The latest insights from CDP, the global environmental disclosure system  

If water is the lifeblood that runs through our planet, then the world’s forests are its lungs. Both are vital to the living foundation that underpins our society and the global economy. This year’s World Water Day and International Day of Forests drove home the role of the private sector in shaping a more sustainable, deforestation-free and water-secure future. The climate crisis makes this even more urgent. Corporate action to protect water and forests makes business sense and is essential for climate leadership ahead of COP26. 

The collective effort to end deforestation: Only 1% of companies demonstrating ‘best practice’ 

In CDP’s latest Global Forests Report 2020, disclosing companies identified US$53 billion of risks from deforestation, such as increased severity of extreme weather and shifts in consumer preferences. The cost of addressing these risks is estimated at US$6.6 billion, showing a strong business case for action. However, with only 1% of companies currently demonstrating ‘best practice’, we need their peers to get on board to ensure a forest-positive future.

A wave of change: For water security, businesses cannot afford to wait 

Disclosures through CDP in the latest Global Water Report indicate the cost of inaction on water risks is up to five times the cost of action. While there has been corporate progress on reducing water use, action on water pollution remains stagnant. Companies are not doing enough to ensure water stewardship – they must put water at the heart of their business and take advantage of the financial opportunities of investing in water security, estimated at US$711 billion. 

Environmental progress must be explicitly anti-racist: An interview with Marilyn Waite 

The Black Lives Matter movement has brought into sharper focus the need to simultaneously address systemic racism, climate change and environmental destruction. Ateli Iyalla, (Managing Director, CDP North America) interviews Marilyn Waite, sustainability expert and Climate and Clean Energy Finance Program Officer at the William and Flora Hewlett Foundation, who talks about how environmental justice benefits all people and the importance of working in a connected way to solve multiple problems. 

Road to COP26 

The UN Climate Change Conference – known as COP26 – taking place in November of this year, is poised to be one of the most consequential climate events since the negotiation of the Paris Agreement in 2015. We have launched a new webpage that sets out key actions that governments, companies, capital markets, cities, states and regions can take to accelerate climate action ahead of the summit. To ensure success on the road to COP26, we need everyone to act now.   

Building Back Greener in India 

CDP’s Annual India Report finds that companies have upped their game on climate action, boding well for future-proofing India’s ambitious growth plans. For the first time, Indian companies have featured on the CDP A List and the first Indian company has disclosed on forests. Nevertheless, the country risks increasing its emissions due to its inconsistent policy pathway. 

Running hot: European companies currently on 2.7°C warming path 

New analysis from CDP Europe and Oliver Wyman has found a €4 trillion mismatch forming between ‘Paris-aligned’ bank lending and the market for corporate lending in Europe. Based on reported emissions targets, European companies are currently on a 2.7°C warming path by 2100 and less than 1 in 10 have emissions targets for well-below 2°C of warming. Therefore, banks financing these companies are far from Paris-aligned today. 

Addressing deforestation risks in China 

Chinese financial institutions play a crucial role in creating incentives for sustainable forestry through their investment and lending practices. A new CDP report finds that if deforestation is not addressed in these supply chains, China’s high dependency on imported forest-risk commodities threatens the stability of its food security, could potentially harm its economic growth and undermine its climate ambitions. 

How direct investor engagement drives corporate environmental transparency 

With the world’s largest investors increasingly recognizing climate change as a defining factor in companies’ future success, Emily Kreps (Global Director, Capital Markets, CDP) explores how investor engagement plays a critical role in enabling the real economy to accelerate climate action. 

When should organizations use climate-related scenario analysis? 

With climate change creating an increasingly unknowable future, how can businesses create long-term strategies? Amanda Tucker (Associate Director, Reporter Services, CDP North America) outlines how climate-related scenario analysis has emerged as an essential risk management tool and how companies can avoid common pitfalls in annual disclosures.