09 Jun The importance of CDP reports
Introduction
El “Carbon Disclosure Project (CDP)” es una organización internacional sin ánimo de lucro que ayuda a empresas, ciudades, estados, regiones y autoridades públicas a divulgar su impacto medioambiental. Por otra parte, la información sobre resultados extrafinancieros se refiere a la divulgación de datos no financieros por parte de las empresas, lo que proporciona una visión de las operaciones de una empresa más allá de las métricas financieras. Este artículo profundizará en la importancia tanto de CDP como de la información sobre resultados extrafinancieros.
What is CDP?
The CDP, formerly known as the Carbon Disclosure Project, is based in several countries, including the United Kingdom, Japan, India, China, Germany, Brazil and the United States. Its goal is to make environmental reporting and risk management a business norm, driving disclosure, knowledge and action towards a sustainable economy. In 2022 alone, nearly 20,000 organizations disclosed their environmental information through CDP.
CDP works with more than 18,500 companies and more than 550 cities and 100 states and regions to help them implement effective carbon reduction strategies. The data collected is self-reported by companies and is supported by more than 800 institutional investors with approximately $100 trillion in assets.
Why extra-financial performance reporting?
Extra-financial performance reporting provides stakeholders with a comprehensive view of a company's operations, beyond mere financial metrics. It includes information on a company's environmental impact, social responsibility initiatives, governance structures, etc.
This type of information is increasingly important as stakeholders demand greater transparency from companies. It enables them to make better informed decisions about their investments and partnerships.
The intersection between CDP and extra-financial reporting
CDP and extra-financial performance reporting intersect in their common goal of promoting transparency and accountability in corporate operations. Both aim to provide stakeholders with comprehensive information about a company's operations, beyond mere financial metrics.
CDP focuses specifically on environmental impact and helps companies disclose this information in a standardized way. This makes it easier for stakeholders to compare the environmental performance of different companies.
Extra-financial performance reporting takes a broader view, covering not only environmental impact, but also other non-financial aspects of a company's operations. This can include everything from social responsibility initiatives to governance structures.
Benefits of reporting with CDP
Reporting to the Carbon Disclosure Project (CDP) can bring several positive benefits to a company:
- Competitive advantage: Companies can gain a competitive advantage in going public, accessing capital and winning bids.
- Reputation management: Reporting environmental data through CDP enables companies to protect and enhance their reputation. They can build trust through transparency and respond to the public's growing environmental concerns.
- Identifying risks and opportunities: Companies can uncover emerging environmental risks and opportunities that would otherwise be overlooked by informing data-driven strategy.
- Regulatory compliance: In a world where mandatory disclosure is gaining momentum, disclosure through CDP helps companies stay ahead of regulations. With CDP, companies will be fully aligned with the best practice recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
- Benchmarking: Companies can track and benchmark their environmental performance against industry peers, with an internationally recognized sustainability score and feedback against their climate targets.
- Operational efficiency: CDP reports promote a system of transparency and sustainability disclosure, which can help organizations improve their brand reputation, increase operational efficiency and reduce operating costs.
These advantages highlight why more and more companies are choosing to disclose their environmental data through CDP.
Conclusion
In conclusion, both the CDP and extra-financial performance reporting play a crucial role in promoting transparency and accountability in corporate operations. They provide stakeholders with comprehensive information about a company's operations beyond financial metrics. As such, they are essential tools for driving sustainable business practices and responsible investment decisions.