Missed Opportunities

This project is a great starting point to escalate conservation actions in key watersheds. The challenge remains to be how to perform such escalation. We need additional resources to sell the project to other companies to invest in the same objectives.

Project Narrative

Around the world, the availability of sufficient clean water is one of our most pressing—and fastest growing—resource challenges. The wellbeing of communities, ecosystems and businesses are integrally linked to the sustainable management of our freshwater resources. Delivering clean and reliable water may be the single largest challenge that our growing cities face. In Latin America, nearly 80 percent of people live in cities making it one of the most urbanized regions of the world. Over the next 15 years, this urban population will grow from 260 to 315 million. All these cities need clean, reliable water supplies to thrive. However, many drinking water sources are severely degraded. In the face of the twin challenges of growing demand and climate change, it has never been more urgent to protect and restore the lands where our water comes from. A long-term solution to ensure water provision to major cities in Latin America requires the implementation of a multi-stakeholder strategy that can address watershed protection in a collective manner. TNC believes that collective action that includes the private and public sectors, as well as civil society, can activate a structural mid-term solution to the hydric balance equation, such that different actors would engage in the responsible use of water, whilst recognizing that nature solutions can provide economically attractive returns to society and improve water security at the same time. Working with public and private organizations, TNC is developing financial tools that gather investments from water users and direct the funding toward conservation of key lands upstream that filter and regulate water supply. At the same time, habitat for native plants and wildlife is preserved. For almost two decades, The Nature Conservancy has been working to implement and refine water funds as a collective action mechanism, to secure freshwater for people living downstream in urban centers through investments in upstream activities directed towards conserving or restoring watershed headwaters. Because of their intrinsic flexibility, water funds are well-suited for global replication, which sets the stage for their application in a broad range of geographies and political contexts. In 2000, TNC pioneered its first Water Fund in Quito, Ecuador to protect and restore grasslands and forests high in the Andes, improving river flows and reducing erosion to secure water availability for downstream city residents and other water users. Over the years, this mechanism has succeeded in engaging key public and private partners to support the double benefit of improving water security (availability, quality, etc.), while preserving and restoring vulnerable habitats. water funds are organizations that design and enhance financial and governance mechanisms that unite public, private and civil society stakeholders, around a common goal to contribute to water security and sustainable watershed management through nature-based solutions. In 2011, the Latin America Water Funds Partnership (LAWFP) was created with an agreement between the Inter-American Development Bank (IADB), FEMSA Foundation, the Global Environment Facility (GEF), and The Nature Conservancy (TNC) to contribute to water security in Latin America and the Caribbean, through the creation and strengthening of water funds. The LAWFP has been collaborating with different stakeholders in the region to promote Water Security and has been successfully working with the Coca Cola System in promoting water funds in different countries, as well as implementing nature-based activities, reducing water risks and delivering replenishment benefits. Currently, TNC has supported the creation of 23 water funds in Latin America and has more than 20 additional water funds in feasibility and design phases. The Nature Conservancy believes that water funds are the ideal mechanism to implement replenishment projects. By implementing replenishment projects in coordination with water funds it is possible to: • Link replenishment projects to a water security vision of the watershed; • Collaborate in a collective action mechanism that will scale-up on-the-ground interventions; • Provide long-term sustainability to on-the-ground implementations after the project ends. TNC has successfully led the implementation of replenishment projects in Latin America, the U.S. and Africa. In Latin America and Africa, TNC has been working on initiatives that link replenishment projects with water funds, resulting in relevant projects that can solve water security issues, engage in collective action, and that will have long-term sustainability. In Latin America, TNC is managing the “Water for the Future” project in collaboration with the Coca Cola Latin Center Business Unit. In 2013, Coca Cola Latin Center Business Unit and bottlers Arca Continental, BEPENSA and Coca Cola FEMSA joined the Latin America Water Funds Partnership in a project to promote and finance watershed conservation in Latin America (currently 6 countries: Ecuador, Colombia, Panamá, Costa Rica, Guatemala and the Dominican Republic). The results of this project so far are: - 5.1 million m³ of water replenished - 4,800 hectares conserved - 10 water funds strengthened - 100% replenishment achieved in all countries TNC draws from previous successful experiences to present this new proposal to Coca Cola’s South Latin Business Unit, to contribute to the achievement of the water replenishment goals established for Argentina, Chile, Peru and Uruguay, as well as to contribute to the process of advancing key water funds and generating large-scale results in these countries. These contributions will allow Coca Cola to work with TNC in developing conservation activities and projects, that in addition to advancing Coca Cola´s replenishment goals, have the potential to: • benefit nature while providing people with water security; • use science-based analysis to ensure that money is invested in places that provide the greatest replenishment; • bring together water users and local communities for mutual benefit; • reduce transaction costs through the leveraging of partnerships, compared to a model of implementing activities on a project-by-project basis throughout South Latin countries. Specifically, this proposal outlines an intended partnership between Coca Cola’s South Latin Business Unit and TNC, to contribute towards water security collaboratively by investing in watershed management activities and the development of collective action mechanisms in the source watersheds of four cities (Santiago, Mendoza, Lima and Montevideo). An initial partnership proposal of one year with a contribution from Coca Cola of $800,000 will achieve the following: I. Support the development and strengthening of four water funds (Mendoza, Santiago, Lima and Montevideo) as a means of upholding Coca Cola’s water leadership, facilitating engagement with key partners and policy makers, in order to ensure the sustainability of the watersheds where the water funds operate. II. Implement watershed management interventions (replenishment activities) in strategic locations in source watersheds for Mendoza, Santiago, Lima and Montevideo. The interventions will serve as examples of the type of activities that the water fund can implement to reduce water risks and improve water security within a watershed.