What is emission disclosure and why should you care?
Emission disclosure is a formal process where companies disclose their direct and indirect carbon emissions data – in other words, sharing their footprint into the public record.
There are several reasons why companies disclose or report their emissions data. When companies set ‘net-zero’ goals, publicly disclosing their emissions history becomes important to protecting the reputation of the company from negative scrutiny or claims of greenwashing.
Even if a company has not set a ‘net zero’ goal, their clients, partners, suppliers or investors may ask them to publicly disclose their emissions, as their carbon footprint is interconnected.
Over the course of the last 5 years, we’ve seen companies require their partners to join them in Diversity and Inclusion efforts – this is the same process, but for sustainability goals.
This trend is affecting businesses of all types, for example the Law Firm Sustainability Network found recently that 87% of firms responded that their RFPs had inquired about the firm’s environmental efforts.
Publicly disclosing and committing to reduce your emissions is a practice that goes a long way when trying to convince investors and consumers of your support for sustainable initiatives.
Aside from issues of compliance, emission disclosure is important for businesses trying to get ahead of legislative trends and encourage positive value purchasing. A recent study by Simon-Kucher & Partners showed that increasing shares of consumers prioritize sustainability when choosing to spend their money. Younger consumers, specifically Millenial and Gen Z consumers, not only consider sustainability when making decisions but are more willing to pay more for sustainable products and services.
50% of consumers see sustainability as a top 5 factor when determining the value and personal importance of a product/service.
What is the Climate Disclosure Project (CDP)?
The Climate Disclosure Project (CDP) is a global repository of emissions data. Operating in over 90 countries, the CDP is spearheading a global push to integrate climate risk and social responsibility into strategic planning for businesses, municipalities, and beyond.
The CDP’s disclosure platform and methodology hinge on creating a global carbon database, finding ways to optimize the supply chains of their members and creating actionable climate transition plans. CDP member companies are some of the biggest companies in the world and include Goldman-Sachs, AT&T, Nike, AstraZeneca, Bristol-Myers Squibb, L’Oreal and Walmart.
Who does this apply to?
- CDP reporting is open to any organization and is a great way to begin collecting your emissions data and get ahead of mandatory reporting.
- As S.E.C recommendations and global trends suggest that mandatory reporting for publicly traded companies is on the horizon, companies may be asked by a vendor to report to the CDP.
- If you are planning on making ‘net-zero’ commitments, we recommend disclosing your emissions data to a global repository like the CDP.
- If your clients or partners make ‘net-zero’ commitments, that may warrant your disclosing, in which case it is smart to familiarize yourself with the process.
Over 13,000+ companies and 1,110+ cities, state and regions disclose their emissions data to the CDP
What are the reporting requirements?
The CDP reporting process begins with a carbon footprint that tallies up your emissions data. After completing a carbon footprint and getting it verified by a third party, you complete the CDP questionnaire(s) and upload your disclosure to their platform. Depending on your industry, you may have additional modules to complete.
Getting an outside carbon assessment that has been verified by a third-party precludes reporting with the CDP. After getting your assessment, filling out the CDP questionnaire is the next step. The questionnaire is broken down into 15 modules ranging from emissions reporting, to value chain engagement and targets.
After responses have been submitted, the disclosure questionnaire is assessed and scored from an A to an F
CDP’s scoring measures “the comprehensiveness of disclosure, awareness and management of environmental risks and best practices associated with environmental leadership, such as setting ambitious and meaningful targets” .
Note: An ‘F’ indicates a failure to provide sufficient information to CDP to be evaluated for this purpose. An F does not indicate a failure in environmental stewardship.
How can Green Places help?
In order to report to the CDP, you need to be able to complete a carbon assessment, get that assessment verified by a third party, show your plan on how you’re reducing your emissions, and commit to reporting annually.
This is where Green Places can help. Our end-to-end sustainability software helps measure your carbon footprint and develop strategies to reduce emissions. By tracking this information, the Green Places platform makes reporting annually simple.
While sustainability requirements are complicated and new, Green Places is here to make this process seamless and straightforward.
If you have questions about CDP or climate reporting, reach out and we’re happy to help!