Less than 2% of companies get A grade on climate crisis disclosures

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According to a global study of more than 13,000 firms, the number of companies considered leaders on climate crisis action and transparency has declined sharply this year.

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Just 200 companies – less than 2 percent of those who provided information – received an A grade for their climate impact mitigation measures, down from 280 last year.

Close to 5,000 was given an F grade, the lowest possible score.

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Fourteen companies were selected for special praise, including L’Oreal and consumer goods giant Unilever, which owns hundreds of brands including Ben & Jerry’s, Domestos, and Dove. AstraZeneca and Colgate Palmolive also scored well.

More companies than ever provided information for the annual study by the CDP, a non-profit organization that runs the system through which companies publicly report their environmental impact.

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The CDP said that the companies that accounted for 64 percent of the market capitalization of all businesses globally.

However, about 17,000 businesses worth $21 trillion failed to provide even basic information. Some of them were the world’s biggest polluters, including Chevron, Exxon Mobil and commodities giant Glencore. Warren Buffett’s Berkshire Hathaway, which has investments in coal, also failed to disclose.

“17,000 corporates have failed to take the first step and report their environmental data,” said Dexter Galvin, global director of corporations and supply chains at CDP.

“These companies are putting not only the planet at risk, but themselves as well. If they continue doing business as usual, they will end up on the wrong side of public opinion, regulation and investor sentiment. And increasing scrutiny. The empty target or the greenwash just won’t fly.”

The number of top-scoring firms has declined partly because the bar for qualifying as climate leaders has been raised, the CDP report said.

Most of the low hanging fruits at the disposal of companies have now been tapped and more ambitious action is urgently needed.

To score an A, companies had to demonstrate “robust governance and monitoring of climate issues, and rigorous risk management practices”. They also have to reduce emissions in their supply chain.

Public disclosure is seen as an important step towards tackling the climate crisis and other environmental issues such as deforestation and water security. Without transparency it is impossible for investors to assess the risks faced by companies and move their money accordingly.

Environmental disclosures came under scrutiny at the COP 26 climate summit in Glasgow last month. The UK announced that most large firms and financial institutions will be required to disclose how they will be affected by climate risks. Campaigners argued that the measures did not go far enough.

The CDP report highlighted companies that were making a positive impact on environmental issues, such as the IT company Fujitsu, which works with organizations across Asia to manage the response to a growing number of natural disasters.

The Jakarta State Disaster Prevention Bureau uses Fujitsu’s Disaster Information Management System to respond to areas in need.

Property developer Landsec has established a voluntary intrinsic value for carbon that is above the market rate as a way to steer its business toward activities less harmful to the climate.

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Credit: www.independent.co.uk /

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