Central and Eastern European (CEE) businesses face a significant water problem, with just 23% having assessed water risks in their supply chains. This exposes a major blind spot in corporate risk management, as water is becoming a costly business risk in the region.
More than half (52%) of companies surveyed have experienced at least one significant negative water-related impact in the past five years, including operational disruptions and rising costs. The outlook offers little comfort, with 58% expecting water risks to affect their business moderately or significantly over the next five years.
Water Risks in CEE Businesses
Research from WWF and EY denkstatt Austria, titled Business Water Risks and Readiness in Central and Eastern Europe, highlights findings from a survey of 115 firms in Bulgaria, Czechia, Hungary, Romania, Slovakia, and Ukraine. Some 46% have assessed water risks in their own operations, but just 23% have done so across their supply chains.
The most pressing concerns for companies in the region are drought and water shortages (cited by 49% of respondents), with flooding and heavy rainfall also ranking highly (46%). Additional worries include deteriorating water quality, ecosystem strain, and regulatory instability. Andreas Beckmann, CEO of WWF Central and Eastern Europe, points out that companies rely heavily on the stability of local rivers, wetlands, and freshwater ecosystems.
Consequences of Water Scarcity
This report comes after a summer marked by dangerously low Danube water levels, demonstrating how swiftly water shortages can paralyze economic activity. In 2026 alone, reduced river flows disrupted shipping and travel, while power plants in Hungary and Romania scaled back or halted operations due to insufficient cooling water.
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Willibald Kaltenbrunner, Managing Partner at EY denkstatt Austria, argues that businesses addressing water risks proactively will safeguard their operations, fortify their supply chains, and make better investment choices. Beyond risk avoidance, he notes that identifying vulnerabilities can reveal efficiency gains, stronger collaborations, and opportunities to maintain long-term competitiveness.
Assessing Water Risks
A similar gap emerges in assessing their impacts on water resources: 48% have examined impacts from direct operations, compared with just 25% across their supply chains. Given that water-related threats don’t respect corporate boundaries, this oversight could leave businesses exposed to cascading disruptions.
Despite widespread exposure to water-related risks, nearly half of respondents (45%) expect their water-related spending to remain unchanged over the next three years. Only 28% plan to increase it, including just 4% anticipating a significant rise. The adoption of a water strategy appears to be associated with greater willingness to invest.
Among companies that have experienced negative water-related impacts, 52 of those with a water strategy consider increasing their water investment in the next five years, compared with only 26 of those without one. The report calls for clear accountability, targets that reflect local water conditions, and closer engagement with suppliers and other water users.
Investing in Water Management
Recognising water risks is only the first step. Companies need to assess where water scarcity, flooding or declining water quality could disrupt operations, threaten supply chains, or increase costs.
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