(Credit: Pixabay)Over 300 companies including AstraZeneca, Danone, Firmenich, HP Inc, KAO Corporation, Klabin S/A, Mars, Symrise AG, and Mitsubishi Electric have today been named on this year’s “A List” by environmental non-profit CDP. This is a major increase on last year, despite the unprecedented challenges posed by COVID-19.
The A List showcases the companies leading on environmental transparency and action, based on their annual disclosure through CDP’s climate change, forests, and water security questionnaires. Thousands of companies disclose through CDP at the request of investors and corporate buyers.
This year has seen a major increase (almost 45%) in the number of companies achieving an A score, with increases across all three themes that CDP assesses. Along with the high levels of disclosure, this shows growing environmental awareness among the business world in 2020.
For climate scores, this is largely because more companies are choosing to be transparent by disclosing data – in itself an important step, driven by increased market pressure for transparency. The growth in companies scoring an A for tackling deforestation and water security points to increased action in these areas, as the higher levels of disclosure do not fully account for the increase. Forests is particularly notable as the number of companies on the A List doubled from a low base (16 compared to 8 last year).
The A List comes just ahead of the five-year anniversary of the Paris Agreement, with world governments expected to deliver updates on their national climate plans to build momentum ahead of COP26. In November, the UK Government was the first G20 government to announce mandatory disclosure, sending a powerful signal to the market and other governments that they should follow the UK’s approach.
The number of companies achieving a triple A across climate change, forests, and water security, the highest rating CDP provides, has also grown to 10, up from 6 last year, the previous record. Symrise AG, Mondi Plc and KAO Corporation are among the new triple A Listers.
The A List companies hail from around the globe, with most coming from Europe (131), Asia (101) and North America (61). The top countries for A List headquarters are Japan (67), US (58), UK (21) and France and Germany (tied on 18). Last year Japan overtook the US and Asia overtook North America for the first time, with this solidifying further this year.
Examples of environmental action from the A List companies include:
Around half of the A List (more than 150 companies) are either new or returning, demonstrating that concrete environmental action continues apace this year despite 2020’s economic challenges.
While there has been a big increase in the A List this year, it still only represents a minority of companies. Most (74%) of companies scored by CDP achieved D-C scores, meaning they are only just starting their environmental journey and becoming aware of how environmental issues impact their business. Even more concerning, 3,700+ companies failed to disclose any data when requested by investors or customers, and over three times this many received an F for at least one theme. These companies are expected to face increasing pressure to demonstrate they are taking environmental risks seriously.
The companies are scored based on CDP’s transparent scoring methodology covering comprehensive disclosure of environmental impacts; risks; opportunities; governance and actions; awareness of environmental risks and how they relate to their business; demonstrating management of these environmental risks and evidence of best practice associated with environmental leadership.
