Which practice is a key approach to managing water risk?

• A. Expanding production without water controls.
• B. Ignoring supplier water risk.
• C. Water stewardship, efficiency, watershed protection, and supplier engagement.
• D. Focusing solely on energy efficiency.

Answer: (C)

Managing water risk requires a comprehensive, proactive strategy across operations and the supply chain. This approach combines using water efficiently to reduce demand, protecting the watershed and surrounding water resources to ensure a stable supply and healthy ecosystems, and engaging suppliers so water risks are managed throughout the value chain. Together, these elements create resilience against droughts, regulatory changes, and community concerns, while safeguarding long-term access to water.

Expanding production without water controls can heighten risk by increasing demand without addressing supply or quality. Ignoring supplier water risk leaves upstream vulnerabilities unresolved. Focusing only on energy efficiency misses the critical water dimension that affects operations and community relationships.