CDP Global 500 Report 2011: Accelerating Low Carbon Growth

The 2011 edition of the annual CDP Global 500 report examines the carbon reduction activities at the world’s largest public corporations.


The 2011 Carbon Performance Leadership Index (CPLI)

This year, for the second time, all companies with a sufficiently high disclosure score received a performance band; the qualifying threshold to receive a performance band was a disclosure score of 50. Disclosure scores of less than 50 do not necessarily indicate poor performance; rather, they indicate insufficient information to evaluate performance. However, it can be assumed that companies which do not disclose are inactive on climate change.

Performance is grouped into six bands: A, A-, B, C, D and E (see Figure 22).

The Carbon Performance Leadership Index (CPLI) includes the companies in the highest performance band (A) and provides a valuable perspective on the range and quality of activities being performed by the Global 500 in response to climate change.

Figure 22: Carbon performance elements

Eligibility for the CPLI (Band A)

  • Attain a disclosure score of 50 or above
  • Attain a performance score greater than 70
  • Score maximum performance points on question 13.1a (absolute emissions performance); at least a 2.65%16 reduction in carbon emissions must have been achieved as a result of emissions reduction activities over the last year
  • Disclose gross global Scope 1 and Scope 2 figures
  • Score maximum performance points for verification of Scope 1 and Scope 2



  • Band A- (A minus) companies are not in the CPLI. They are strong performers, with a performance score high enough to warrant inclusion in the CPLI but they do not meet all other CPLI requirements
  • CDP reserves the right to exclude a company from the CPLI if there is anything in its response that calls into question its suitability for inclusion

Performance scoring is an instructive exercise for all stakeholders. The score provides an indication of the extent to which companies are addressing the potential opportunities and risks presented by climate change. CDP recognizes that this is a process that will evolve over time. It is important for investors to keep in mind that the carbon performance band is not:

  • A measure of how low carbon a company is
  • An assessment of the extent to which a company’s actions have reduced carbon intensity relative to other companies in its sector
  • An assessment of how material a company’s actions are relative to the business; the score simply recognizes evidence of action

It is possible to review individual company disclosures in addition to performance rankings in order to gain the most comprehensive understanding of company performance. A listing of companies and their bands is included in Appendix I. Companies that did not qualify for a performance band appear in Appendix I with a dash (-) in the performance band column.

More information on the CPLI can be found in the information request, supporting methodology and guidance documents.

16. The Intergovernmental Panel on Climate Change (IPCC) has set a target of 80% reduction in emissions by 2050, based on 1990 levels. This equates to a 2.65% annual reduction.


Figure 23: The Global 500 CPLI 2011

In 2011, 404 Global 500 companies responded to CDP; 29 of these attained Global 500 performance leader status, as identified below. These companies represent nine of the ten sectors.

Sector Company Carbon disclosure score
Consumer Discretionary BMW 96
Fiat 93
  Honda Motor Company 95
  Philips Electronics 99
Consumer Staples British American Tobacco 91
Tesco 97
Energy BG Group 85
Financials AXA Group 92
Bank of America 97
Bank of Montreal 88
Commonwealth Bank of Australia 89
Morgan Stanley 87
National Australia Bank 91
Swiss Re 91
  UBS 91
  Westpac Banking 96
Health Care Bayer 99
GlaxoSmithKline 93
  Novartis 94
Industrials CSX 85
Lockheed Martin 90
Schneider Electric 91
Information Technology Cisco Systems 98
Samsung Electronics 94
  SAP 96
Sony Corporation 94
Materials Air Products & Chemicals 92
Telecommunications No Companies  
Utilities ENEL 89 

The companies highlighted in orange are those that have moved into the Global 500 CPLI this year.

In 2011, CDP has raised the bar by enhancing the scoring methodology for both disclosure and performance questions to make the scoring results more relevant to investors and other stakeholders.

The average performance score for 2011 is 4 points lower than in 2010. This is primarily the result of a change in focus of the performance scoring rather than a change in corporate performance. In 2010, the focus was to measure the extent to which a company had a framework in place to address carbon management. This year, performance focuses more on measuring the ambition and success of a company’s short and long term actions to mitigate climate change.

Overall, 338 Global 500 companies (85%) received a performance band compared to 310 companies in 2010 (76%). However, as a consequence of more stringent CPLI entrance criteria on emissions reductions and verification, the number of companies included in the CPLI dropped from 48 to 29. A lower percentage (36%) of companies achieved a high performance band (A, A- or B) in 2011 than 2010 (52%). This is, again, largely due to the qualifying criteria being more stringent.

Figure 24: Comparison of performance bands between 2010 and 201179% (23) of the CPLI companies were also in the CDLI – this is an improvement on 2010 (69%, 33) and indicates that senior executives in an increasing number of companies are not only aiming to be transparent about their emissions but are also actively striving to reduce their emissions. Many companies with a high disclosure score, combined with a high performance band, note the strategic benefits that taking a leadership position in carbon adaptation and mitigation offers.

It is important to note that performance improvements take longer to implement and often lag behind improvements in disclosure. As companies measure, they can manage and then begin to perform and optimize results. True performance enhancements take longer to achieve and the expectation is that companies’ performance will continue to improve over the coming years.

For the second consecutive year, the Financials sector has the most companies in the CPLI (9 companies – 31% of the total CPLI). This is partly because Financials is highly represented in the Global 500, but it also clearly shows that some financial services companies have prioritized action on climate change. The only sector with no companies in the CPLI is Telecommunications. This is surprising given that the Telecommunications sector is increasingly seen as providing technology that can support emissions reduction activities.

Utilities is the best performing sector with an average performance band ‘B’. This may be a reflection of the impact of regulations on the Utilities sector and shows that these companies are taking a range of actions on climate change.

The sector with the lowest average performance band was Information Technology (band C). This reflects their lower than average number of emissions reductions activities as well as less frequent verification. As with the Telecommunications sector, this result is surprising given the expectation that Information Technology has the potential to support a wide range of emissions reduction activities.

Figure 25: Key indicators of performance leaders compared
to all respondents

The graph in Figure 25 compares the key indicators achieved by CPLI companies with the average Global 500 across four key areas: strategy, governance, stakeholder communications and achievements. All responding companies (CPLI and non-CPLI) performed well in the implementation of emissions reduction targets (strategy) and Board or executive-level oversight indicators (governance); these appear to be the core ‘early-stage’ areas of addressing climate change which have been met by the majority of respondents.

Analysis of the most significant areas of outperformance of the overall Global 500 by the CPLI provides insights into the characteristics of carbon performance leadership:



The CPLI companies distinguish themselves through demonstrated integration of their climate-related risks and opportunities into their overall business strategy. 100% (29) of CPLI companies achieved this key indicator in 2011 compared to 68% (269) of the overall Global 500.


The use of monetary incentives is a significant area of outperformance by CPLI companies compared to the overall Global 500. 100% (29) of CPLI companies use monetary incentives compared to 65% (259) of the Global 500. Linking employee incentives to climate change strategy demonstrates a clear drive towards low carbon growth.

Stakeholder communications

Companies are required to score maximum points for verification of Scope 1 and Scope 2 to be eligible for inclusion in the CPLI. In contrast, only 37% (148) of the overall Global 500 (versus 100% of CPLI companies) meet all of CDP’s verification criteria in 2011. Companies’ strategies to reduce emissions require analysis and decision-making based on reliable emissions data.


In support of their commitment to reduce emissions, 100% (29) of CPLI companies reported significant emissions reduction in the past year compared to 45% (178) of the overall Global 500. The success in achieving reductions may be due to more mature climate change initiatives from CPLI companies that are already realizing results in emissions reduction.

Geographical Representation of the CPLI

Figure 26: Percentage of companies in the CPLI by regionEurope and Australia are the strongest performing regions in 2011. Europe has the most companies in the CPLI (16, 55% of CPLI) despite only representing 34% of the responding population. This is similar to 2010 when it represented 60% of the CPLI with 29 companies. Australia makes up 10% of the CPLI despite only representing 3% of the Global 500 responding population. North American (USA and Canada) companies make up 24% of the CPLI despite only representing 42% of the Global 500 responders.

17. Figure 27 showing % of CPLI by country does not include the countries with no companies in the CPLI.

Europe and Australia are the strongest performing regions in 2011. Europe has the most companies in the CPLI (16, 55% of CPLI) despite only representing 34% of the responding population. This is similar to 2010 when it represented 60% of the CPLI with 29 companies. Australia makes up 10% of the CPLI despite only representing 3% of the Global 500 responding population. North American (USA and Canada) companies make up 24% of the CPLI despite only representing 42% of the Global 500 responders.

The best performing country was Germany which made up 14% of the CPLI with only 5% of respondents.

Australia, Italy, Switzerland and the UK are also performing relatively well. The USA had the most companies in the CPLI for the second year running with 6 – however, this only represented 21% of the CPLI while the USA represented 36% of respondents. Likewise, Japan and Canada CPLI representation was lower than their proportional number of responses. Notable absentees from the CPLI in 2011 include Brazil, China, Russia, South Africa and Spain.

Figure 27: Percentage of companies in the CPLI by country


CPLI and Shareholder Value

Companies included in the CPLI in 2011 have a higher total return18 from January 2005 to May 2011 than Global 500 companies, outperforming them by a total of 40 percentage points over the six year period.

When analyzing companies included in the CPLI for the last two19 consecutive years, an even stronger result is revealed: they outperformed the Global 500 by over 50 percentage points over the same period. This indicates that companies which have an integrated climate change strategy and are successfully managing their emissions demonstrate higher financial performance.

It is noted that the relationship between strong carbon performance and total return has not been fully explored. The relationship between total return and carbon performance does not necessarily indicate that one causes the other; both will be influenced by a range of factors. These may include the quality of the company’s management or the company’s broader approach to identifying and capitalizing on opportunities or managing risks. These findings would benefit from further analysis by the investment community.

18. Total Return includes interest, capital gains, dividends and distributions realized over a given period of time.
19. CPLI was launched in 2010 and is now in its second year.

Figure 28: Total return % (US$)

It is notable that the period when CPLI companies’ total return falls below Global 500 companies’ total return is in late 2008, during the economic downturn. Although total return fell across all sectors, the downturn particularly affected the Financials sector which makes up the highest proportion of companies in the CPLI.

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