Climate change is spurring a “worldwide economic and industrial restructuring” that will “change the competitive playing field and financial performances of all companies,” concludes a survey released by the Carbon Disclosure Project (CDP).
The survey, which reached a high of a 77% response rate from the world’s largest 500 corporations, reveals they are beginning to move from awareness to action on global warming. European companies continue to lead, with 76% reporting they are actively reducing emissions, up from 47% in 2006; U.S. firms continue to trail with only 26% implementing active programs.
The CDP, a collaboration of 315 institutional investors with assets of $41 trillion under management, also published its first index, the Climate Disclosure Leadership Index (CDLI). It consists of companies that have the top carbon disclosure practices, including Rio Tinto, Iberdrola, Hewlett Packard, Westpac, Citigroup, Wal-Mart, Coca Cola, Wal-Mart, Royal Bank of Scotland, Allianz and Unilever.
Although fewer U.S. companies are seeing the opportunities inherent in climate change for their business, as evidenced by active programs, they do see the challenges. About 54% of U.S. multinationals are reporting on the challenges they face from climate change, even if they haven’t begun to act on it.
Paul Dickinson, CEO of CDP said: “Increasingly, investors view good carbon management as a sign of good corporate management. Our investors are using the quality of the disclosure as a very useful tool to assess how seriously a company is taking the issues of climate change.”
One of those companies, mega-retailer Wal-Mart, is working with the CDP to begin tracking the energy used to create products throughout its supply chain.
The pilot program will identify the overall environmental impact and look for innovative ways to drive energy efficiency in seven everyday product categories – DVD’s, toothpaste, soap, milk, beer, vacuum cleaners and soda.
“This is an important first step toward reaching our goal of removing non-renewable energy from the products Wal-Mart sells,” said John Fleming, executive vice president and chief merchandising officer, Wal-Mart Stores Division. “This is an opportunity to spur innovation and efficiency throughout our supply chain that will not only help protect the environment but save people money at the same time.”
“The partnership between CDP and Wal-Mart is a significant milestone in corporate action to mitigate climate change,” said Dickinson. “By engaging its supply chain in the CDP process, Wal-Mart will encourage its suppliers to measure and manage their greenhouse gas emissions, and ultimately reduce the total carbon footprint of Wal-Mart’s indirect emissions. We look forward to other global corporations following Wal-Mart’s lead and partnering with CDP.”
Other companies making major efforts include oil group Total, which plans to cut gas flaring in half by 2012, and Alcoa, which increased use of recycled aluminum 20% in 2006.
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