Private companies are increasingly reporting water as a material risk to their businesses. These risks — such as water scarcity, floods and droughts, which are increasing due to climate change and growing water demand — can raise operational costs, disrupt operations, damage brands or heighten regulatory uncertainty. Material risks threaten not only businesses themselves, but also the people who rely on them for employment and services.

Companies need to understand their risk levels and conduct water stewardship projects that reduce water risks. But understanding how much water a company uses and where it’s sourced from is complicated. WRI worked with Procter & Gamble (P&G) and partners to assess the company’s water use, uncover its sources, understand specific water-related business risks, and identify regions and basins that are impacted the most.

Challenges of Mapping Water Boundaries

Water can’t be mapped the same way as a local city, county or state because the water used by the residents and businesses of those locations crosses traditional borders. Instead, water is mapped via watersheds, also called drainage basins or catchments. Watersheds are areas of land that drain (or shed) water from rainfall and snowmelt into a receiving body of water (also called an outflow point), according to the National Oceanic and Atmospheric Administration.  The outflow point is where all flowing surface water converges into a single place like a river mouth, bay, lake or ocean.

Watershed boundaries are relative to the use case — and vary in size based on how they are defined. Someone may refer to their local watershed as the area around a small tributary that drains into the Mississippi River and others may refer to their local watershed as the entire Mississippi River watershed — one that includes thousands of square miles and encompasses many other smaller watersheds. The Mississippi watershed is the largest in the U.S. and drains 1.15 million square miles (roughly the size of India) across 31 states and two Canadian provinces.

Subbasins of the Mississippi (HydroBASINS 6)

To provide uniform, comparable data, global models and datasets, including WRI's Aqueduct data platform, aggregate water risk data into basins defined by the HydroBASINS dataset. This dataset, used in several other water-related tools and databases, depicts watershed boundaries and subbasin delineations at a global scale and offers 12 levels of basin sizes — some very small like the tributary’s basin that drains into the Mississippi, and some the size of the Mississippi's watershed. Aqueduct uses HydroBASINS level 6 to denote subbasins because it is small enough to capture meaningful local variations and large enough to minimize the non-natural effect of water transfers, like canals or water trucks (“inter-basin transfer”), not included in the model that Aqueduct uses.

Local and Global

Global models show companies where water risks occur and help them prioritize where to focus water stewardship efforts. While they are great first-level screening tools to identify water risks and prioritize regions, discrepancies can arise between global data and local, on-the-ground realities. For example, global models, like HydroSHEDS classify all basins around the world at a similar area for each level. They can be smaller or larger than local water management authorities’ definitions, based on country size, basin importance, scale or source data. The resulting boundaries can span the jurisdictions of multiple water managers — too large for effective water stewardship work. In addition, to ensure data clarity, HydroBASINS are named with six-digit codes that are not universally recognized, and although Aqueduct reports basin names as defined by the Food and Agriculture Organization of the United Nations (FAO), they don’t perfectly match the HydroBASINS scale which means global modelers and local authorities may classify basins with different names. 

While these challenges can complicate water stewardship, it is important to use both global and local data to inform this work. Once companies prioritize locations with global models, they should also use local datasets and models to dive deeper into priority sites and work on water stewardship.

Water stewardship projects — like rechanneling a creek to restore native habitat, installing blue-green roofs to reduce stormwater runoff or detecting leaks in residential toilets — are meant to benefit the watershed where that company is withdrawing water, affecting water quality or otherwise impacting the basin. It’s critical for watershed boundaries to be clear and the same boundaries must be used by all stakeholders (e.g., companies, water managers, NGOs) operating within or impacting a watershed. If stakeholders use different maps for the watersheds they work in, this can have detrimental impacts for water stewardship projects and collective action in a particular basin.

Identifying the Right Locations for Water Stewardship Projects

Using Aqueduct, WRI and P&G assessed water risks across P&G facilities and consumer markets. The data highlighted basins based on water-stressed and high-priority markets where the company has a physical presence, where over 20% of the population faces high or extremely high average annual water stress, and where at least one high water-risk facility is located.  This resulted in 18 priority basins across seven countries.

To transition from global prioritization to local water stewardship projects, P&G developed a basin discovery report for each location, with help from Bonneville Environmental Foundation (BEF), the University of Cincinnati and ERM, to better understand local definitions of basin boundaries, local nomenclature, source watersheds, shared water challenges and existing efforts to address those challenges for these 18 basins. This information helped P&G to: 

  1. Confirm that the HydroSHEDS boundaries and FAO names were identical at the local scale.
  2. Suggest changes to the original boundaries based on results from local research.
  3. Identify the source watersheds that provide water to local communities or their facilities.

Now, P&G can more confidently identify and support water restoration projects to improve, better manage, or protect freshwater resources used or impacted by their facilities or consumers.



In Spain, P&G used Aqueduct data to identify the Segura Basin as a priority basin surrounding their facility.

They then completed a basin discovery report for the Segura Basin and learned that the water authorities defined it using different boundaries than those used by Aqueduct. The local definition of the Segura Basin boundaries did not include the P&G facility location.

Instead, it was discovered that the Jucar Basin and its locally defined boundaries was the basin that contained the P&G site.

Without looking at the local definitions for the basin boundaries, P&G would have risked supporting water restoration projects that were not linked to the facility’s actual water source. It would have also caused confusion when local implementers searched for projects because they would not be familiar with the global basin boundaries and name used by Aqueduct.

Los Angeles

One of P&G’s facilities in California is located just outside of Los Angeles. Using Aqueduct, a large watershed reaching almost as far northwest as Santa Maria (about 70 miles northwest of Santa Barbara), was identified as the priority basin. In addition to restoring the water consumed at the site, P&G also committed to restoring the water consumed during the use of its products in the basin.

They embarked on further research to confirm the boundaries for intervention and discovered that the basin boundaries and name should be modified based on the local definition of the state’s basins.

Once the new boundaries and names were identified, the next step was to learn more about where the water for the priority basin came from.

The basin discovery report revealed that much of the water used by both the facility and by P&G consumers living in the metropolitan Los Angeles area originates from several different source watersheds outside of the priority basin boundaries.

In 2022, over 70% of the water sourced to the Los Angeles area came from the Sacramento River/Feather River basins via the State Water Project and from the Colorado River Basin via the Colorado River aqueduct. 15% came from the Owens River Basin via the Los Angeles aqueduct.

With this more holistic understanding of the basin boundaries and source watersheds, P&G was able to search for related projects in areas relevant to their water consumption. Today, P&G is supporting projects within the local basin boundaries (South Coast basin), Sacramento River basin and the Colorado River basin.

Other companies can replicate this to identify where to implement water stewardship projects. Here are three ways to advance local understanding and engagement:

1) Refine Basins Based on Local Information

Country-level environmental agencies, regional basin authorities, national or local utilities or local universities may have studies, reports and/or maps available that can help companies confirm the boundaries and names of the basins they operate in. These resources can also show where water originates from a prioritized basin.

2) Contribute to the HydroBASINS Updates 

WRI Aqueduct uses HydroBASINS 6 basin data, which is currently undergoing a major update. The new version will have higher resolution elevation data to refine boundaries and river networks. Adding locally recognized names to these basins would greatly improve understanding and support collective action.

3) Collective Action: Partner with Local Basin Management and Local Actors

Though companies use global models to prioritize and set goals, water stewardship projects must be locally led. This helps to ensure buy-in long after the initial project ends. Partnering with local basin management authorities sets water stewardship projects up for success.  In addition, companies should work together and engage in collective action, like the Water Fund of São Paulo that brought more than 1,500 people together to improve the watershed. Rather than working alone, locally led projects and collective action can expand benefits.