Experts from environmental consultancy ADAS said the plans could help to tackle diffuse pollution at the source.
Speaking at the Water Concerns conference, organised by ADAS, experts from the water industry said many traditional end-of-pipe treatments for pollution are no longer sustainable or cost-effective.
Diffuse water pollution costs the industry an estimated £250m a year.
'In addition to the water quality challenges this presents to the water companies, diffuse pollutants can have an impact on the ecological, aesthetic and economic aspects of water resources,' said Dr Chris Fawcett, technical services manager at ADAS.
Chris Ryder, head of water quality at Defra, said that water companies are now facing an additional challenge of reducing greenhouse gas emissions from end-of-pipe treatments as outlined in Defra's Future Water strategy.
Delegates heard that the key to tackling diffuse water pollution at its source will be to work with farming industry, as agriculture contributes 70% of the nitrates found in water.
'End-of-pipe solutions can be ineffective around key events such as [crop] spraying periods, as pollution may exceed treatment capacity said Dr Paul Fogg, principal research scientist at ADAS.
'Furthermore, the pesticide Metaldehyde, which has been found in catchments across the country, cannot be treated with traditional methods.
'In comparison there are relatively simple mitigation methods which can be employed by farmers to help prevent pollutants from entering the water system.'
However, Claire Pollard, principal inspector at the Drinking Water Inspectorate, and Kevin Ridout, deputy head of environment and water quality at Ofwat, admitted that relatively few catchment management proposals had been submitted in water companies' draft business plans ahead of the 2008 price review (PR09).