- Over 13,000 companies worth over 64% of global market capitalization, disclosed data through CDP on climate change, water security and deforestation in 2021, an increase of 37% since 2020;
- Over 1100 cities, states and regions disclosed data through CDP on climate change, water security and deforestation issues in 2021, an increase of 20% on 2020
- The overall number of disclosures grew by 35% this year and over 141% since 2015 when the Paris Agreement was signed
London, 14 October 2021: As COP26 approaches, and at a time when scientists are calling a ‘code red’ for the planet, CDP has seen record numbers of companies, cities, states and regions disclose their environmental performance via the CDP system; in 2021, over 14,000 reported data through global environmental non-profit CDP on climate change, water security and deforestation. Representing a 35% growth since 2020, this is the highest ever number of new disclosers that CDP has seen since its inception over two decades ago, demonstrating that more companies and cities are waking up to the climate and ecological emergency.
Over 13,000 companies, worth over 64% of global market capitalization, disclosed their environmental data through CDP this year, an increase of 37% since 2020. City disclosers grew to over 1000 cities, an increase of 30% on 2020. CDP reported increases in corporate disclosures across all three categories it currently covers: climate change, deforestation and water security.
The growth in disclosures proves that standardized disclosure works, has global reach and drives environmental action. This should provide further incentive for governments around the world to make environmental disclosure mandatory, as supported by the G7 in June and to be considered by the G20 in just two weeks’ time. CDP anticipates that ahead of COP26, more governments will announce their intentions to mandate environmental disclosure or to expand existing regulation. This will be essential for better tracking of companies’ and countries’ progress towards net-zero commitments.
The rise in corporate disclosures is a response to requests for information from 590 investors with over $110 trillion in assets, and over 200 major purchasing organizations with over $4 trillion in buying power, including Airbus, Sainsburys and Nike. This demonstrates the success of the market levers CDP utilizes in driving change.
The rise in city, state and region disclosure is a response to growing awareness of climate change since the signing of the Paris Agreement, with 93% of cities disclosing to CDP reporting that they are facing significant climate risks that put people and infrastructure at risk. The number of cities reporting has more than tripled since the signing of the Paris Agreement.
This record year of disclosures coincides with the release of CDP’s new 2021-25 strategy Accelerating the rate of change, which recognizes the urgent need to ensure companies, cities, states and regions have concrete plans to deliver on their stated commitments and provide evidence of progress against those goals. CDP recognizes that accountability is critical to ensure we halve emissions, become nature positive by 2030 and achieve net-zero emissions and full nature recovery by 2050.
The new CDP strategy sets out how CDP will respond to this need and how it will drive more meaningful action by deepening its engagement, tracking and analysis across a multiplicity of stakeholders, covering more of the capital markets, widening its scope to cover more environmental issues, and increasing its focus on tangible targets, transition plans and performance.
Over the next five years, CDP will further develop its systems and processes to support greater transparency and accountability from businesses, cities and governments. CDP already holds the world’s largest environmental database, and by 2025, will grow this to cover 90% of the highest-impact firms. CDP will apply its well-proven methodologies to an expanded range of environmental issues, to help investors, businesses, cities and governments act with the urgency required.
CDP will expand its definition of the “E” in Environmental, Social and Governance (ESG), to cover planetary boundaries, including oceans, land use, biodiversity, food production and waste. The organization will play its part in creating and demonstrating action on a wider range of environmental issues, and then formalize a reporting system which is good enough to legislate.
Through this expansion of its proven disclosure system, CDP is set to be the definitive mechanism to track the nature, extent and speed of corporate, city, state and regional action against their commitments and their impact on the global environment.
Paul Simpson, CEO of CDP, said:
“Over the past 20 years, CDP’s disclosure mechanism and leadership have transformed how capital markets, businesses, cities and governments understand and tackle environmental issues. This has helped standardize new global norms and practices, which are getting results.
But things need to move further and faster. All governments, companies, cities, states and regions must set ambitious environmental targets and take bold, transformative action to achieve them.
CDP has proven it can drive change through disclosure, insight and action. Over the next five years, by broadening the scope and deepening the reach of the CDP system, we will ensure that disclosure drives increased transparency, that insights lead to accountability, and that action catalyzes transformation.”
Dr. Angela Merkel, Chancellor of Germany, said:
“This environmental data both documents and fosters progress. For transparency encourages us to aim higher when it comes to protecting the climate and the environment”.
“We have to take resolute action now and not some indeterminate point in the future. These companies, cities and municipalities which have made their data available to CDP have demonstrated this resolve. They have come to realize that actively protecting the climate and the environment also gives them a competitive advantage. After all, sustainability is increasingly expected from investors and clients”.
“But nothing is more convincing than the success achieved and the example set by those who, with the aim of furthering climate change mitigation, know how to develop new products, services and processes from these new ideas. CDP fosters this competition to find the best ideas and put them into practice.”1
Michael R. Bloomberg, UN Special Envoy for Climate Ambition and Solutions, Founder of Bloomberg LP and Bloomberg Philanthropies, and Global Ambassador for the Race to Zero and Race to Resilience Campaigns, said:
“Disclosure is one of the most powerful tools we have in the global climate fight, and our push to accelerate its adoption is working. This new data shows record numbers of businesses, cities, states, and regions leading the way and using disclosure to deliver results. As the world prepares to convene at COP26, it’s up to nations to build on that success – and use transparency and reporting to help set even higher goals for cutting emissions, building resilience, and accelerating their climate progress.”
Notes to editors:
1. Speaking at the CDP Europe Awards 2021, March 02 2021.
CDP has established eight areas of focus to realise its 2025 vision:
1. Expanding our scope to cover planetary boundaries
The Earth’s systems on land, in water and in the atmosphere are increasingly threatened by human activity. Maintaining these systems will necessitate a radical transformation of our economies. CDP will expand its work to cover climate, forests and land, freshwater and oceans as well as cross-cutting issues such as biodiversity, resilience, waste and food.
2. Tracking and scoring progress along the science-based transition journey
To support reaching net-zero emissions and full nature recovery by 2050, CDP will begin scoring all companies against scientific benchmarks reflecting their historic, current and projected impacts; their product portfolios; and their investment and transition plans. This will provide a clear assessment of a company’s ambition and how they are doing against targets.
3. Increasing the influence of our system by reaching new actors
We will expand the range of ‘authorities’ that support our requests for environmental disclosure to include banks, stock exchanges, private equity, hedge funds, regulators, central banks and cities, amongst others. Our system will cover more high-impact companies, expand the disclosure request beyond public equities, and extend our mapping to entire value chains. Our data and insights will be more accessible and usable by more people
4. Enabling increasing policy ambition through driving action
Policy frameworks that seek to drive down emissions, tackle climate impacts and reverse ecosystem degradation are multiplying. CDP will provide policymakers with the proof points they need to implement rigorous regulation at scale and assess the impact of those regulations; and will continue to drive readiness for new regulation through our disclosure process, enhancing a cycle of ambition and the drive and knowledge to meet it.
5. Using our platform to implement standards at scale
We will continue to align with the most relevant and significant standards and apply them in ways that will drive scale of adoption and help improve future versions. This will help facilitate access to standardized and consistent information and reduce the need for multiple taxonomies and/or databases in different jurisdictions.
6. Catalyzing and scaling place-based action
CDP’s system serves as a nexus point for corporate, city, state and regional information. By incorporating more location-based data, expanding our coverage in the global south, bringing new public authorities into the system and ensuring local actors know what others are doing, we will help catalyze the scale-up of collaboration, capital allocation on environmental issues, and local action.
7. Enhancing transparency and reducing complexity with new technology
The CDP system will provide a mechanism to embed technological breakthroughs and new granular data sources into global environmental governance systems. We will feed additional data into our system, reducing the effort for disclosers and providing feedback to drive improvement over time.
8. Enhancing the Social and Governance metrics in our platform
We will explore how to integrate Social & Governance metrics into our platform, focusing on their intrinsic ties with environmental issues. We do not seek to develop deep expertise across the full ESG spectrum, but to facilitate the aggregation of data across S&G metrics by prioritising partnerships that support this.
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 590 investors with over $110 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. Over 14,000 organizations around the world disclosed data through CDP in 2021, including more than 13,000 companies worth over 64% 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. Visit cdp.net or follow us @CDP to find out more.