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Established in 2000, CDP operates the world's largest environmental disclosure system, providing a comprehensive platform for companies, cities, states, and regions to measure, manage, and ultimately mitigate their environmental impact.
At NetNada, we encourage any organisations to consider CDP as part of their disclosure roadmap mainly because the processes and learnings along the way are an invaluable experience for boards, executives and sustainability teams alike.
By encouraging voluntary disclosure, CDP empowers a wide array of stakeholders, including investors, policymakers, and the public, to make informed decisions that drive sustainable development and climate action. CDP holds the distinction of being the first organization to leverage the influence of investors to encourage corporate disclosure on environmental matters.
CDP, formerly known as the Carbon Disclosure Project, is a global non-profit organization that operates the world's only independent environmental disclosure system. Driven by a commitment to transparency, CDP maintains the richest and most comprehensive dataset on corporate and governmental environmental action.
The organisation plays a crucial role in mobilising influencers across enterprise, capital markets, policy, and science, thereby enabling decisions that are most impactful for the planet.
With the belief in the power of data CDP aims to drive meaningful change.
A CDP disclosure encompasses key environmental areas reflecting a broad understanding environmental indicators including
The expansion of CDP's focus beyond carbon emissions indicates an evolving understanding of environmental sustainability, acknowledging the critical roles of water resources, forests, and plastic pollution in the overall health of the planet.
Disclosing environmental data through CDP offers a multitude of benefits for companies, investors, and customers alike, fostering a more sustainable and transparent global economy.
CDP provides a platform for a wide range of entities to disclose their environmental data. Recognising that environmental impact extends beyond the corporate sector, CDP also facilitates disclosure for cities, states, and regions.
CDP also has disclosure models for other entities beyond corporates:
The global reach of CDP is extensive, with regional offices and local partners spanning over 50 locations and engaging disclosers from more than 90 countries. Any organization, even without a direct disclosure request, can voluntarily report as a self-selected company, city, state, or region.
The CDP disclosure journey involves a structured, step-by-step process that enables companies to effectively communicate their environmental performance. This process generally encompasses registration with CDP, completing the disclosure questionnaire, undergoing verification if required, submitting the response, and ultimately receiving a performance grade.
The initial step is registration on the CDP Portal, accessible through the CDP website. New users are required to complete a registration form to gain access to the platform. Existing users typically receive an email invitation from CDP with instructions on how to sign in. Importantly, companies can also choose to register as Self-Selected Companies (SSCs) even if they have not received a direct request to disclose from stakeholders.
Once registered, companies proceed to the reporting phase, which involves completing the comprehensive disclosure questionnaire within the CDP Portal. The CDP reporting cycle typically opens in April, with the deadline for scored submissions falling in early July.
In a significant development for the 2024 reporting year, CDP has integrated its previous three separate questionnaires on climate change, forests, and water security into a single, unified corporate questionnaire. Recognizing the diverse nature of businesses, CDP offers different versions of the questionnaire, including a full corporate questionnaire designed for larger organizations and a simplified SME questionnaire tailored to the needs and resources of small and medium-sized enterprises. To streamline the process and ensure relevance, companies are presented only with questions that pertain to the specific environmental issues they have been requested to disclose on.
In some instances, CDP may require companies to undergo verification of the environmental data they have disclosed. This external validation is typically conducted by accredited third-party verifiers or by CDP's own verification team. Reflecting a commitment to data accuracy and integrity, the verification requirements for Scope 1 and Scope 2 greenhouse gas emissions were increased to 100% in both 2023 and 2024.
After completing the questionnaire and undergoing verification if necessary, companies must submit their responses through the CDP Portal by the designated deadline. It is important to note that amendments to previously submitted questionnaires can often be made before the closure of the reporting cycle.
The final stage of the disclosure process is scoring, where CDP evaluates the submitted responses based on the quality and completeness of the disclosure, as well as the robustness of the company's environmental programs. Companies are assigned a score ranging from A (highest) to F (lowest), providing a clear indication of their environmental performance. Following the evaluation, companies receive a detailed scorecard that offers valuable feedback on their performance and identifies areas for potential improvement. CDP scores are typically released towards the end of the calendar year or in the early months of the following year.
CDP assigns scores to companies and cities based on their environmental disclosure and performance to illustrate their progress and motivate further action. Scores range from D- to A, with F being assigned to organizations that fail to provide sufficient information or do not respond at all.
These scores help organizations benchmark themselves against peers and inform stakeholders about their environmental performance.
Disclosure
D- to D
Focuses on the completeness and relevance of the environmental information provided. Indicates that a company has started its environmental journey by disclosing data.
Awareness
C- to C
Evaluates the company's understanding of the links between environmental issues and its business activities. Assesses the thoroughness of the company's self-evaluation regarding its impact on people and ecosystems.
Management
B- to B
Recognizes companies that are implementing policies and taking actions to address their environmental concerns and minimize their negative impacts. Shows evidence of good environmental management but may not yet demonstrate leadership.
Leadership
A- to A
Awarded to companies that demonstrate best practices, strategic actions (such as science-based targets), and overall environmental stewardship. These companies are recognized as pioneers in environmental responsibility and set benchmarks for others.
While CDP disclosure is not currently mandatory for most organizations, there is a global trend towards mandatory environmental reporting. Participating in CDP offers numerous benefits. It helps organizations identify and manage their environmental impacts, demonstrate their commitment to sustainability to stakeholders and investors, benchmark performance against peers, stay ahead of evolving environmental regulations, and potentially attract investors who consider environmental risks and opportunities.
CDP offers several types of memberships to support different stakeholders in their environmental engagement:
CDP provides standardized questionnaires and detailed reporting guidance tailored to different sectors and entity types to ensure a degree of comparability in the disclosed data. The alignment of CDP's questionnaires with other frameworks like the TCFD and GRI also promotes consistency. Furthermore, CDP employs a scoring methodology that assesses the comprehensiveness and quality of the responses. While CDP does not directly verify all data, it does encourage and, for the highest "A" score, require companies and SMEs to verify their reported environmental data through accepted verification standards.
CDP is continuously evolving to broaden its scope and deepen its impact. It has expanded beyond its initial focus on carbon emissions to include areas like water security, deforestation, and plastics. CDP's Five-Year Strategy aims to cover more environmental issues, increase the focus on targets aligned with climate science (like the 1.5-degree goal and net-zero), and accelerate change through enhanced disclosure, insightful data analysis, and targeted action. Collaborations with other organizations like the GRI to standardize disclosures further contribute to its growing influence and effectiveness in driving corporate and governmental environmental action.
Organizations that disclose to CDP may have financial obligations primarily in the form of administrative fees for submitting their disclosures. It's important to note that only companies and public authorities are required to pay this administrative fee, while cities, states, and regions do not.
Here’s a breakdown of the financial obligations:
It's important to note that the fee structure and exemptions are subject to change.
Paul Dickinson:
A co-founder of the Carbon Disclosure Project (CDP) in 2000.
A founding member of Persefoni's Sustainability Advisory Board.
Played a key role in establishing CDP to empower investors to influence corporate environmental disclosure.
Tessa Tennant:
A co-founder of the Carbon Disclosure Project (CDP) in 2000.
Collaborated with Paul Dickinson to create a system that encourages companies to disclose their environmental impact.
AstraZeneca, L’Oréal, Mitsubishi Electric:
Examples of high-profile organizations that have earned "A List" status from CDP for multiple years, demonstrating leadership in environmental action and transparency.
ICLEI (Local Governments for Sustainability):
An international organization that partners with CDP to run CDP-ICLEI Track, the world's leading climate reporting platform for local governments and their cities.
Capital Markets Signatories:
Investors who have signed on to CDP's investor initiatives.
They gain access to environmental disclosure data from reporting companies and can participate in campaigns like the Non-Disclosure Campaign.
Supply Chain Members:
Companies that join CDP's Supply Chain program.
They use CDP's platform to request environmental disclosures from their suppliers and gain insights into their value chain emissions (Scope 3).
Reporter Services Members:
Companies that subscribe to CDP's Reporter Services program.
They receive tailored support, access to data, and insights to aid in their environmental reporting and risk management.
Accredited Solutions Providers:
A network of trusted providers offering expertise and services to organizations looking to improve their environmental performance and disclosure through CDP.
Self-Selected Companies (SSCs):
Companies that choose to disclose their environmental data through CDP even if they have not received a request from stakeholders.
They must apply to CDP and pay an administrative fee to disclose.
Banks Program Members:
Financial institutions that are part of CDP's program engaging with companies on environmental issues.
They can request environmental data through the CDP platform.
Private Markets Program Members:
Investors focused on private equity and other private markets who utilize CDP's platform for environmental disclosure from private companies.
RE100 and The Net Zero Asset Managers initiative (NZAM):
Examples of membership programs and initiatives that request environmental data through CDP from their members or investee companies.
Global Reporting Initiative (GRI):
An organization that develops reporting standards for sustainability.
CDP collaborates with GRI to standardize environmental disclosures.
Task Force on Climate-related Financial Disclosures (TCFD):
A framework for reporting climate-related financial risks and opportunities.
CDP's questionnaire is aligned with the TCFD recommendations.
International Sustainability Standards Board (ISSB):
An organization that develops global sustainability disclosure standards.
CDP's scoring methodology is aligned with ISSB standards.
