Other than terrorism and the continuing global economic challenges, the world stage faces few crises as pressing as climate change. So, three weeks ahead of the UN climate change conference to be held in Paris, COP21, there is an interesting report out from international not-for-profit CDP, which holds the most comprehensive set of global corporate environmental data. It has released its annual Climate Change Report on behalf of 822 investors representing US$95 trillion.
Using what is characterized as “the most comprehensive set of global corporate environmental data,” the report reveals the extent to which corporations have shifted their strategies over the past five years in order to address climate change. CDP compares data from 1,997 companies this year, with data from 1,799 in 2010. What it found is that companies globally are investing in capabilities in order to transition to a low carbon economy.
Plus, CDP encouragingly reports that 94 percent of companies now assign board or senior management to address climate change; three quarters of companies offer incentives for improving climate performance; and nine of every ten companies have activities in place that are lowering their carbon output. Also, the percentage of businesses with plans to reduce greenhouse gas emissions has also more than doubled.
We’ve got you on the list!
The new publication includes the 2015 Climate A List, which comprises those companies identified as A grade for their actions to mitigate climate change. It is worth a download to see if your favorite brands made the list. In fact, what is interesting is that of the almost 2,000 companies that applied to be independently assessed against CDP’s scoring methodology, 113 made the A list and tech companies stood out.
The list includes such household names as Apple, Microsoft and Google, the three largest by market capitalization. Other noteworthy ICT companies that made the list are: Accenture, Alcatel-Lucent, Cisco, EMC, HP, Hitachi, Juniper, LG and Samsung on the product side of things and Proximus (formerly Belgacom), KT Corporation, LG Uplus, Sprint, Swisscom, Telefonica and Telenor Group representing communications services.
The list is obviously important, but just how important can be seen in Appendix II of the report. In a bit of an exercise to publically shame them, there is a list of the largest non-responders by market capitalization. For example, noteworthy for their absence are Agricultural Bank of China Ltd, Berkshire Hathaway, and Facebook, the three largest by market capitalization companies that have failed to disclose to investors via CDP.
What is also important is, as the headline above touts, that the report poses the question, “At a tipping point?” The short answer is yes! The 74 page report, with a slew of facts and figures, provides ample substantiation.
Commenting on the report, CDP’s executive chairman and co-founder Paul Dickinson says: “The influence of the corporation is mighty. The momentum of business action on climate change suggests we have reached a tipping point, where companies are poised to achieve their full potential. They need ambitious policy at both a national and international level that will support them in this regard and will catalyze participation from industry at scale.”
Meg Whitman, President and CEO at Hewlett Packard Enterprise, which has achieved A List status this year, says: “We must take swift and bold action to address the root causes of climate change. This means disrupting the status quo - changing the way we do business, holding ourselves and others accountable, and creating innovative solutions that drive a low-carbon economy.”
Finally, again looking at the value of shame, CDP says: “The growing momentum among the corporate world is coinciding with increasing engagement on climate change from the investor community. If the recently introduced landmark pension fund voting guidelines known as the Red Lines are applied, failure to disclose to CDP may put chairpersons’ jobs at risk. And more investors are betting on a sustainable future: US$21.4 trillion was invested in 2014 in funds with environmental, social and governance mandates, up 61% in two years.”
Without getting into the politics of climate change, the stewardship and acceptance of eco-sustainability responsibilities across the board is impressive, as is the inclusion of so many ICT companies who through data transparency, investments and performance are showing that it is possible to be not just good corporate citizens but also it is possible to do well by doing good.
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