Diageo boss warns on Scottish water scarcity By Reuters

By Richa Naidu and Jessica DiNapoli

LONDON (Reuters) -Diageo PLC’s Chief Government Ivan Menezes believes Scotland may face a water scarcity because of local weather change until companies and lawmakers act, he stated on the Reuters Affect convention on Monday.

The risk in Scotland, the place Diageo (LON:) is the largest exporter of Scotch whisky by way of manufacturers like Johnnie Walker, is dependent upon how profitable the world is at averting local weather change and hitting a 1.5-degree Celsius restrict on international warming, he stated.

“There are eventualities the place we may see water being pressured in Scotland,” Menezes stated.

Diageo’s beer enterprise manufacturing Guinness stout consumes extra water than spirits, he added.

Menezes stated that a part of his compensation is tied to Diageo hitting particular environmental objectives together with on water conservation.

Diageo additionally makes Don Julio tequila, Smirnoff Vodka and Baileys liqueur.

Individually, Menezes stated that Diageo is “not immune” to inflationary strain and hovering vitality prices however “needs to be OK” if Europe faces vitality blackouts as quickly as tomorrow.

Russia’s conflict on Ukraine has pushed vitality costs to document highs, hitting Europe notably exhausting due to its dependence on Russian gasoline.

“We needs to be well-covered,” he stated.

Diageo sees water conservation and environmental efforts as “actually core to the long-term well being of the enterprise,” Menezes stated.

“We’re a client enterprise so it can translate into client choice over time,” Menezes stated. “We have now a powerful conviction about that.”

The corporate is replenishing water in pressured areas it operates in, together with in India by 2024.

The spirits business has managed to keep away from taking successful from an ongoing cost-of-living disaster in Europe. Diageo not too long ago reported robust gross sales of its costliest merchandise.

The corporate stated throughout its earnings name in July that its merchandise had been promoting as a result of individuals think about them an occasional indulgence, whilst excessive inflation stoked by Russia’s conflict with Ukraine exhibits no indicators of abating.