The Cost of Glacier Melt: The Business Case for Fair Water Footprints

Across the globe, glaciers are shrinking faster than ever causing growing water risks facing communities and companies alike. In many regions, the meltwater from glaciers has long been a critical source of freshwater for local communities and businesses. As glaciers shrink and water shortages become increasingly frequent, companies that rely on this meltwater will face operational disruptions and growing costs. Our data shows that companies estimate more than US$2 billion on average in water-related risks stemming from glacial melt alone. 

The UN has designated 2025 the International Year of Glaciers' Preservation, which kicked off in March with World Water Day, highlighting the critical role glaciers play in regulating water resources, especially for the communities and businesses that rely on seasonal meltwater for their freshwater supply. For nearly 2 billion people globally, meltwater from glaciers has been an essential source of freshwater - critical for sustaining livelihoods, industry and healthy ecosystems.  

Growing water risks

Water risk is financial risk, and melting glaciers are just one of many water-related challenges facing the global economy as the climate and nature crises accelerate. Companies responding to CDP’s Water Security questionnaire in 2023 reported a potential financial impact of US $596 billion in water-related risks, over 5 times higher than the $100 billion cost of mitigating those risks.

This is simply unsustainable. We must fundamentally change the way water is used across the global economy – encouraging businesses to boost resilience, reduce their exposure to water risks and support sustainable growth.  

That's why CDP, as part of the Fair Water Footprints initiative – a partnership of national governments, the private sector and civil society – is working to transform how the global economy interacts with and values water.    

What is a Fair Water Footprint? 

A “water footprint” refers to the amount of water a company needs to create physical goods, measured across its entire supply chain. Currently, too many corporate water footprints are both unsustainable and unfair.

Many high-income countries rely on water sourced outside of their borders to produce their goods, often in countries already facing severe water insecurity. For example, the average household of four in the UK will typically consume six bathtubs of water each day directly in their homes, but they can consume as much as 77 bathtubs of water each day outside the UK through the food, clothes, and goods they purchase.

A Fair Water Footprint is a way of assessing water use that accounts for both environmental and social impacts, ensuring water security, reduced pollution and access to safe water and sanitation for all. Just as carbon footprints have become standard, mainstreaming fair water footprints will encourage more businesses to embed sustainable water practices in their operations and supply chains.

Resilience to drought and floods is one of the five Fair Water Footprint principles, alongside zero pollution, access to sanitation and hygiene for workers, protection of ecosystems and equitable and sustainable water withdrawals. Companies that are facing growing risks from glacier melt and other water risks, are already experiencing the direct impacts of a warming climate. Ensuring that their water footprints are fair will be essential for the long-term profitability and sustainability of their business. In an increasingly resource-constrained world, only companies that are environmentally and socially responsible will be positioned to thrive. 

How to take action

Companies can join the Fair Water Footprints initiative today to become part of a growing network that is shaping how water is governed, valued, and shared across the global economy.

The initiative equips companies and financial institutions with the tools to embed sustainable water practices across their businesses. As part of this, signatories are working together to identify hotspots for change — from stronger regulation and business incentives to trade reform and locally led solutions. For example, by fostering a dialogue between corporate buyers and their suppliers, the Fair Water Footprints initiative opens the door to improved products and innovative solutions that reduce water risks.

Disclosure and high-quality data are essential to building Fair Water Footprints. That’s why CDP’s integrated questionnaire is aligned with the Fair Water Footprints framework, making it easier for companies to measure, manage and reduce their water impacts. Nearly 25,000 companies already disclose environmental data through CDP and are using these insights to illuminate risks and unlock opportunities. 

As water risks accelerate, now is the time to act. Join the Fair Water Footprints initiative and disclose through CDP to start building a more resilient, water-secure future for your business.