2: STRUCTURE
Structure the contextual targets for each water-related challenge using levels,
components, and interim milestones to establish a suite of targets that can then be
contextually assigned to individual sites within the priority value chain “hot spots”
Once a corporation has identified how much water-related challenges of Water Scarcity and
emphasis to place on performance monitoring at WASH for ACME Corporation to enable it to
the sites it has prioritised in the value chain “hot structure a matrix of performance targets for the
spots” for water-related challenge as part of its water-related challenges, which can then be used
corporate-level water strategy, it then needs to to assign contextual targets to sites within the
begin to structure the forms of targets that it will prioritised “hot spots” of its value chain.
be setting. There are three dimensions that can
In the above example, ACME Corporation has
help a corporation structure a more contextually
chosen that the interim milestones for progress
appropriate performance for its targets, namely:
monitoring will be 2022, 2023 and 2024. These will
Level be defined and validated by the site in step 3.
A series of multiple levels that represent One of the questions that will inevitably come up
incrementally more ambitious performance, during the development of the overall structuring
which can be used to more meaningfully match of this matrix suite of contextual targets relates
target performance expectations to the unique to performance. Before discussing performance
context of sites further, it is important to again emphasise that a
contextual target lacks the quantificational precision
Components that allows a target setter to explicitly demonstrate
A collection of five components that can be used how its performance against a specific target
to construct more meaningful and consistent is benefiting other water users by contributing
targets (see Table 2) to a state of sustainable system balance (this is
Table 5:
the role of a water SBT). In other words, the key
Example of the levels (and
generally how these are
Interim milestones distinction between a contextual and water SBT
A series of defined points within the timeframe is that determination of the level of performance
framed) and the targets
(built using the component of the target that will be used to monitor progress of the target remains the discretion of the target
elements) that ACME towards the final level of performance (Step 3 setter (versus the basin outcome’s threshold needs).
Corporation has developed provides further guidance on this) However, adopting a contextual approach to water
for two of its water-related
An illustrative example (Table 5) shows how these performance does require some form of accounting
challenges – Water
Scarcity and WASH three dimensions could be combined for the for the current state of water-related challenges.
LEVEL 1 LEVEL 2 LEVEL 3
GOOD WATER MANAGEMENT FOUNDATIONAL WATER STEWARDSHIP ADVANCED WATER STEWARDSHIP
DESCRIPTION Good Water Management Foundational Water Stewardship Advanced Water Stewardship
AND PURPOSE OF Establish good water Establish operational practices Establish operational practices
LEVEL WATER management practices and/or and/or performance that are stretch- and/or performance that are high-
SCARCITY WASH performance that is at least ing and account for best practice. ly responsive to the local context
compliant with local regulations. and represent leading practice.
WATER SCARCITY By 2025 (Timeframe), achieve a By 2025, achieve a 30% reduction By 2025, achieve a 40% reduc-
20% (Measurement - Quantitative in site-level water abstraction based tion in site-level water abstraction
and Performance**) reduction on a 2020 baseline with greater em- based on a 2020 baseline and
(Objective - Outcome) in site-level phasis on reductions during water replenish 100% of the volume
(Scope – Site-level) water abstrac- scarce months of the year. of water the site uses each year
tion based on a 2020 baseline. locally at times and in places that
are ecologically meaningful.
WASH By 2023 (Timeframe), establish a By 2024, establish a WASH-related By 2025, establish a process that
process (Objective – Process) to training and awareness programme assesses the WASH needs of
manage WASH facilities for em- that is delivered to all workers on employees and their families at
ployees (Scope – Site level) that is site (not just employees) and is also home and uses this data to inform
compliant (Measurement - Qualita- part of all new employee orientation. an annual community WASH
tive) with local WASH regulations engagement plan.
(Performance**).
* Once a water SBT methodology is developed, this level could represent where a corporation sets SBTs for Quality and/or Water Scarcity ** More guidance on performance in Table
CONTEXTUAL WATER TARGETS 17PART 2
BOX 3 TEMPORAL AND SPATIAL VARIABILITY OF WATER
Water is temporally and spatially (i.e., localised) variable. The temporal variability is how the state of a
water-related challenge changes over time (e.g., hourly, monthly, or annually). For example, if the water
quality of a body of water into which a site discharges fluctuates across seasons, a corporation may
choose to ask a site to break an absolute annual water discharge target into seasonal targets with more
stringent discharge targets being set for seasons that have higher levels of water quality issues compared
to others. The spatial variability is how the state of a water-related challenge changes across a geographic
area. For example, two sites may be located near to one another but find themselves in different basins –
meaning a water-related challenge may manifest differently for each site despite their closeness.
A leading approach towards contextual performance should begin to account for finer temporal
(e.g., monthly, weekly, or daily) and spatial scales. While not critical as part of a contextual target,
corporations that are seeking to pursue a more science-based approach in the future may need to
© Jo-Anne McArthur / Unsplash
1
5
account for this in these targets and so starting to account for temporal and spatial scales now may
be beneficial in these circumstances. These temporal and spatial scales can be outlined generally at
1
5
a corporate-level with the expectation that each site would then use local insights to translate these
components of the target at the site-level.
2
Structure
that the situational context of each water-
related challenge for each site (i.e., the Current
2
2 State, Dependency, and Impact/Influence) is
accounted for when targets are assigned. This
can be done in many ways but the simplest
Evaluate 1 CORPORATE SITE 3 Validate
LEVEL
4 LEVEL would be to draw on the evaluation completed as
part of step 1 (see Table 4) to create a matrix that
Agree will use the combination of the numerical values
5 for Current State, Dependencies, and Impact/
3
Influence to assign the levels of performance
developed earlier in this step. Table 7 gives
3
A CONTEXTUAL There are two ways that a corporation can an example of how ACME Corporation has
TARGET LACKS THE start to consider what performance it will chosen to combine the numerical values from
assign to its targets. Firstly, the output of the the evaluations (Figure 8) and how it will
QUANTIFICATIONAL evaluation in step 1 (i.e., how much emphasis assign outputs of this to each of the levels that
PRECISION will be placed on the performance monitoring it has structured. It should be noted that what
THAT ALLOWS A of a water-related challenge within a business is presented in Table 7 is a simple example of
TARGET SETTER strategy) can be used to signal which water- how the numerical scales of Current State,
Dependencies and Impacts/Influence can
TO EXPLICITLY
related challenges will have more ambitious
performance levels applied to them. For example, be combined. It is not a specific method for
DEMONSTRATE HOW those water-related challenges that have come setting contextual targets and so corporations
ITS PERFORMANCE, out as being more strategically relevant should can tailor steps such as these to suit their
AGAINST A SPECIFIC generally demonstrate more ambition with unique situations. For example, rather than
TARGET, IS BENEFITING respect to the levels of performance that is set
– across all levels. Secondly, the levels used in
simply adding the numerical scales together, a
corporation could choose to apply weightings
OTHER WATER USERS the approach described above in structuring a to each factor to give one or more factors extra
BY CONTRIBUTING matrix of contextual targets, establish a natural prominence. If this is done, it is good practice to
TO A STATE OF pathway to build in incrementally higher levels of explain this pattern of decision-making within
SUSTAINABLE performance at each level for each water-related corporate material (e.g., a corporation specific
SYSTEM BALANCE challenge. In almost all cases, contextual target
performance will be either a first- or second-
methodology) to help stakeholders understand
the decision to weigh certain factors.
order level of performance (see Table 2). There
Constructing this matrix then allows the
are many ways in which a corporation could
corporation to assign contextual targets
define this level of performance and Table 6
for each water-related challenge to each site.
describes some common approaches along with
Table 8 gives an illustrated example for what
respective benefits and drawbacks.
the application of this matrix looks like for
Once a corporation has defined how it will one of the prioritised sites within the ACME
structure its contextual targets for each water- Corporation's value chain.
related challenge, it then needs to assign these
to sites. This is critical as it is through this step
CONTEXTUAL WATER TARGETS 18PART 2
Table 6:
Table outlining different
approaches that can be
used to determine the
level of performance for
contextual targets
APPROACH DESCRIPTION BENEFITS DRAWBACKS
BENCHMARKING Looking to others and/or leaders •A
llows for easier comparison • Not every business is the same in its
(either inside or outside a sector) between other peers and operations or where it operates and so
with the view to replicate or better leaders could be lacking context
their level of performance • Peers may not be accounting for local
water context and so will not reflect the
need of water-related challenges
• If peers are using non-contextual metrics,
then it could perpetuate incorrect metrics
(e.g., per unit efficiency)
REGULATIONS Use of local regulations for •A
llows easier demonstration • Regulations could be more conservative
determining the level of of local compliance and do not always reflect the need of
performance water-related challenges
• Regulations may be outdated
• Designed to be general rather than
sector specific
• May not be informed by best available
science
STANDARDS Use performance levels defined •A
llows for performance to • Not every business is the same in its
for a sector within sectoral best meet sectoral best practice operations or where it operates and so
practice standards could be lacking context
INTERNAL Use of continual improvement to • Usually easier to achieve • May not reflect the need of the water-
incrementally increase the level of •L ess upfront work to define related challenges
performance ambition performance
TECHNOLOGICAL Use the performance afforded by •U
sually, technology helps to • New technology can sometimes
new / best available technologies as improve processes and so it is need time before benefits are
the level of performance likely to lead to an enhanced conclusively proved
level of performance compared
to older technology
FRAMEWORKS Translating levels of performance • Alignment with frameworks • May not reflect the need of the water-
set out in global framework (e.g., that have greater global buy-in related challenges
SDGs) as the foundation for the • Easier to demonstrate • Not every business is the same in its
level of performance how performance could be operations or where it operates and so
contributing to global efforts could be lacking context
SCIENCE Use best available science to set •C
losest type of performance • May not have wider agreement on science
the level of performance of a target that a contextual approach can and so could be less credible
(but less rigorous than what is offer to answering the question • Science may be more stringent compared
required by a SBT methodology) around what nature needs to what a company could achieve
to establish a more ambitious
but contextual-relevant level of
performance
Table 7:
Table outlining how ACME FORMULA OUTPUT TRIGGERS
Corporation will combine
the numeric values from the FORMULA TO BE USED LEVEL 1 LEVEL 2 LEVEL 3
evaluation of Current State,
Dependencies and Impact/ CURRENT STATE + 0-5 6-9 10+
Influence and how the DEPENDENCIES +
output of this will be used IMPACT/INFLUENCE
to assign different levels of
contextual targets.
CONTEXTUAL WATER TARGETS 19You can also read
