Sustainable Water Resources Management

The Company efficiently manages water resources to reduce risks and impacts from water scarcity. Additionally, the Company promotes the ecosystem existence and systematically monitors the water management risks of suppliers. This includes tracking the sources and quantities of agricultural products from Critical Tier 1 suppliers located in water stressed areas, among others.

Risks and Opportunities

Climate change is increasingly affecting global water availability, leading to more frequent and severe droughts, floods, saltwater intrusion, and water scarcity in many regions. Efficient water conservation to address changing climate patterns is a critical management issue to ensure the efficient use and equitable distribution of this precious resource.

CP ALL recognizes the importance of effective water management. Water is a fundamental resource essential for both business operations and human life. A lack of effective water management can not only impact operations and disrupt the supply chain but also damage the company’s reputation and pose risks of violating human rights to water and sanitation. Conflicts between the company and surrounding communities may arise as a result.

Management Approach

To achieve sustainable water management and minimize environmental impacts from our operations, CP All has established environmental policies and water stewardship practices. These ensure our business operations balance water usage with the needs of communities and nature. We have set an ambitious long-term target to reduce water consumption per revenue by 20% by 2030 compared to the 2020 baseline. Additionally, we assess water-related risks and opportunities, develop plans to mitigate water scarcity, and implement measures to improve water efficiency and conservation. We promote effective water management throughout our organization, support the adoption of water recycling technologies, and raise awareness among employees and stakeholders about water conservation through training, knowledge sharing, and campaigns. We also collaborate with communities and stakeholders to address water-related challenges at the national level and disclose our water performance annually in our sustainability reports.

Sustainable Water Use Assessment

CP ALL continuously collects, monitors, reviews, and analyzes data on water consumption and quality across all operational areas, including manufacturing facilities, distribution centers, 7-Eleven stores, Makro and Lotus sales centers, and offices. Assessments are conducted quarterly using three primary methods: 1) For manufacturing, and distribution facilities, water risk assessments are conducted according to ISO 14001:2015 standards. In 2023, CP Ram’s facilities in Ladlumkaew, Boen, Ladkrabang, Chonburi, Surat Thani, Khon Kaen, and Lamphun were ISO 14001:2015 certified. 2) For facilities located in industrial estates, wastewater treatment and water efficiency are assessed by the Industrial Estate Authority of Thailand (IEAT) or independent third-party auditors according to international standards such as ISO 14001:2015, industry-specific standards, and estate-specific standards. 3) For sales centers and offices not located in industrial estates, our central greenhouse gas management unit assesses water management practices to identify opportunities for improvement and reduce impacts on water resources and ecosystems.

Water Consumption in 2023

Exposure of Suppliers to Water Risks

Additionally, the company conducts annual water stress risk assessments for all its operational areas and those of its Critical Tier 1 suppliers. These assessments identify risks associated with water scarcity, water overconsumption, and declining water quality. To accurately pinpoint operational areas located in water-stressed regions, the company utilizes the open-source Aqueduct Water Risk Atlas developed by the World Resources Institute (WRI). By inputting location data into the tool, CP ALL can precisely identify water stress areas, providing critical data for planning and decision-making. This information is used to develop mitigation measures and Business Continuity Plans (BCP) to prepare for unforeseen events. Furthermore, the assessments allow the company to quantify the overall impact of water risks on its operations.

In 2023, the Aqueduct Water Risk Atlas assessment revealed that 39.62% of the company’s operational areas are located in extremely high water stress regions, while 29.57% of its Critical Tier 1 suppliers’ operational areas fall into the same category.

Additionally, CP ALL continuously monitors and assesses the water stress situation of its Critical Tier 1 suppliers to prevent and mitigate supply chain disruptions. This is achieved through regular water stress risk assessments of agricultural sourcing areas for key agricultural products such as cattle product, maize, palm oil, rice, soybeans, sugar, tobacco, and cotton. By inputting the locations of Critical Tier 1 suppliers’ production facilities into the Aqueduct Water Risk Atlas, the company can identify high-risk areas for water stress among its suppliers.

definitions of water-stressed areas as follows:
Extremely High (>80%) Risk areas, as mapped by WRI’s Aqueduct Global Water Tool

In 2023,The analysis revealed that 22 Critical Tier 1 suppliers, primarily involved in cattle product, rice, soybeans, and sugar, were located in extremely high water-stress areas. The primary sourcing regions for these products were Nakhon Pathom, Saraburi, Nakhon Sawan, Lopburi, Prachin Buri and Pathum Thani provinces. In the previous fiscal year, the total cost of goods purchased from suppliers located in water-stressed areas accounted for 27.24% of the overall agricultural product cost.

Risk Assessment Summary

Supplier Water Risk Management

CP ALL has collaborated with its Critical Tier 1 suppliers located in water-stressed areas, as well as relevant government agencies and communities, to develop plans to mitigate risks related to water quantity and quality, regulatory changes or pricing structures, and stakeholder conflicts. These initiatives have been implemented through the following measures:

1. Risks related to the quantity and quality of water

To mitigate risks related to water quantity and quality, CP All has implemented the following measures:

2. Risks related to regulatory changes or changes in pricing structures

To mitigate the risk of regulatory changes or price structure changes that could affect production costs, profits, and the competitiveness of both CP All and its partners that may arise from commodities provided by Critical Tier 1 suppliers in water-stressed areas, the following measures have been implemented:

3. Risks related to stakeholder conflicts

To mitigate risks related to stakeholder conflicts, CP ALL has implemented the following measures:

Raising Awareness and Campaigning for employee

CP ALL is conducting a comprehensive communication campaign to raise awareness among all employees at every level, including operational, distribution, and office staff, about the importance of water efficiency. To encourage employees to be mindful of water conservation and actively participate in preserving water resources, the company is promoting the 7S campaign, with a 2023 focus on “S for Environment,” emphasizing the conservation of natural resources through the 3R principle. Employees are encouraged to utilize resources efficiently and effectively by reducing energy and water consumption.

The campaign aims to raise awareness and foster behavioral changes among employees at all levels. Not only does it help reduce organizational costs, but it also demonstrates our commitment to social responsibility and environmental sustainability. Additionally, it contributes to a positive corporate culture and improved workplace efficiency.

Water Conservation Program

The Company adopts sustainable water management practices for continuous business operations, such as efficient water management and the recycling of wastewater for reuse. These practices help reduce wastewater discharge into public and natural water sources through various projects, as follows: