Since its launch in 2010, CDP’s Water Security disclosure has grown from a pilot global initiative into one of the world’s leading corporate water reporting systems. What began as a relatively small group of early adopters has expanded steadily over the past decade, with participation expanding to thousands of companies globally. CDP has also maintained its reputation as an investor‑driven reporting system.
Water security has become a critical business priority because companies increasingly rely on consistent, good‑quality water across their operations and global supply chains—all while climate‑driven water scarcity, pollution, floods, and droughts are intensifying. These disruptions can halt production, increase costs, and expose businesses to material financial and regulatory risk.
Water challenges are further amplified by the rapid expansion of AI, as data centers and digital infrastructure are highly water‑intensive for cooling, making water availability a growing constraint on where and how AI technologies can be scaled sustainably. The issue of water security and availability has prompted investors and disclosure frameworks such as CDP and CSRD to expect stronger governance and transparency on water management.
Designed for investors, customers, and other stakeholders, the Water Security questionnaire covers core areas such as governance, water accounting, risk assessment, targets, and value‑chain engagement. Furthermore, CDP’s scoring framework rewards clear, consistent, and decision‑useful disclosure. The scope and robustness of the Water Security questionnaire have evolved. This article provides key disclosure requirements and best practices to help companies move beyond compliance toward credible, high‑quality water security reporting.
CDP Water Security topics
For 2026, CDP has not introduced new Essential Criteria for Water Security. Instead, changes to existing criteria are limited and intended to reflect questionnaire updates and improve consistency in assessment.
CDP’s Essential Criteria are a set of mandatory disclosure checks that companies must meet to achieve or maintain higher CDP scores, particularly at the Leadership (A/A‑List) level. They act as a baseline for what CDP considers non‑negotiable, decision‑useful information, ensuring that high‑scoring companies disclose a consistent core set of data.
The CDP Water Security Questionnaire is designed to assess how effectively organizations understand, manage, and act on water‑related risks, impacts, and opportunities across their operations and value chain. The key water security topics reflect CDP’s view of water stewardship as a progression from measurement and awareness to management, governance, and strategic action.
1. Water accounting (current state)
What CDP asks:
Water accounting involves the disclosure of quantitative water data, including withdrawals, discharges, consumption, and water sourced from areas of water stress, often over multiple reporting years.
Why it matters:
Robust water accounting is the foundation of water security management. CDP emphasizes measurement because companies cannot manage or reduce impacts they do not quantify, and investors rely on consistent metrics to assess exposure and performance.
Updates in 2026:
- Core water accounting metrics remain stable, but CDP has emphasized greater consistency with GRI 303 (Water and Effluents) and clearer guidance on interpretation.
- For the SME questionnaire, water security metrics are expanded, signaling stronger expectation for entry‑level water data disclosure even among smaller companies.
2. Business impacts
What CDP asks:
Companies report actual water‑related impacts experienced during the reporting period, such as production disruptions, increased costs, regulatory penalties, or reputational damage.
Why it matters:
Reporting realized impacts demonstrates that water risk is not theoretical. It provides decision‑useful insight into how water issues are already affecting financial performance and operational resilience. Furthermore, CDP is increasingly interested in whether companies can connect past impacts to forward‑looking risk management rather than reporting impacts in isolation.
Updates in 2026:
- No new impact categories are added, but CDP has broadened questions across themes to better capture physical impacts linked to adaptation and resilience.
- Companies are expected to be clearer about how realized water impacts relate to broader environmental risk preparedness.
3. Policies, procedures, and risk management processes
What CDP asks:
Companies must disclose of internal procedures to identify, assess, and manage water‑related dependencies, impacts, risks, and opportunities, including frequency, tools used, and decision‑making integration.
Why it matters:
Strong procedures indicate that water risk management is embedded in core business processes rather than treated as a one‑off exercise. Companies with static or purely corporate‑level risk procedures may find it harder to demonstrate readiness for evolving water risks. CDP rewards structured, repeatable processes over ad‑hoc assessments.
Updates in 2026:
- Existing questions now more explicitly seek evidence of structured, repeatable processes that account for changing physical conditions, such as climate‑driven water stress. This reflects CDP’s cross‑cutting expansion of adaptation and resilience disclosures, rather than introducing separate water‑only questions.
4. Water‑related risks and opportunities
What CDP asks:
Risk and opportunities disclosure entail the identification of substantive water‑related risks and opportunities, including physical, regulatory, and reputational dimensions, with information on time horizons, potential impacts, and response strategies.
Why it matters:
Investors use this information to evaluate how exposed a company is to future water‑related disruptions and whether management responses are proportionate. CDP places particular emphasis on location‑specific and basin‑level risk assessment.
Updates in 2026:
- Water risk and opportunity questions are refined to better align with science‑based approaches, including Science‑Based Targets for Nature (SBTN) concepts where relevant.
- CDP signals increased expectations for decision‑useful risk narratives, including clearer time horizons and management responses, though scoring criteria themselves are unchanged.
5. Water pollutant management procedures
What CDP asks:
CDP asks companies to disclose whether they have formal procedures to manage water pollution and hazardous substances, including how they identify, monitor, and control pollutant discharges and assess pollution risks at corporate and site levels.
Why it matters:
CDP treats pollution as a core water‑related risk, as poor management of hazardous substances can trigger regulatory action, operational disruption, and financial penalties. By requiring disclosure of pollution management procedures early, CDP enables stakeholders to assess whether companies have the governance and controls needed to prevent future water quality impacts, not just respond after incidents.
Updates in 2026:
- The water pollutant management questions now ask for outcome-focused data on how companies measure the success of their pollutant management process. New information requested includes evidence of effectiveness of pollutant management procedures and how success is tracked. Organizations that do not identify and classify water pollutants will be prompted to provide an explanation.
6. Facility‑level and priority location data
What CDP asks:
For companies exposed to substantive water-related risks, CDP requests site‑ or facility‑level water data, especially in water‑stressed or high‑risk locations.
Why it matters:
Water risk is inherently local. Facility‑level disclosure allows data users to assess whether corporate‑level strategies are aligned with on‑the‑ground exposure and supports more credible risk analysis. This improves efficiency while maintaining CDP’s emphasis on local water risk where it is material.
Updates in 2026:
- Facility‑level disclosure remains targeted and conditional, but clearer questionnaire design helps direct high‑risk companies to site‑specific questions more consistently.
7. Governance and oversight on water issues
What CDP asks:
Companies are requested to provide information on board‑level oversight, senior management responsibility, and accountability mechanisms for water‑related issues.
Why it matters:
Strong governance signals that water is treated as a strategic business issue. CDP and investors view board oversight as a key indicator of long‑term risk management and organizational maturity.
Updates in 2026:
- Governance questions are largely unchanged, but CDP’s broader framing now more explicitly links board oversight to resilience and preparedness for physical environmental risks, including water.
8. Business strategy integration
What CDP asks:
CDP assesses how water‑related risks and opportunities influence business strategy, capital allocation, product development, and long‑term planning.
Why it matters:
This topic connects water management to financial decision‑making. CDP emphasizes strategic integration to assess whether companies are building resilience rather than merely reporting metrics.
Updates in 2026:
- CDP expands expectations around how water risks and dependencies are reflected in strategic planning and capital allocation, and as part of its wider nature and resilience narrative.
- There are no new water‑specific strategy questions, but improved guidance clarifies what CDP considers meaningful integration.
9. Water targets and performance tracking
What CDP asks:
CDP reviews companies’ water‑related targets, including reduction goals, efficiency improvements, and context‑based or basin‑informed targets, alongside progress against those targets.
Why it matters:
Targets demonstrate intent and ambition, while performance tracking shows execution. CDP encourages targets that reflect local water conditions rather than generic efficiency goals.
Updates in 2026:
- Stronger conceptual alignment with SBTN is signaled for Water Security, though setting science‑based water targets is not newly mandated. For water targets that have been set according to the SBTN freshwater methodologies and validated by the Accountability Accelerator, CDP would consider these to reflect best practice.
10. Value chain engagement
What CDP asks:
Companies must report on their water‑related engagement with suppliers, customers, and other value‑chain partners, including risk identification beyond direct operations.
Why it matters:
CDP recognizes that the largest water impacts often occur in the supply chain. Value chain disclosure helps investors assess systemic exposure and the company’s ability to influence water stewardship beyond its own sites.
Updates in 2026:
- There is no structural change to value‑chain questions, but CDP reiterates that nature‑related risk often sits outside direct operations, reinforcing expectations for supplier engagement. Companies that previously limited disclosure to direct operations may need to strengthen narrative depth on supply‑chain water risk.
- This aligns with broader TNFD‑related framing referenced by CDP for 2026.
Preparing for the next phase of CDP Plastics reporting
The CDP Plastics module was introduced and housed within the Water Security questionnaire when it was first launched in 2023. The module (specifically then Module W10) was added to the Water Security questionnaire to address the direct threats plastic pollution poses to water systems, aquatic environments, and water security.
From 2025 onward, CDP’s Plastics is now separate from Water Security. Disclosure for Plastics remains unscored, alongside Biodiversity and Oceans, reflecting CDP’s recognition that many companies are still developing the data systems needed to fully understand their plastics footprint.
While responses do not directly affect CDP letter scores, plastics data is increasingly reviewed by investors, customers, and value‑chain partners as part of broader assessments of environmental risk, transition readiness, and corporate credibility.
In practice, CDP continues to expand and refine plastics questions rather than introduce abrupt structural changes. From 2025 into 2026, updates focus on clearer definitions, improved guidance and better conditional logic, particularly around plastic packaging, reuse models, and end‑of‑life management. These refinements are intended to improve comparability across disclosures and reduce ambiguity, helping companies report more consistently across products, packaging, and value‑chain activities.
CDP is also strengthening alignment with established global plastics frameworks, including the Ellen MacArthur Foundation Global Commitment, GRI 306 on waste, WWF ReSource Tracker, and TNFD.
Introducing CDP’s new Oceans module in 2026
For the first time in 2026, CDP has introduced a dedicated Oceans module within its corporate questionnaire. This new module enables companies to disclose their dependencies on, impacts to, and risks and opportunities related to ocean ecosystems, reflecting growing investor and policy attention on marine environments. The addition of oceans expands CDP’s scope beyond climate, water, and forests, reinforcing its transition toward a more integrated nature‑related disclosure framework.
In its initial year, the Oceans module is unscored and optional, giving organizations time to understand their marine‑related impacts and begin building relevant data systems without immediate scoring implications. CDP has positioned this phase as a data‑building and learning period, particularly for companies with direct or indirect links to marine ecosystems, such as shipping, fisheries, offshore energy, tourism, and coastal infrastructure. This mirrors CDP’s earlier approach to plastics disclosure, where data maturity was prioritized before performance assessment.
The Oceans module responds to increasing recognition that ocean health is economically and environmentally material, with risks linked to biodiversity loss, pollution, climate change, and regulatory intervention. By requesting standardized ocean‑related data, CDP aims to close a major transparency gap for investors and other stakeholders and align corporate reporting more closely with emerging global frameworks, including TNFD‑related thinking on nature dependencies and impacts. While CDP has not announced when oceans will become scored, the structured introduction of this module signals a clear long‑term direction toward greater accountability for marine impacts.
Evolving CDP Water disclosure expectations
From 2025 onward, CDP’s Water Security disclosure remains structurally stable, but expectations around quality and substance continue to rise. CDP increasingly differentiates reporting performance based on the depth, coherence, and decision‑usefulness of disclosures rather than completeness of responses.
In practice, CDP is placing greater emphasis on how companies prepare for and respond to physical water risks such as scarcity, flooding, drought, and pollution. Beyond identifying risks, responders are expected to demonstrate how water‑related risks influence operational planning, capital investment, and long‑term strategy. Generic, corporate‑level narratives are becoming less effective, particularly at higher scoring levels, as CDP continues to reward location‑specific and basin‑level risk assessment that reflects local water conditions and future risk trajectories.
CDP is also signaling clearer expectations around credible action. While science‑based targets for freshwater under the Science‑Based Targets Network are not mandatory, they are increasingly recognized as emerging best practice, particularly where targets reflect basin context rather than generic efficiency improvements. At the same time, pollution and wastewater management remain core Water Security topics for high‑impact sectors, with growing attention on whether controls are robust, site‑specific, and forward‑looking rather than purely compliance‑driven.
On CDP’s approach from 2025 into 2026 for responders, the main risk is not missing a new question but failing to keep pace with rising expectations around consistency and strategic integration. Companies that invest in reliable water data, location‑specific risk analysis, credible targets, and clear links to resilience and business strategy will be best positioned as CDP continues its gradual shift from disclosure toward demonstrated water stewardship.
For over 30 years, ADEC ESG has worked with global organizations to improve their ESG programs and reporting. As a CDP Silver Climate Change Consultancy in the U.S. and Japan, we’re trusted by CDP and by our clients to provide specialized support for CDP disclosure development. In 2025, 98% of our CDP clients achieved Management B or higher. Learn more about our CDP-related services.
This blog provides general information and does not constitute the rendering of legal, economic, business, or other professional services or advice. Consult with your advisors regarding the applicability of this content to your specific circumstances.
