SUSTAINABILITY REPORT 2023
Supplement to the integrated annual report for the year ended 30 September 2023
Supplement to the integrated annual report for the year ended 30 September 2023
Our interactions with water span multiple stages of our supply chain. During agriculture, water is essential for irrigation, while fertilisers and pesticides pose potential pollution risks. In our manufacturing and processing phase, water is heavily used in plants that produce "wet products", and without proper treatment, wastewater can lead to pollution. While water is not directly consumed during packaging production and distribution, these stages indirectly contribute to water use and potential pollution, such as through the production of packaging materials and refrigerant leaks. Furthermore, consumer use of our products involves water, but pollution at this stage depends largely on local water treatment capabilities. Finally, improper disposal of our product and packaging waste at the end of their life cycle could lead to water pollution.
Water scarcity is ubiquitous where we operate in South Africa, and approximately 74% of our facilities are in water-stressed catchments. Water security presents a strategic risk for our operations, closely linked to climate change, and compounded by infrastructure collapse in some of the municipal areas where our manufacturing facilities are located. This year, regular disruptions in water supply as a result of infrastructure failure has been a key contextual challenge for our manufacturing sites. We have had to procure water tankers to deliver water to our sites at higher cost.
Our approach to water management is informed by compliance requirements, particularly the National Water Act and municipal by-laws that set freshwater allocations and effluent discharge permits and limits. The implications of climate change and water stress for our operations are quickly becoming a key factor in our approach and initiatives, especially as we are starting to unpack these issues and the strategic risks they pose to our business more thoroughly ( see – risk management).
We have a high-level understanding of the implications of water-stress for our operations, and are working on developing a truer sense of our risk exposure and the status of the infrastructure challenges we face. We are underway with a scientific study to deepen our understanding, supported Professor Anthony Turton at the Centre for Environmental Management at the University of Free State. The study seeks to shed light on our water balance and water risk outlook, factoring in water-stress, infrastructure collapse, and climate change. We completed catchment risk mapping in 2022, and focused on infrastructure risk and climate change in 2023.
Management
We conduct an annual goal-setting process at the start of each financial year, based on our 2030 goals, and informed by current performance and planned initiatives. Our 2030 target is to achieve a 30% reduction in water intensity (kℓ/tonne) from a 2019 baseline, and our annual target for 2023 was to achieve a 6% reduction in water intensity for the group.
We have improved water management procedures across many of our sites, in line with our SSHE management systems and procedures, and informed by our 2022 "deep dive" into our environmental performance (see above, and – SSHE). Yet, there is much still to accomplish before we get to the level of proficiency required to scale our efforts more strategically. We face a number of challenges at some sites, training and consistency being key, and some of our sites have regressed in their performance.
We routinely track water usage at site level, and there is opportunity to further improve the consistency of daily water measurement at our plants. Monitoring and reporting of onsite water-use includes daily measurement across all sites to enable a rapid response to any anomalies, weekly reporting, and monthly progress and performance reviews. Much of this is currently done manually. We are actively identifying and implementing water-use reduction initiatives across our sites, driven by our process optimisation department. Our water-use intensity is highest at our S&T, Chococam, Baby, LAF, Boksburg and Musina sites. The installation of water meters remains both a key goal and a significant internal challenge.
Our effluent is tested by accredited labs in accordance with the South African National Standards (SANS). Our manufacturing plants are legally required to have a permit to discharge effluent, with regulations stipulating higher public water treatment levies for lower-quality effluent discharged. We are currently paying higher levies than we would like, and are looking to address effluent quality more directly in future. Improving the quality of our effluent by building onsite water treatment capacity would incur significant capital costs, but would decrease the burden on already overwrought public water treatment systems, as well as open up opportunities for water recycling and reuse within our plants. Navigating this trade-off and undertaking a cost-benefit analysis of potential solutions is something we need to investigate further.
Key progress made on effluent management this year included on-site quality monitoring of key parameters at S&T (Jacobs), internal tracking of electrical conductivity, installation of a pH correction system at the Baby plant in Cape Town along with effluent drain construction, and improved odour control at the Musina effluent treatment system's treatment dams. We also constructed a final effluent balancing sump at the Beverages plant (Roodekop) to homogenise treated effluent prior to discharge. Our Paarl factory reached compliance in 2022 but requires further improvement, while Ashton remains non-compliant. An effluent treatment upgrade project has been included in the capital expenditure budget for the current financial year and is planned for execution at Ashton.
Performance
In 2023, our total freshwater withdrawal from all areas was 3 474 348kℓ, including tanker water trucked to site as a result of municipal water supply challenges. We recorded a 2% decrease in total water consumption from the previous year, and a 1,9% decrease in freshwater consumption intensity (kℓ/tonne). We did not achieve our annual target for reducing water use intensity in line with our 2030 target.
| Total water consumption (kℓ) | 2023 | 2022 | 2023 | 2020 |
| 3 474 348 | 3 544 841 | 3 863 743 | 3 791 666 |
