The Carbon Disclosure Project is an independent organisation which works with shareholders and corporations to disclose the Greenhouse Gas Emissions of the major corporations of the world. In 2007, it published the emissions data for 2400 of the world's largest corporations, accounting for 26% of global anthropogenic emissions. The CDP represents major institutional investors, with a combined $41 trillion under management.
Background
International agreements such as the Kyoto Protocol have proved problematic, while individual governments are reluctant to develop stringent national limits on emissions for fear of big companies relocating their factories and jobs to nations with laxer regulatory regimes. The Carbon Disclosure Project (CDP) side steps these national interests. CDP brings together institutional investors to focus attention on carbon emissions, energy usage and reduction – where ever companies and assets may be located. Greenhouse gas emissions (ghg) from large corporations are major instigators of global climate change, with some corporations having higher emissions than individual nation states. A few leading companies have moved to become carbon neutral, but for most there is enormous scope to reduce energy usage and climate related risk factors by adoption of energy efficiency methods and business planning that enables success in a carbon constrained economy.
Mechanism
CDP works with 2,400 of the largest corporations in the world to help them ensure that an effective carbon emissions / reductions strategy is made integral to their business. This effort is taken seriously because of the size of the shareholdings backing CDP - 315 institutional investors with $41 trillion under management. CDP operates from New York and London and has partners in 18 of the world’s major economies which help deliver the programme globally. It has:
- Established the world’s largest repository of GHG emissions and energy use data accounting for some 26% of global anthropogenic CO2
- Started to establish a globally used standard for emissions and energy reporting
- Examined the 265 major electric utilities globally (high GHG emitters)
- Obtained backing from blue chip investors including HSBC, JPMorgan Chase, Bank of America, Merrill Lynch, Goldman Sachs, American International Group, and State Street Corp.
- Active staff or partner organisations in the United States, Japan, Germany, China, United Kingdom, France, Canada, Netherlands, Brazil, Australia, New Zealand, among others
- Works with corporations including WalMart, Tesco, Cadbury Schweppes, Procter and Gamble, and many others to measure emissions through the supply chain.
Much of the data elicited has never been collected before. This information is helpful to investors, corporations and to regulators in making informed decisions which take into account corporate risk from future government legislation, possible future law suits and shifts in consumer’s perceptions towards heavy emitters. An estimated $27 billion will be spent over the next 30 years on energy related capital developments (new power stations, fuel distillation plants, etc). It is vital that the right technologies are adopted. In particular: • Giving higher priority to energy efficient design in new capital projects • Declaring firm targets for capping and reducing corporate emissions • Identifying new low carbon business opportunities • Pricing in how, under different scenarios, the price of carbon emissions will shift the economics of alternative sources of energy.
The process of companies having to respond to CDP delivers real changes in business practice resulting in lower energy use. In many cases this leads to a higher proportion of energy being sourced from renewables. CDP has 501(c)3 charitable status through Rockefeller Philanthropy Advisors in New York and is in the process of registering as a charitable organization in the United Kingdom.
