REELING IT IN: Many companies are doing more than ever to assess their direct climate impacts. Despite the progress, emissions from the world's most polluting corporations continued to swell according to a new survey by CDP, the Carbon Disclosure Project. Image: ThinkStock
The global economic recovery has produced mixed results for businesses trying to reduce their carbon footprints, according to the latest annual survey of some of the world's largest companies by the British nonprofit CDP.
While overall emissions of greenhouse gases from CDP's "Global 500" have shrunk from 4.2 billion to 3.6 billion metric tons of carbon dioxide equivalent since 2009, the index's 50 largest-emitting firms have actually seen greenhouse gas emissions rise by 1.65 percent over the same period, the organization has found.
And although many companies are doing more than ever to assess their direct climate impacts, CDP found that 47 percent of the most carbon-intensive activities undertaken by business -- called "scope 3" emissions -- continue to go unmeasured and unreported. These include things like investment activity, the use and processing of sold products, and the operation of franchises.
CDP, formerly the Carbon Disclosure Project, is one of the world's leading collectors and disseminators of business sector data on greenhouse gas emissions, and its annual "Global 500 Climate Change Report" has become one of the leading indicators of how corporations are responding to climate change.
The analysis is based on climate and energy data submitted by 389 companies listed on the FTSE Global 500 Equity Index. While previous indexes have mostly stressed progress made by some of the world's best-known brands in addressing the complex challenges around climate change, the latest report also sounds a cautionary note about how much more needs to be done to make meaningful change in the world's climate profile.
Can big emitters walk their talk?
"Many countries are demonstrating signs of recovery following the global economic downturn," Paul Simpson, CDP's chief executive officer, said in a statement. "However, clear scientific evidence and increasingly severe weather events are sending strong signals that we must pursue routes to economic prosperity whilst reducing emissions of greenhouse gases. It is imperative that big emitters improve their performance in this regard and governments provide more incentives to make this happen."
The report notes that three business sectors -- energy firms, utilities and materials companies -- account for 87 percent of scope 1 and 2 emissions, greenhouse gases that are directly emitted by a firm's activities, even though they account for less than 25 percent of all companies on the index. In fact, each of those three high-emitting sectors' scope 1 and 2 emissions are more than double the combined scope 1 and 2 emissions of all other sectors covered by the index, according to CDP.
And although companies are pledging to do more than ever to reduce emissions, "disparity [exists] between companies' strategies, targets and the emissions reductions" that climate scientists say will be necessary to limit the rise in average global temperatures to 2 degrees Celsius.
For companies that are leading the CDP index, the report's authors say they "demonstrate a strong commitment to managing their impact on the environment [and] are generating improved financial and environmental results."
Automakers lead reductions
This year's top index performers include a half-dozen automakers -- BMW AG, Daimler AG, General Motors Co., Honda Motor Co., Nissan Motor Co. and Volkswagen AG, with scores of 100 or 99 -- along with Royal Philips NV, Nestle SA, BNY Mellon Corp., Cisco Systems Inc. and Gas Natural SDG, all of which scored 100 points on the index.
Officials attributed the strong showing by auto manufacturers to general improvements in fuel economy as well as growing manufacturer investment in hybrid and electric-powered vehicles. Automakers also have become leaders in disclosing their climate impacts across their large and complex supply chains.