Carbon Disclosure Project (CDP) | Carbon Reporting

Carbon Disclosure Project (CDP)

In the pursuit of a sustainable and low-carbon future, organizations worldwide are turning to initiatives such as the Carbon Disclosure Project (CDP) to mitigate their environmental impact. By shining a light on vital metrics, the CDP catalyzes transparency and helps to drive responsible business practices - here, Minimum explains how.

What is the CDP?

The Carbon Disclosure Project (CDP) is a globally recognized non-profit organization that operates a platform for organizations to measure, disclose, manage, and share vital environmental data. By facilitating comprehensive disclosure, the CDP enables stakeholders to:

Assess environmental risks and opportunities
Make informed investment decisions
Drive sustainable business practices

The CDP's mission is to accelerate the transition to a low-carbon and sustainable economy by providing a global system for organizations by awarding them a CDP score.

What is a CDP score?

A CDP score refers to the performance rating assigned to companies based on their environmental disclosure and management practices as reported through the Carbon Disclosure Project (CDP) questionnaire. The score provides insights into how well an organization is addressing environmental risks, managing emissions, and implementing sustainable practices.

Widely recognised by investors and customers alike, CDP scores range from A to D- based on the quality and comprehensiveness of the company's disclosure and performance, with each having different scores:

Disclosure

The Disclosure Score reflects the extent to which a company provides comprehensive and transparent information on its carbon emissions and climate-related initiatives. It assesses the company's reporting practices, data quality, and transparency in disclosing carbon-related risks and opportunities.

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Level A	Companies at this level exhibit excellent transparency and disclose highly comprehensive and detailed information on their carbon emissions and climate-related activities.
Level B	Companies at this level demonstrate good transparency and disclose comprehensive data on their carbon emissions and climate-related initiatives.
Level C	Companies at this level provide basic information on their carbon emissions but may lack comprehensive data or transparency in reporting.
Level D	Companies at this level do not disclose any information related to their carbon emissions or climate-related activities.

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Performance

The Performance Score assesses the company's actual environmental performance and progress in reducing carbon emissions. It takes into account factors such as emissions reduction targets, renewable energy usage, energy efficiency measures, and overall climate change strategy.

Companies are given a score that reflects the completeness of their disclosure and also partially how well the companies are performing environmentally - the more complete the questionnaire, the higher the score.

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Level A	Companies at this level exhibit exceptional performance in managing and reducing their carbon emissions, often exceeding industry standards and best practices.
Level B	Companies at this level have achieved notable progress in reducing carbon emissions and demonstrate a strong commitment to sustainability.
Level C	Companies at this level have made significant efforts to reduce their carbon emissions and demonstrate a good overall performance.
Level D	Companies at this level have initiated some measures to reduce carbon emissions but have not achieved substantial progress.
Level E	Companies at this level have not taken significant actions to address their carbon emissions or have minimal progress in reducing their environmental impact.

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Who has to report to the CDP?

Reporting to the Carbon Disclosure Project (CDP) is voluntary, but it is encouraged for companies, cities, states, regions, and other organizations that aim to measure, disclose, manage, and improve their environmental performance.

What are the requirements?

The specific requirements for reporting to the Carbon Disclosure Project (CDP) may vary depending on the type of organization and the specific questionnaire they choose to respond to. However, there are general guidelines and expectations set by the CDP for reporting entities:

Greenhouse Gas Emissions - companies are required to report their greenhouse gas emissions, including Scope 1, Scope 2 and Scope 3 emissions.
Climate risk and opportunity assessment - companies must assess and disclose climate-related risks and opportunities, considering factors such as physical risks, regulatory changes, and market shifts.
Emissions targets - companies have to report on their emissions targets and their actions and progress against these.

It is important to note that the CDP periodically updates its reporting requirements and questionnaire frameworks to align with evolving sustainability standards and best practices.

It’s also worth noting that companies need to measure Scope 1, 2 and 3 emissions accurately on a yearly basis and implement actions to mitigate risks. There is a very specific emphasis on accurate data collection, validation, and verification processes to ensure the credibility of reported information too.

That’s why it’s best for organizations to be on the front foot when it comes to understanding their carbon footprint, so that they’re better prepared for any changes in regulation.

What are the benefits of adhering to the CDP?

Adhering to the Carbon Disclosure Project (CDP) and actively participating in its reporting process can bring several benefits to organizations. Here are some key advantages:

Enhanced sustainability performance
Access to capital
Improved risk management
Regulatory compliance
Stakeholder expectations

Minimum can help organizations to understand their existing carbon output, and create plans to mitigate climate related risks in the future. Our Emissions Data Platform seamlessly collects and processes emissions data from every corner of your organization and supply chain - no matter the format. Making it the ideal platform for emissions audits and all-round business intelligence.

Learn more about how Minimum's Emission Data Platform can help to power you all the way to Net Zero today.

FAQs about the carbon disclosure project

Are CDP reports publicly available?

CDP publishes reports and analysis based on the aggregated data it receives from participating organizations. However, individual company responses are typically kept confidential.

How often does the CDP reporting cycle occur?

The CDP operates on an annual reporting cycle.

Does the CDP provide guidance or support for reporting?

Yes, the CDP offers guidance and support through its reporting framework, questionnaires, and resources. Organizations can access templates, guidance documents, and webinars to help them understand and meet the reporting requirements.

Yannick Pape

Yannick is a Sustainability Consultant at Minimum. A graduate of Imperial College London, Yannick holds a Masters Degree in Climate Change, Management and Finance, and was previously a Sustainable Finance Consultant at South Pole.

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