- A record 288 financial institutions with nearly US$29 trillion in assets – Schroders, Cathay Financial Holdings (Cathay FHC), Aviva Investors and Manulife – are directly engaging with 1,607 highest-impact companies not currently disclosing environmental data through CDP
- Saudi Aramco, Exxon Mobil Corporation, Glencore, Chevron, Tesla Inc, Volvo Group, Roche Holding AG, Swatch Group, and Caterpillar among non-disclosing companies, with over US$21 trillion in assets, to be directly targeted in the financial institution-led campaign
- The number of financial institutions backing the CDP campaign has more than quadrupled since it launched in 2017, as mandatory disclosure regulation across the UK, EU, Brazil, Japan, and US inches closer
- Demand for disclosure on companies’ impacts on climate change remains high at nearly 72%, while demand for disclosure on forests rises by 3%.
The annual financial institution-led Non-Disclosure Campaign (NDC) launches with an unprecedented 288 global institutions directly engaging 1,607 of the world’s highest-impact companies to demand that they disclose environmental data through CDP, the global environmental disclosure non-profit. The campaign sees financial institutions using their influence and market position to help drive responses from companies that have failed to respond to CDP’s disclosure request.
CDP’s analysis of its 2022 non-disclosure campaign, which drove responses from 388 high environmental impact companies, revealed that companies were overall 2.3 times more likely to disclose if they were directly engaged by financial institutions. This year, Schroders, Cathay FHC, Aviva Investors, Manulife, Sumitomo Life Insurance, AQR, Legal & General Investment Management (LGIM) and PGGM will join financial institutions from across 31 countries, with a staggering total US$29 trillion in assets, to urge non-disclosing companies to respond to CDP’s disclosure request. Since the campaign launched in 2017, financial institutions’ participation has more than quadrupled – showing an average yearly growth of 33%.
The companies targeted in the 2023 campaign include repeat non-disclosers such as Saudi Aramco, Exxon Mobil Corporation, Glencore, Chevron, Tesla Inc, Volvo Group, Roche Holding AG, and Caterpillar. Combined, all 1,607 high-impact companies sprawled across 51 countries, represent a combined +US$21 trillion in global market capitalization (as of February 2023), and emit an estimated +4,200 megatonnes (Mt) of carbon dioxide equivalent (CO2e) annually – almost equivalent to the GHG emissions of the United Kingdom, the European Union and Canada combined.,
Companies will be asked to disclose data on at least one of three priority themes of climate change, forests, water, and for the first time a new module of plastics in the water questionnaire – as relevant to their operations – with an aim to drive greater transparency on environmental impacts and investment risk and increase capital market action on sustainability.
Keeping with the trends from previous campaigns, data on climate change-related disclosure remains the most highly sought data by financial institutions – 72% of companies targeted will be asked to disclose on this theme. Despite the higher rate of requests for climate change data, financial institutions are increasingly pushing for disclosure and action on water and deforestation – this year, 28% of the companies targeted will be requested to report on their water-related impact, while 26% will be asked to disclose on forests. With deforestation rates at 10 million hectares per year and 22% of emissions coming from land use, the consistent rise in the number of companies being asked to disclose on forests impact points to both an awareness of the impact of corporate activities on forests and the increasing risks deforestation poses to business operations.
Companies like Glencore, Swatch Group, DTE Energy, and South32 failed to disclose their climate change, forests, and water-related impacts in 2022 and will be targeted for disclosure this year. BP, Amazon, and BMW disclosed on climate change the previous year, but did not respond on forests and water security. They will be called to disclose across all three themes in the 2023 campaign.
Water-related impact is growing as a priority focus for financial institutions. Biotech and pharmaceuticals, retail as well as oil and gas extraction and production companies, are the industries most targeted for disclosure on water in this year’s campaign. CDP’s NDC supporters will be seeking disclosure from corporations such as Walgreens Boots Alliance, TJX Companies, Inc. and Lockheed Martin (all three disclosed on climate change previously but not on their water impact), and GlaxoSmithKline Pharmaceuticals (India). The apparel and textiles industry, due to heavy use and pollution of water throughout the production process, are also key targets for disclosure on this theme – Shenzhou International Group, Moncler, Skechers, Aldo, Samsonite and Geox are some of the companies that will be asked to provide data on their water-related impact.
Incoming mandatory disclosure regulation across the UK, EU, Brazil, Japan, the US, and most other major economies has increased pressure on financial institutions and companies alike, if they are to remain agile and competitive in a rapidly evolving market.
Sophia Cheng, Chief Investment Officer, Cathay FHC, said: Cathay has been participating in Non-Disclosure Campaign since 2017, recognizing transparency is essential for net-zero transition. In 2022, Cathay has set validated Science-Based Targets (SBT) and become the first Taiwan RE100 financial institution member. We believe responding to CDP is an important part of corporate disclosure and allow investors to understand the climate governance and performance of investees. From our experiences, over half of companies were enhancing climate management performance in the following years. Cathay is committed to being the responsible investor to cultivate resilience and sustainability.
Claire Elsdon, Global Director, Requesting Authorities - Capital Markets, CDP, said: “Despite ongoing discourse over the role of ESG in financial decision-making, the continuous growth in supporters of the CDP’s non-disclosure campaign demonstrates that financial institutions worldwide require data to support risk management practices, tracking portfolio alignment to net zero goals and unlocking sustainability-linked opportunities. These uses can serve to not only safeguard but also boost long-term profitability.”
“CDP’s financial institutions-led non-disclosure campaign continues to raise demand for corporate transparency and provide a powerful incentive for companies to step up their environmental reporting and action. The unprecedented support for the campaign signals recognition that robust transition plans necessitate higher rates of transparency across all segments of the environment, and a holistic understanding of financial risks, to better future-proof operations and accelerate the path toward a net-zero, nature-positive global economy.”
The platform is now open, and the deadline for companies to submit their questionnaires in order to be eligible for scoring is July 26, 2023. Financial institutions will be engaging with companies during CDP’s disclosure period, during which target non-disclosing companies will be asked to submit their response via the CDP online response system.
Note to Editors
CDP media contact: Toyosi Adebayo | [email protected]
More information on CDP’s 2022 Non-Disclosure Campaign
- A record high 260 financial institutions, with nearly $US30 trillion in assets, participated in CDP’s 2022 Non-Disclosure Campaign. Financial institutions requested disclosure from almost 1,500 high-impact non-disclosing companies.
- The 2022 campaign drove responses from 388 high environmental impact companies. Analysis of the results showed that engagement from campaign leads encourages companies to disclose and continuously respond to subsequent requests, helping them progress on their sustainability journey. 90% of companies asked to disclose in 2021 for the first time, responded again in 2022.
- For more details, read the 2022 CDP Non-Disclosure Campaign: Results Report.
CDP is a global non-profit that runs the world’s environmental disclosure system for companies, cities, states and regions. Founded in 2000 and working with more than 740 financial institutions with over $130 trillion in assets, CDP pioneered using capital markets and corporate procurement to motivate companies to disclose their environmental impacts, and to reduce greenhouse gas emissions, safeguard water resources and protect forests.
Nearly 20,000 organizations around the world disclosed data through CDP in 2022, including more than 18,700 companies worth half of global market capitalization, and over 1,100 cities, states and regions. Fully TCFD aligned, CDP holds the largest environmental database in the world, and CDP scores are widely used to drive investment and procurement decisions towards a zero carbon, sustainable and resilient economy.
CDP is a founding member of the Science Based Targets initiative, We Mean Business Coalition, The Investor Agenda and the Net Zero Asset Managers initiative.
Find out more via www.cdp.net or follow us on twitter @CDP.