The Carbon Disclosure Project
October 2011: With carbon levels steadily rising (we are now at 389 ppm, rapidly moving away from the safe limit of 350 ppm), global warming needs to be tackled on all fronts. That is what the Carbon Disclosure Project (CDP) is doing. An independent, not-for-profit organisation based in the United Kingdom, it works with shareholders and corporations to disclose the greenhouse gas emissions of major corporations. Three thousand organisations from across the world’s major economies measure and disclose their greenhouse gas emissions, water use and climate change strategies through CDP.
Photograph by Supriya Biswas.
This data is made available for use by a wide audience including institutional investors, corporations, policymakers and their advisors, public sector organisations, government bodies, academics and the public. These groups can in turn use this information to encourage companies to set reduction targets and make performance improvements.
The only global climate change reporting system, CDP understands that climate change does not have national boundaries. It has harmonised its climate change data from organisations around the world and focusses on developing international carbon reporting standards.
CDP conducts several programmes to achieve their goals. The Investor CDP programme gathers information on the risks and opportunities of climate change from the world’s largest companies on behalf of 551 institutional investor signatories with a combined $71 trillion in assets under management. CDP then provides this information to its 551 institutional investor signatories, as well as distributing it throughout the global market place to increase transparency around climate-related investment risk and commercial opportunity, and drive investments towards a low carbon economy. The potential of such a project is outstanding – if large companies such as the ones targeted by CDP were to drastically reduce their carbon emissions the impact on global carbon levels would be immense.
BRINGING GOVERNMENTS INTO THE FOLD
The CDP Public Procurement initiative is a particularly interesting one. Governments are the biggest spenders in the world – their costs run into trillions of dollars each year and as such, their procurement practices have a dramatic impact on the market. If the government were to select their suppliers bearing in mind their carbon footprint, it would have a dramatic effect on emissions. As the organisation sums it up: CDP Public Procurement is a proven way for national and local governments to ask their suppliers direct questions about energy use, greenhouse gas emissions and the risks they face in a warming planet. Using a standardised process, members of the programme are able to better understand climate change related risk and work towards building a resilient, low carbon government supply chain.
The CDP Supply Chain programme is an extension of their government programme but applied to corporates. It aims to tackle emissions from activities such as processing, packaging and transportation during the manufacture of goods. By doing so, CDP spreads awareness on an organisation’s carbon footprint and helps them reduce the same. The information gathered is used by senior management in over 50 of the largest organisations worldwide such as Walmart, PepsiCo and Dell.
Photograph by R. Senthil Kumaran.
WALKING THE TALK
A new investor led initiative by CDP is the Carbon Action programme. It requests companies to implement cost-effective greenhouse gas emissions reductions and its purpose is to accelerate company action on carbon reduction activities which deliver a satisfactory return on investment.
Specifically, companies are asked to make year-on-year emissions reductions; identify and implement investment in greenhouse gas emissions reduction initiatives which have a satisfactory positive return on investment; and if the company in question does not already have an emissions reduction target then they will be asked to set and publicly disclose this.
Speaking about the new programme, Steve Waygood, head of sustainability, research and engagement at Aviva Investors, the global asset manager and a founding signatory to Carbon Action, said: “Eighteen months ago, Aviva Chairman, Lord Sharman, called for the CDP to go beyond disclosure and challenge companies to take action that mitigates their climate change emissions. We warmly welcome the response of the CDP and thoroughly support the action that they and others are taking with us today. We believe that the external costs of greenhouse gas emissions will become internalised into company cash flows and profitability. We encourage companies to consider what action they can take now to reduce emissions.”
CDP – India
The 2011 CDP India sample covers the 200 largest companies in India based on market capitalisation. Partnering with WWF and the CII-ITC Centre for Excellence for Sustainable Development, CDP brings out an annual report that highlights actions of top Indian companies in reducing emissions as well as adapting to the direct impacts of climate change. It also identifies the preparedness of the Indian industry in converting the challenges posed by climate change into opportunities. Damandeep Singh who heads the CDP initiative in India believes it is particularly relevant to our country since it has been difficult to convince Indian industry to be proactive on climate change. There are no regulations on GHG emissions in India and therefore it is vital to push corporates to do an inventory.
CDP is also involved in various research initiatives and their website has an extensive list of the topics they have published papers on. Their vision is exemplary – they are targeting companies that wield tremendous influence over governments and the economy and bringing them into the fold of climate protection by showing them what they stand to lose in the face of unchecked global warming. By doing so, they are actively helping to minimise emissions around the world. Contact Details:
Carbon Disclosure Project India
Senior Advisor, India
Tel.: +91 98100 45950
Published in Sanctuary Asia, Vol. XXXI. No. 5. October 2011.