Physical water resource constraints make companies more susceptible to reputational risks. Declines in water availability and quality can increase competition for clean water. In water-scarce regions, tensions can arise between businesses and local communities, particularly in developing countries where local populations often lack access to safe and reliable drinking water. Community opposition to industrial water withdrawals and perceived or real inequities in use can emerge quickly and affect businesses profoundly. Local conflicts can damage brand image, or, in rare instances, even result in the loss of companies’ license to operate. In Kerala, India, for example, both PepsiCo and Coca-Cola’s bottlers.
