Guide to Water-Related Collective Action. CEO Water Mandate Mumbai Working Session March 7, 2012

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1 Guide to Water-Related Collective Action CEO Water Mandate Mumbai Working Session March 7, 2012

2 Guide to Water-Related Collective Action 2 Societal Risks by Severity and Likelihood Source: World Economic Forum 2012

3 Guide to Water-Related Collective Action 3 Risk and Control Impact on Company Direct operations Supplier operations Watershed conditions Company Influence Direct operations Supplier operations Watershed conditions

4 Success Guide to Water-Related Collective Action 4 From Challenge to Systematic, Sustainable Outcome Exit collective action as risk reduces through achieving collective action objectives and/or institutionalization of external capacity & interest Evaluate CA need and Determine appropriate CA process Initiate Collective Action Build Capacity & Interest Time

5 Guide to Water-Related Collective Action 5 Background Collective Action Guide Initiated March 2012 Collaboration Among CEO Water Mandate Water Futures Partnership Pacific Institute (rep. Mandate Secretariat) Pegasys Strategy and Development Ross Strategic Official Release at Stockholm WWW 2012 Beta Version 1.0

6 Guide to Water-Related Collective Action 6

7 Guide to Water-Related Collective Action 7 Case Example Contributors AB-InBev Finlays Horticulture Molson Coors Brewing Company Sasol New Energy Anglo American SABMiller SEAAWA Nike, Levi, H&M, Nautica Suez Environment The Coca-Cola Company

8 Guide to Water-Related Collective Action 8 Why a Collective Action Guide? Collective action when effective: Fresh ideas and perspectives Credibility and legitimacy Momentum for change Resources to address common objectives Resilient solutions Collective action challenges: Non-conventional relationships, non-traditional partners Complex needs, interests, personalities, organizational structures Public scrutiny, unrealistic expectations, skepticism about motives CEO Water Mandate Guide to Water-Related Collective Action Optimize collective effort, common objectives, shared outcomes Minimize risk of inefficient process, miscommunication, poor outcomes

9 Guide to Water-Related Collective Action 9 Positioning Collective Action Coordinated engagement among interested parties in support of common objectives Emphasis on joint, two-way dialog produces stronger outcomes than unilateral action Range of forms Informal information exchange and consultation to Structured joint decision making, implementation, and accountability Effective collective action tailored needs, objectives, conditions, and capabilities

10 Guide to Water-Related Collective Action 10 Scope and Purpose Companies new to external engagement Internal scoping of collective action needs/options Prepare company to initiate external party discussions Assist in unpacking the balance between: Motivation for engagement in multi-party collaborative efforts as the backbone of SWM progress Requirements for effective collective action = ability and willingness to embrace joint interests, shared goals, and common objectives Two companion efforts: Water Action Hub Water Futures Partnership Compendium of Lessons Learned

11 Guide to Water-Related Collective Action 11 Collective Action Guide: Overview Section 1: Introduction Section 2: Scope and Purpose of the Collective Action Guide Section 3: Understanding Water-Related Collective Action Section 4: Preparing for Collective Action Section 5: Structuring and Managing Collective Action Appendices: Resources Structured Analysis Frameworks

12 Guide to Water-Related Collective Action 12 Understanding Water-Related Collective Action: Driver and Motivations Risk & Stewardship Managing operational pressures resulting from inadequate availability, supply, or quality Maintaining/enhancing legal/social license to operate by demonstrating responsible resource management Assuring investors and other stakeholders water risks adequately addressed Uphold corporate values and commitments related to sustainable development Collective action desirable/necessary when unilateral action will not produce these outcomes

13 Guide to Water-Related Collective Action 13 Water Management Domains and Degree of Control Catchments with Supplier Operations Catchments with Company Operations Supplier Operations Optimize Water Use Minimize Water Resource Impacts Company Operations Optimize Water Use Minimize Water Resource Impacts WATER MANAGEMENT INTERDEPENDENCE High Direct Control Medium to Low Direct Control Indirect Control

14 Guide to Water-Related Collective Action 14 Understanding Water-Related Collective Action Public sector primary responsibility for sustainable water management Public sector may suffer from: Inadequate financial resources Insufficient institutional capacity Inappropriate governance mechanisms Water-related challenges can arise and escalate Collective action responds to these deficiencies Engagement tied to local/catchment-level outcomes

15 Guide to Water-Related Collective Action 15 Benefits of Collective Action Clear articulation of problems, shared ownership of solutions, clarity of joint purpose More informed decision making by the business initiator and other parties to the engagement Broader scope and depth of motivation and momentum in support of water-related improvements An expanded pool of expertise, capacity, or financial resources focused on fostering change More durable outcomes that are supported by the engaged parties Establishment and maintenance of credibility and legitimacy with critical interested parties Stronger water governance by engaging multiple stakeholders, including all water users

16 Guide to Water-Related Collective Action 16 Collective Action Preparation Internal analysis and dialog to understand: water challenges action areas, interested parties, and engagement options. Create solid footing for initiating external discussions and collective action implementation Possibility of partner as guide to approaching collective action considering capacity, networks, reputation, and mandate

17 Guide to Water-Related Collective Action 17 Collective Action Preparation and Implementation ELEMENT 1: Articulating Water-Related Challenges and Action Areas (Section 4.1) ELEMENT 2: Characterizing the Interested Party Landscape (Section 4.2) ELEMENT 3: Selecting a Collective Action Level of Engagement (Section 4.3) ELEMENT 4: Preparing for Collective Action (Section 4.4) ELEMENT 5: Implementation, Refinement and Evolution (Section 5)

18 Guide to Water-Related Collective Action 18 Discussion Segment One Linking Water Resources Management Challenges and Collective Action

19 Guide to Water-Related Collective Action 19 Water Resource Management Cycle Catchment Water Resource Water Infrastructure System Upstream Water Resources Water Supply and Treatment Catchment Ecosystems Water Governance & Management Company, Supplier, and Community Water Uses Receiving Water Resources Waste Water and Stormwater Treatment and Discharge

20 Guide to Water-Related Collective Action 20 Characterizing Water-Related Challenges, Causes, and Risks Drivers of Water Resource State Water Management System Water-Related Challenges Company Interests Economic Development Demographic Shifts Changes to quality, quantity, or availability; alterations to goals or objectives Infrastructure Management and Funding Water Governance and Regulation Insufficient response to water management pressures and requirements Water Over- Allocation Water Supply/Sanitation Unreliable/ Unavailable Water Quality Deterioration Direct operational impacts or concerned community actors or customers Physical Risk Regulatory Risk Climate Variability Water Planning, Management, and Pricing Flood Damage Reputational Risk Social Norms and Expectations Ecosystem Degradation Stewardship Opportunity

21 Guide to Water-Related Collective Action 21 Potential Collective Action Areas from the Water Action Hub n Efficient Water Use Effluent Management, Wastewater Reclamation, Reuse Community-Level Access to Safe Water, Sanitation, and Hygiene Storm Water Management and Flood Control Infrastructure Finance, Development, Operation, or Maintenance Sustainable Agriculture Climate Change Adaptation and Resilience Ecosystem, Source Water Protection, Restoration Monitoring and Knowledge Sharing Engaging in Participatory Platforms Public Awareness and Education Improved Water Governance, Policy Development, and Implementation

22 Guide to Water-Related Collective Action 22 From Challenge to Action IMMEDIATE WATER CHALLENGE Water Quality Deterioration: Sedimentation WATER MANAGEMENT SYSTEM DEFICIENCY Water Governance and Regulation: Regulation of land management practice requirements to prevent sedimentation lacking DRIVER OF WATER RESOURCE STATE Economic Development: Expansion of basin agricultural activity ACTION AREA A: Sustainable Agriculture ACTION AREA B: Improved Water Governance and Policy Development ACTION AREA C: Engaging in Participatory Platforms ACTION AREA D: Public Awareness and Education

23 Guide to Water-Related Collective Action 23 Scoping Water-Related Challenges and Explore three questions: Action Areas 1. What are your priority water-related challenges in the catchment of concern? 2. What socioeconomic drivers and underlying deficiencies in the water system lead to the challenges? 3. Which type of interventions (action areas) will best address the problems you have identified?

24 Guide to Water-Related Collective Action 24 Discussion Segment Two Engaging on Water: With Whom, on What Topic

25 Guide to Water-Related Collective Action 25 Understanding Prospective External Party Participants Many potential interests, organizations, individuals Those sharing the water resource Community-based organizations Producer co-operatives Governmental water managers NGOs with water or community-related missions Donors and aid agencies Infrastructure managers Research institutions Analysis to identify critical, legitimate, and relevant interested parties

26 Guide to Water-Related Collective Action 26 Identifying Critical Participants Six Point Analysis Decision Point Opportunity Expertise Impacts Expectations Conflict

27 Guide to Water-Related Collective Action 27 Identifying & Characterizing Prospective Participants Explore three questions: 1. Who has what type of interest in your challenges and planned action areas? 2. Who can best help address your challenges? 3. Who needs to be part of the solution(s) that will address your challenges?

28 Guide to Water-Related Collective Action 28 Discussion Segment Three Scoping the Collective Action Level(s) of Engagement

29 Guide to Water-Related Collective Action 29 Understanding Collective Action Levels of Engagement Four levels of engagement: 1. Sharing information (informative) 2. Seeking advice (consultative) 3. Pursuing common objectives (collaborative) 4. Integrating decisions, resources, actions (integrative)

30 Guide to Water-Related Collective Action 30 Understanding Collective Action Distinct choices: Levels of Engagement (2) Resource requirements Desire/need for common purpose and consensus Expectations for joint, coordinated action Expectations for responsiveness Less demanding levels may meet objectives Less demanding levels often precede more demanding ones

31 Guide to Water-Related Collective Action 31 Collective Action Levels and Associated Requirements Collective Action Process Resource Requirements Desire/Need for Common Purpose and Consensus Expectation for Coordinated Action Expectations for Company Responsiveness Informative Low Not Needed Not Expected Low Consultative Moderate Low Low or Not Expected Low Collaborative Moderate to High Moderate to High Moderate to High Moderate to High Integrative High High High High

32 Guide to Water-Related Collective Action 32 Selecting the Level of Engagement Three factors: 1. External party dependence 2. External party interest/capacity 3. Internal company interest/capacity High dependence points to high engagement levels Interest or capacity may constrain, at least nearterm, options

33 Dependency LOW HIGH External Interest /Capacity Requirement Guide to Water-Related Collective Action 33 Mapping Dependency, Interest, and Capacity Outcomes to Collective Action Engagement Levels Integrative Collaborative Reserve Capacity/ Interest Consultative Informative Reserve Interest/ Capacity Internal Interest/Capacity Requirement

34 Guide to Water-Related Collective Action 34 Collective Action Levels and Associated Requirements What degree of dependence on external parties does success in your action have? What is the degree of external party interest and capacity to participate in a collective action related to your action area? What is the degree of internal organizational interest and capacity to participate in a collective action related to your area?

35 Guide to Water-Related Collective Action 35 Discussion Segment Four Designing and Implementing Collective Action

36 Guide to Water-Related Collective Action 36 Designing the Collective Action Engagement Articulating collective action objectives, intervention type, and outcomes Establishing core roles and general participation Roles: initiator, convener, process manager, neutral party, experts, funders General Participation: effective, complete representation of interests Addressing Interest and Capacity deficiencies External: Clarity for shared risk, responsibility, benefits External: Capacity for effective representation Internal: State of credibility and trust Internal: Capacity to be responsive to other interests

37 Guide to Water-Related Collective Action 37 Structuring and Managing Collective Action External, iterative engagement to produce: Products (scope of work, process charter, etc.) Understanding, trust, credibility among participants Four effective collective action principles Create clarity Support interaction and responsiveness Establish transparency and accountability Build in ability to adapt

38 Guide to Water-Related Collective Action 38 Structuring and Managing Collective Action Six effective collective action structural elements Degree of formality Decision-making approach Commitments and responsibility boundaries Time frame Legal, regulatory, and policy factors Closure expectations

39 Guide to Water-Related Collective Action 39 Wrap Up Moving to Action; Next Steps

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