NEWS & INSIGHTS

Carbon Disclosure Project (CDP), explained

Knowledge is power. To make strides towards a sustainable future, we must start with a concrete understanding of our current impact.   

This understanding equips stakeholders, from investors to governments, to make informed decisions. 

CDP runs the largest global disclosure system, covering thousands of companies, cities, states and regions. 

Why is CDP the go-to standard for corporate environmental reporting? 

Our experts have prepared a comprehensive overview to bring your business up to speed. 

What is the Carbon Disclosure Project? 

The CDP is a non-profit organisation that provides a platform for companies and their suppliers to effectively manage their impact on the environment.  

It operates the world’s largest global disclosure system, covering thousands of companies, cities, states and regions. 

They execute numerous functions focusing on different areas of sustainability, including setting targets, mesurement of emissions, collaboration with suppliers and recognition for outstanding leadership. 

How does CDP contribute to measuring and managing companies’ carbon emissions and sustainability performance? 

Through its global disclosure system, CDP allows organisations to track and disclose their greenhouse gas emissions, water usage, and deforestation risks.  

This transparency helps companies identify areas for improvement and develop strategies to reduce their environmental footprint. 

Members of the program also have the ability to collaborate with their suppliers and participate in a revered international leaderboard that unlocks industry opportunities (investment, increased trust, boosted reputation) 

What are the criteria and methodology used by the CDP? 

CDP uses a scoring system to create a snapshot of a company’s environmental disclosure and performance. Responding companies are assessed and scored across four levels.  

  • Disclosure (D-/D score) 
  • Awareness (C-/C score) 
  • Management (B-/B score) 
  • Leadership (A score) 
  • Failure to disclose (F score) 

Criteria for each level is expanded on here.  

The methodology assesses: 

  • The level of detail and comprehensiveness in a response 
  • The company’s grasp of environmental issues 
  • Management methods
  • Progress towards environmental stewardship 

How does CDP influence global sustainability practices? 

By offering a platform for companies, cities, states, and regions to report their environmental impact, CDP has effectively established a global benchmark for environmental transparency and accountability. 

According to a CDP report last year, over 680 investors with $130 trillion in assets, and 125 major purchasers with $4.5 trillion in procurement spend, use the data collected by CDP. 

CDP’s scoring methodology has also become a benchmark for corporate environmental responsibility. High scores on CDP’s assessment can enhance a company’s reputation, making it more attractive to investors, consumers, and potential employees. Conversely, low scores or failure to disclose can signal to stakeholders that a company may be lagging in its sustainability efforts. 

What is in the CDP questionnaire, and how to get certified? 

CDP has three corporate questionnaires: climate change, forests and water security. 

Companies may be requested to respond to all, or a combination, of these.  

There are updated questionnaires released each year with submission cut off dates.  

The questions are related to governance and policy, risks and opportunity management, environmental targets and strategy, and scenario analysis.  

View the complete CDP questionnaires here. 

Once the questionnaire is completed. CDP will allocate an official score.  

Review the 2023 submission timeline.  

How to source carbon emissions data for CDP reporting? 

Historically this was a tedious and labour intensive process. Now, through the power of technology, Clear.VUE Zero has automated sourcing Scope 1 and Scope 2 emissions data.  

For Scope 1 emissions, ClearVUE.Zero monitors on-site energy consumption from sources like boilers, generators, and company vehicles. This allows businesses to identify high-emission activities and implement strategies to reduce these emissions. 

For Scope 2 emissions, ClearVUE.Zero tracks the consumption of purchased energy. It provides detailed insights into when and where this energy is used within a company’s operations.  

The platform also has a feature that allows businesses to instantly download reports with their data in a corporate format with buil-in standards.  

What is the significance of the CDP Leadership Index? 

A certified  platform for scoring companies and cities using accurate data has created an internationally recognised standard that incentivises businesses to disclose.   

View the official A-List leaderboard results: 

Companies leading the way on transparency and action  

Cities commended for environmental performance in 2022 

What are some notable success stories or case studies of companies adopting CDP? 

Here is a summary of actions taken by two companies that have adopted the CDP.  

Moody’s: Integrated Risk Management, US

  • Set a target to achieving net-zero by 2040, a decade earlier than the Paris Agreement goals 
  • Created an objective (2022) to reduce of 90% reduction of Scope 1, 2 and 3 emissions 
  • Became one of the first companies to have their net near- and longterm targets validated by the Science Based Targets initiative (SBTi) 
  • Formalised their Decarbonisation Plan, which lays out the roadmap for achieving our near-term targets 
  • Hosted CDP webinars for nearly 500 of their top suppliers 
  • In 2021, 28% of their suppliers had science-based targets 
  • Created a goal to extend this to cover 60% of suppliers by spend by 2025
  • Further trained their sourcing managers to support their suppliers’ journeys to net-zero (2022) 

 

Loreal: Manufacturing, France

  • Set overarching 2030 objective to reduce our greenhouse gas emissions of all scopes by 25% in absolute terms and by 50% per finished product.  
  • Reduced the CO2 emissions of our plants and distribution centers by 87% in absolute value, compared with 2005, while our production increased by 37% over the same period.  
  • Working with their suppliers to reduce their own emissions, with official targets to achieve this  
  • Working to reduce the carbon emissions and water consumption associated with the product-use phase.  
  • Innovating to reduce greenhouse gas emissions and water consumption from the use phase of our products with the aim of 25% reduction compared to 2016 (on average and per finished product).  
  • Adapted to create products that require little or no water, including a Loreal shower waterhead that reduces water consumption in hairdressing salons by up to 65%.  
  • Addressed the most pressing environmental issues, including waste management, plastic pollution and biodiversity loss with two specific environmental impact investing funds. 
  • Launched New Circular Innovation Fund (50 million+) 

Read more case studies from CDP, in their Stories of Change 2022 Publication.  

What is the role of the CDP in promoting sustainable supply chain practices? 

The project runs a CDP Supply Chain membership, with over 280 subscribers worldwide.  

Businesses use the system to create and achieve their science based targets.  

They are also able to engage with their suppliers to identify risks and opportunities.  

How it works

  1. Businesses request their key suppliers to report environmental data through CDP’s questionnaires. 
  2. CDP provides expert support to both the business and their supplies, including the provision of engagement strategies and resources 
  3. CDP delivers reporting data, analysis and insights on the business’ suppliers 

What are the future goals and initiatives of the CDP? 

In 2021, CDP launched their 5 year strategy: Accelerating the rate of change

They are setting out to achieve a world which can be defined by the following attributes: 

  • Significantly enhanced transparency on environmental issues, with a critically larger group of stakeholders, creating a comprehensive, holistic picture of companies’, cities’ and subnational governments’ impact on earth’s natural systems. 
  • Actors are held to account for what is needed to ensure a transition to a 1.5ºC, nature-positive world. 
  • A transformation has been catalysed, building the foundation for a 1.5 nature-positive global, equitable economy.

*extracted from the official 2021-2025 CDP strategy document. 

Aligning with CDP: Transforming the future together 

ClearVUE.Business stands as a partner for businesses navigating the complexities of environmental reporting and performance. 

As the world moves towards a sustainable future, ClearVUE.Business is committed to helping businesses play their part in this global transformation. 

By aligning our solutions with the CDP’s comprehensive disclosure system, we aim to accelerate the rate of change and contribute to a sustainable change in global enegry behaviour. 

Join the solution today. Our team of experts are ready to discuss the first steps of your net zero journey!  


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