Each year for the past decade, the Carbon Disclosure Project (CDP) has published a report examining carbon reduction activities at the world’s largest public corporations.
For the first time ever in this ten-year history, the 2011 edition of the annual Carbon Disclosure Project (CDP) Global 500 report revealed that the majority of the companies have climate change actions embedded as part of their business strategy.
The report, titled Accelerating Low Carbon Growth, analyzed disclosures from 396 of the world’s largest companies and found that:
- 68 percent have climate change at the heart of business strategies, compared with 48 percent in 2010.
- Nearly half (45 percent) reported reduced greenhouse gas emissions as a result of emissions reduction activities –up significantly from 19 percent in 2010.
- 74 percent of Global 500 respondents reported emissions reduction targets, up from 65 percent in 2010
- The majority of respondents (93 percent) reported board or senior executive oversight for climate change (up from 85 percent in 2010), demonstrating the importance of climate change as a management issue.
It’s also most interesting to note that the report also identified a correlation between higher stock market performance over time, and representation on CDP’s Carbon Performance Leadership Index (CPLI) and the Carbon Disclosure Leadership Index (CDLI). More specifically:
- Companies with a strategic focus on climate change provided investors with approximately double the average total return of the Global 500 from January 2005 to May 2011.
As Paul Simpson, CEO of the Carbon Disclosure Project, points out this linkage puts companies that manage and reduce carbon emissions at a clear competitive advantage.
“The improved financial performance of companies with high carbon performance is a clear indicator that it makes good business sense to manage and reduce carbon emissions,” he said. “This is a win win for business – the short ROIs many emissions reducing activities have, can help increase profitability. Companies yet to take action on climate change will have to work hard to remain competitive as we head towards an increasingly resourced constrained, low carbon economy.”
The Carbon Performance Leadership Index and Carbon Disclosure Leadership Index are revised annually based on company submissions and present the leaders of the Global 500 in carbon performance and disclosure respectively. The top 10 best performing companies on both measures this year are: (more…)