The Climate Report - Winter 2011

Perhaps the most well-known source of data used by credit rating agencies, investors, and others to evaluate companies' climate-related performance is the set of reports compiled annually by the Carbon Disclosure Project ("CDP") from responses to CDP's climate change questionnaire. According to CDP, 534 financial institutions with assets of more than $64 trillion were signatories to the CDP 2010 information request, which was sent to more than 4,700 of the world's largest companies.

CDP's September 2010 report on the S&P 500 summarized responses from 70 percent of the S&P 500 companies (up from 66 percent in 2009), detailing climate change risks and benefits, including how they plan to capitalize on commercial opportunities related to climate change. In addition, 59 percent of the S&P 500 companies (up from 52 percent in 2009) disclosed their carbon emissions, at least in part.

The 2010 CDP report notes that the demand for CDP's carbon performance data continues to grow and is now accessed through Bloomberg and Google Finance. The report includes a new performance score evaluating leadership in managing carbon risk and exposures, and asserts that large U.S. companies lag behind the Global 500 peer group, in which three times as many companies score high enough to be recognized as carbon performance leaders.

CDP has also launched two index products designed to identify companies well-positioned for a transition to a low carbon economy—the FTSE CDP Carbon Strategy Index series and the Markit Carbon Disclosure Leadership Index.

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