CDP UK Climate Change Report 2015

CDP provides a global system for companies to measure, disclose and share information about their climate change risks, strategies, emissions and reduction initiatives. Now in its 14^th year, data is collected on behalf of 822 institutional investors – an increase of 100 participants over the last two years – spanning 2000 companies in 50 countries, representing $95 trillion in invested assets. Companies are scored on the extent to which they disclose information (on a scale of 0-100) and on their performance in terms of emissions reduction activities (E to A).   This year’s results, which were released last week, revealed how corporate attitudes towards climate change have developed since 2010. In the UK, four companies, including a well known supermarket chain managed to attain a perfect score of 100A, demonstrating mature reporting systems and reduction programmes. Companies achieving a disclosure score in the top 10% secure a place in their regional Climate Disclosure Leadership Index (CDLI).   The CDP Climate Change Report 2015 summarises the key developments in how companies are responding to climate change. Noteworthy emerging trends are:

• Improved governance within companies (i.e. senior-level engagement)
• Increased percentage of companies setting targets
• Increased number of investors as they engage in a multitude of climate-change related initiatives
• CDP increasingly uses sector-specific modules in the questionnaire to give a fair and appropriate picture for each sector

     Moreover, companies are implementing a multitude of projects such as:

• Improving energy efficiency in buildings and processes
• Installing or building low carbon energy generators
• Changing employee behaviour, for example by encouraging cycling

Leading companies are increasingly recognising that addressing climate change can help create competitive advantage. This is timely given the COP21 convention in Paris in December. In response to the question as to whether companies would support a climate change agreement limiting global warming to 2°C, 805 companies said yes with 101 responding in a reverse way, 1075 had no opinion, and 331 did not answer the question. This seems to indicate that there appears to be more corporate support for an agreement than during some of the other COPs that took place in recent years but failed to producing a binding treaty.

These developments demonstrate a surge of business interest in climate change and environmental impacts and emphasise the role these themes are increasingly playing in business decision making. The CDP is more and more used as a signalling tool for companies to show their performance and to use as a framework for corporate sustainability. Regardless of the outcomes of the climate conference, it is now clear that corporate environmental sustainability is here to stay.