Allianz, AXA and BNP Paribas are among 680 financial institutions that have asked nearly 10,400 companies with $105trn (£80.4trn) in combined market capitalisation to disclose environmental data through CDP this year.
Almost 100 more financial institutions put their name to CDP's disclosure request this year than in 2021, bringing their combined assets under management to over $130trn.
Letters sent out yesterday requested that companies disclose how their operations impact climate change, deforestation, and water security. This includes over 3,300 firms being asked to disclose data for the first time – marking a 46% increase from last year.
Since the first disclosure request in 2002, CDP has grown to house the world’s largest global repository of environmental data, and aims to cover 90% of the world’s highest-impact firms by 2025.
“While many companies are disclosing, setting targets and taking action across their own business operations and value chains, there is a surprisingly large part of the market still to take the vital first step of disclosure,” said CDP CEO Paul Simpson.
“These companies are becoming increasingly out of touch with reality, investor and public opinion, not just because of the regulatory stick that is approaching, but also because there are so many proven benefits to transparency.
“We hope that this request, backed by such an influential group of financial institutions worldwide, will hit home and drive transparency and action even further.”
Nearly 3,200 companies disclosed their environmental information in response to CDP’s letter last year, while over 10,100 others disclosed at the request of their business customers, or of their own volition.
This means that over 13,000 firms representing some 64% of global market capitalisation disclosed their data through CDP in 2021
However, nearly 4,000 companies – including Berkshire Hathaway, Chevron, Exxon Mobil and Glencore – failed to respond to the request for disclosure from financial institutions last year.
Non-disclosure will no longer be an option for many of these companies, with a series of mandatory environmental disclosure requirements coming in this year, including in the EU, Japan, New Zealand and India, as well as TCFD regulation being introduced in the UK from next month.
“We need this comparable, consistent and clear data for our investment decision making, our research, our product development, our corporate engagement and our regulatory compliance,” said Jean-Jacques Barbéris, ESG Supervisor at Amundi.
“It is also vital for us to meet our own climate goals. But crucially, we don’t just need data on climate, we also need more information on other areas of natural capital, and we must ensure that this is incorporated in what companies disclose and take action on going forward.”
Image credit: iStock
Author: Chris Seekings