Could Contaminated Water Dull Perrier’s Sparkle?

Bloomberg Audio Studios, podcasts, radio news. Perier conjures a certain image those green pear shaped glass bottles with that golden cap. For more than a century, the brand of French mineral water has built up a reputation.

The Champagne of table waters is how they like to frame it.

Bloomberg's Dasha Afanasiva covers European consumer goods companies, including Nesle, which owns Perier.

It's the kind of thing that you can find in the most expensive hotels all over the world. I was just in India and all the fancy hotels had these tiny bottles of Perier. So it's really retained this prestige in the elite status as far as mineral watersk.

But today Perier is facing several challenges. There's heightened scrutiny, problems posed by climate change, and fallout from an investigation by French regulators that could ding its image.

From the previous year. But it was leaked in April. Says that there's fecal matter, there's forever chemicals, and there's pesticides, and that includes pesticides that it was sort of ban two decades ago.

Regulators only found trace amounts of these pollutants, But Dasha says the report and other issues facing the brand put it at a tricky crossroads.

So it's a really bad look. And there was never a suggestion that the waters were unsafe to drink. It's more a question of what do you produce and what do you tell consumers about what it is that you're selling them.

I'm David Gura and this is the big take from Bloomberg News today on the show, how pollutants ended up in a well used by one of the world's best known brands of bottled water and Perier's reputation survived, And is its broader business sustainable enough to weather other storms? What is it that makes Perrier water Perrier water? What is it about it that makes it stand out?

So it's very much about where it is sourced and the sources in the south of France in this very quite rural area. There's not too much going on.

That it's just outside of Rugez, a town in southern France, not too far from the Mediterranean, with a few thousand residents.

It's just quite sleepy and quiet. And the idea is that it allows this water to be sourced from really Christine sources. It's supposed to be completely unspoilt.

Dasha says. Perrier keeps the exact location of each well secret, but the water has been a draw for thousands of years.

Since fifty eight BC, you know, that's when the Romans first built a bath, and then in the nineteenth century Napoleon signed a decree for this water to be exploited and for there to be a spa on the site. English nobility come and visit and stay in the spa and drink this water to sort of rejuvenate. It was a wellness fad back in the nineteenth century, and eventually someone called Sir John Harmsworth bought this site and started

To this day, all Perrier water must come from that same sought after source. And because it's sold as natural mineral water, that's what it says on the label, it's also subject to strict regulation.

It can do some basic, very basic filtering, but it pretty much has to come to the consumer. The actual water as you found it. You can carbonate it, but you're not supposed to disinfect the water in any way, because really, what's the point of having this this heritage water, all of these mineral properties if you're going to then boil it.

So how did contaminants make it into Perrie's water. The company says it has to do with the weather.

They blamed it on torrential rain that had disturbed the balance of the different pools of water underground.

Perrier pumps its water from an aquifer more than five hundred feet below the earth's surface, where it's already been naturally filtered and protected from contaminants. That can affect pools that aren't as deep. But Dasha says, intense rain can saturate the local water system and that can cause different pools to mix.

A shallow one can come into contact with a much deeper one which has been protected by clay and rock, so you're getting your water from the deeper one, but actually it's got shallow water mixed in and that can cause contamination.

And this isn't the first time Perrier has run into a contamination problem.

Nineteen ninety, which is before Nessa even owned Perie. There are traces of benzene found in the water and benzines, a carcinogen, and the company was forced to or chose to do one of the biggest recalls in the world as one hundred and sixty million bottles one hundred and twenty countries, and that really created a massive hit to its reputation.

Decades later, Nesley was accused of using illegal filtration methods like activated charcoal and UV filtering in Perier's production process. Both steps are against the rules for anything labeled as natural mineral water in France. The company settled the case, but it was still a big hit to Perier's image.

So it got sued by Consumer Watchdog and there was another lawsuit where it's had to pay a fine two million eurofine, but it didn't actually admit wrong doing in that and food watch is suing again because this consumer group thinks they shouldn't have been let off the hook.

This issue has not gone away. Perier faces similar allegations in other countries.

So they kind of really have to watch out for the reputational damage of that. I don't think typically the fines are very big, you know, two million euros is a very much atol for such a massive company, But it's being in the headlines for misleading consumers that's potentially really damaging. You know, you need trust when you're asking people to eat drink your stuff.

Neslie Waters France declined to comment on the lawsuit, but reaffirmed that the safety and quality of Perrier have always been guaranteed that all its brands now comply with French rules. The company told Bloomberg quote, we have invested significantly and will continue to do so to protect this unique heritage and ensure its future.

They had a new boss come in twenty twenty and she was told, oh, we've been doing this filtering. So then she started a modernization plan, a multie plan which costs one hundred and fifty million euros, and that included sort of re cleaning all of the pipes and having a system for doing that so that contaminants don't get in.

But Dasha says revamping the production process is only part of the solution.

It also has a whole program to reduce pesticide use in the area, so it allows wine makers to make wine on its land so long as they do it organically.

Nesley is encouraging more environmentally friendly farming practices near Perier's source. But France has been one of the world's biggest users of pesticides and the country is still struggling to deal with the legacy of that.

Arguably, there's not an awful lot Nessley can do about it. But I guess the issue is does a mineral water still have integrity when we've been using pesticides for so long.

The other big challenge for Perrier it fights to keep its product and its image intact a rapidly changing climate. That's after the break. Bloomberg's Dasha Afanasieva has been reporting on Perier, the French luxury bottled water brand, and the challenges it faces, from recent scandals to increased scrutiny. Another big one is climate change.

So in this region there's many more droughts and also instances of torrential rain that are impacting Perie. So with the droughts, it's obvious you know you're running out of water, and if you can't kind of take water out when there's not enough for other uses.

It's the same problem the company pointed to as a reason for contamination from pesticides and fecal matter torrential rain.

If that happens more and more often, then even if you're testing loads, you can catch that and you can prevent that water going to market. But it will. An essay admits that it does, actually it will in the future. Course fluctuation. In its fluctuations and its production.

Levels, Perrier has turned to other strategies to keep consumers interested and to grow the brand. Earlier this year, it introduced a new sparkling water called Maison Perier. Its ad campaign is fronted by Emily and Paris actor Lily Collins. The water comes from the same source in France, but it's not branded as a natural mineral water, so it's not subject to the same stringent regulations.

So they're not going to run into problems with filtering when they're not really allowed to with their drink. And they're hoping that that's going to be forty percent of Perrier revenue. So that's great because there's all this water that they wouldn't have had a useful that they can

Perier also sells water in plastic bottles, which Daja says raises other concerns.

Nassi's solution is having fifty percent recycle content by twenty twenty five, and which again there are issues with that because you know, plastic leaches into water, and the more you recycle it, the greater the risks that even more

Neslie says, it's doing everything it can to shrink its environmental footprint. It's pushing for more bottle return programs and reducing its use of non recycled plastics. Dasha, with all of these issues surrounding Perier, right now, where does this leave its parent company Nesley?

I mean, look, water isn't a huge chunk of nesle revenue. It's I think it's about three and a half percent. So this isn't a situation where, you know, Neslei's biggest business is under threat at all. But it's more a question of has this company been run effectively? Is it biting off more than it can chew? Are its operations not as smooth as they could be? So it raises

This is the big take from Bloomberg News. I'm David Gera. This episode was produced by David Fox. It was edited by Aaron Edwards and Alyssa MacDonald. It was mixed by Alex Segura. It was fact checked by Adriana Tapia. Our senior producer is Naomi Shaven. Our senior editor is Elizabeth Ponso. Our executive producer is Nicole Beemster. Bor Sage Bauman is Bloomberg's head of podcasts. If you liked this episode, make sure to subscribe and review The Big Take wherever you