Ceres used a systematic method for evaluating and scoring the water risk management practices of the 38 companies assessed. The methodology for each of the four editions of this report (2015, 2017, 2019, and 2021) is grounded in the Ceres Aqua Gauge. Since the 2019 report, there have been important changes made to the indicators, guidance, and scoring to ensure that the scores more accurately reflect the strength of companies’ water risk management and align with global standards, such as the SASB Standards and CDP, and research over the past decade. 

The Aqua Gauge was developed by Ceres, the World Business Council for Sustainable Development (WBCSD), IRRC Institute, and Ibaris to aid investors in evaluating the water management activities of corporations in a range of sectors against detailed definitions of leading practices. For the purposes of the Feeding Ourselves Thirsty analysis, these definitions were modified to enhance their relevance to the unique water use characteristics of the food sector. In 2020, Ceres and the Meridian Institute collaborated to conduct an analysis of some of the factors associated with U.S. row crop production and water quality outcomes. Ceres has used this research, along with lessons learned from previous iterations of Feeding Ourselves Thirsty and insight from global standards, to refine the indicators in 2021. 

Ceres partnered with Sustainalytics, a leading sustainability and data analytics consulting firm, to complete this analysis. In addition to advising on refining the methodology, Sustainalytics, in close coordination with Ceres, led the data collection process, conducted initial and final scoring of companies, and synthesized the findings. During the analysis, Ceres systematically reviewed company scores across each indicator, oversaw vertical reviews, and developed the final report.

How Companies Were Selected

The 38 companies evaluated in this report fall within the food products and beverage industries, as defined by the Global Industry Classification System (GICS). A majority of the companies selected are among the largest Agricultural Products, Beverage, Meat and Packaged Food firms listed in either the Standard & Poor’s 500 Index and/or in the Russell 1000 indices as of July 2014, prior to the release of the first Feeding Ourselves Thirsty analysis. In addition, there are several large companies that are either listed on different indices or are privately held that were included in the analysis to provide a more comprehensive company universe for benchmarking. 

All of the changes to the company universe between the 2019 and 2021 editions resulted from mergers and acquisitions or bankruptcies. 

When publicly available disclosures were integrated due to a merger before the data collection began, the companies were evaluated as one entity. For the 2021 edition, this method applied to Keurig Green Mountain and Dr. Pepper Snapple Group, now known as Keurig Dr Pepper. 

In addition to the above changes to the company universe, Dean Foods went bankrupt in 2019 and was removed from the analysis. 

Data Sources

Only existing publically available corporate disclosures were used for each assessment. Ceres did not survey or solicit disclosures from companies. Company disclosures made available after June 15, 2021 were not factored into this assessment. 

The following documents were reviewed:

  • Voluntary corporate disclosures, such as sustainability or corporate social responsibility (CSR) reports, supplier policies, press releases, and company websites
  • Company responses to CDP’s 2019 and 2020 water and climate change questionnaires
  • Mandatory financial disclosures, such as 10-K filings, annual reports, and proxy statements


Data Collection Process and Quality Control

There were multiple rounds of data collection and review between May and July 2021. Sustainalytics conducted the first level of the data collection and scoring between May and July 2021, which was followed by a detailed evaluation of company assessments and scores by Ceres. Quality control was embedded into the data collection process, with multiple reviewers evaluating data sources and scores during each round of data collection. After conducting reviews of each company assessment, Ceres and Sustainalytics reviewed data by sub-indicator to ensure that companies and industries were evaluated and scored consistently within each sub-indicator. Before finalizing scores, Sustainalytics conducted a final review of disclosures released before June 15, 2021 to ensure relevant disclosures were included in the assessment.  

Indicators and Weights

Company scores are based on 12 indicators and 36 sub-indicators that fall within four water management categories: Governance and Management, Water Risk Assessment, Target Setting, and Implementation Support. 

One hundred points are allocated among the sub-indicators and summed to determine total indicator scores, total water management category scores, and total overall company scores.

There have been important changes made to the indicators, guidance, and scoring since the 2019 report. These changes were made to ensure that scores more accurately reflect the strength of companies’ water risk management and align with global standards, such as SASB Standards and CDP. Several key changes to the indicators are as follows:

  • Increasing the weight applied to water management efforts related to the agricultural supply chain, which contains the bulk of the food sector’s exposure to water risk. This resulted in the deprioritization of several indicators related to companies' direct operations and manufacturing supply chain and led to the restructuring of the four water management categories. 
  • Time-bound sustainable-sourcing goals (sub-indicator 10.2 in 2019 and 3.3 in 2021) are a critical way for companies to respond to water risks in their agricultural supply chains. In order to emphasize the importance of this sub-indicator and more effectively evaluate corporate sustainable-sourcing goals, Ceres increased the total point value from eight to 20 points and developed a five-part criteria weighing commodity breadth, commodity depth, the impact-orientation of the goal, and whether the goal is quantified and time-bound. “Employs Metrics-based platforms and standards” (formerly 10.3 from the 2019 analysis) was also embedded into the new scoring structure of 3.3.
  • Additionally, in 2021, Feeding Ourselves Thirsty included indicator 3.2 to assess companies' targets to reduce water use across their agricultural supply chain.
  • Given the importance of comprehensive risk analysis processes and disclosure, the 2021 risk assessment indicators are more rigorous and do not focus simply on whether companies have conducted a water risk assessment. Companies are scored based on their inclusion of water quality in their risk assessments, if they disclose the amount and percentage of water withdrawn and consumed from high-risk regions (a SASB standard), if they disclose the percentage of agricultural products sourced from high-risk regions (a SASB standard), and if companies disclose their high-risk watersheds based on water quality and availability.
  • To ensure that companies’ efforts to mitigate water risks are sufficiently tailored to local needs, in 2021, Feeding Ourselves Thirsty analyzed a number of corporate practices and whether they were risk differentiated. Companies that establish more rigorous goals, supplier expectations, and implementation support in high risk watersheds were awarded higher scores in this analysis.