CDP (Carbon Disclosure Project)
CDP is a global disclosure system that enables companies, cities, states, and regions to measure and manage their environmental impacts. CDP collects data on climate change, water security, and forests, making it available to investors, purchasers, and policymakers to drive environmental action.
CDP provides standardized questionnaires, scoring methodology, and a database of environmental data that is used by investors with over $130 trillion in assets to make informed decisions.
Global disclosure system for environmental data
Three questionnaires: Climate, Water, Forests
Scoring from A to D-
Used by investors with $130+ trillion in assets
CDP in 30 Seconds
CDP is a global environmental disclosure system
Covers climate change, water security, and forests
Standardized questionnaires with scoring
Data used by investors, purchasers, and policymakers
Over 18,000 companies disclose through CDP
Voluntary but widely requested by stakeholders
CDP provides the global system for environmental disclosure
What CDP Actually Does
CDP enables organizations to measure, manage, and disclose their environmental impacts through a standardized disclosure system.
Collect Environmental Data
Standardized questionnaires - consistent data collection
Three environmental topics - climate, water, forests
Annual disclosure cycle - regular data updates
Score and Assess
Scoring methodology - A to D- scale
Performance assessment - quality and completeness
Benchmarking - peer comparison
Distribute Data
Investor access - $130+ trillion in assets
Purchaser access - supply chain data
Public database - transparency and accountability
Drive Action
Investor pressure - disclosure requests
Customer requirements - procurement policies
Regulatory alignment - inform policy
CDP enables environmental disclosure and action
History & Background
CDP was founded to drive corporate environmental disclosure and has grown into the world's leading environmental disclosure system.
Founded in 2000
CDP was founded in 2000 as the Carbon Disclosure Project with the goal of encouraging companies to measure and disclose their greenhouse gas emissions. It started with a focus on climate change and has since expanded to water and forests.
Expansion of Scope
Over time, CDP expanded its scope beyond climate change to include water security (2010) and forests (2013), recognizing the interconnected nature of environmental challenges and the need for comprehensive disclosure.
Growth and Scale
CDP has grown significantly, with over 18,000 companies now disclosing through the system. The organization works with over 740 investor signatories and 280+ purchaser members, making it the largest environmental disclosure system globally.
Leading Environmental Disclosure System
CDP has become the global standard for environmental disclosure, driving transparency and action on climate change, water security, and forests.
Who Uses CDP
CDP data is used by a wide range of stakeholders to make informed decisions about environmental performance and risk.
Investors
Over 740 investor signatories with $130+ trillion in assets use CDP data to assess environmental risks, make investment decisions, and engage with companies on environmental performance.
Purchasers and Supply Chain
Over 280 purchaser members use CDP data to assess supply chain environmental risks, set procurement policies, and engage suppliers on environmental performance.
Cities and Governments
Over 1,100 cities, states, and regions disclose through CDP, using the system to measure environmental performance, track progress, and access climate finance.
Researchers and Policymakers
CDP data is used by researchers, academics, and policymakers to understand environmental trends, develop regulations, and inform policy decisions.
Multi-Stakeholder Use
CDP data serves multiple stakeholder needs, from investment decisions to supply chain management to policy development, driving environmental action across the economy.
CDP Disclosure System
CDP operates a standardized disclosure system with three main questionnaires covering different environmental topics.
Climate Change Questionnaire
Covers greenhouse gas emissions (Scope 1, 2, and 3), climate-related risks and opportunities, climate governance, strategy, and targets. Aligned with TCFD recommendations.
Water Security Questionnaire
Covers water use, water withdrawals, water discharge, water-related risks, water management practices, and water governance. Focuses on water stewardship.
Forests Questionnaire
Covers deforestation, forest-related commodities (timber, palm oil, soy, cattle), supply chain impacts, and forest management practices. Focuses on deforestation and forest degradation.
Comprehensive Environmental Coverage
CDP's three questionnaires provide comprehensive coverage of key environmental topics, enabling organizations to disclose their full environmental footprint.
Climate Change Questionnaire
The Climate Change questionnaire is CDP's most widely used questionnaire, covering greenhouse gas emissions and climate-related risks.
Emissions Reporting
Companies report Scope 1 (direct), Scope 2 (indirect energy), and Scope 3 (value chain) greenhouse gas emissions. Emissions are reported in metric tons CO2e and require calculation methodology disclosure.
Climate Risks and Opportunities
Companies identify and describe climate-related risks (physical and transition) and opportunities, including their potential financial impacts and adaptation strategies.
Governance and Strategy
Companies disclose their climate governance (board oversight, management responsibility), climate strategy (integration into business planning), and risk management processes.
Targets and Initiatives
Companies report climate targets (including science-based targets), emissions reduction initiatives, and participation in climate programs and initiatives.
TCFD-Aligned
The Climate Change questionnaire is aligned with TCFD recommendations, covering governance, strategy, risk management, and metrics and targets.
Scoring Methodology
CDP scores companies based on the completeness and quality of their disclosures, providing a benchmark for environmental performance.
Score Levels
- • A / A-: Leadership - demonstrating best practice
- • B / B-: Management - showing awareness and action
- • C / C-: Awareness - disclosing information
- • D / D-: Disclosure - providing minimal information
Scoring Criteria
Scores are based on the completeness of responses, quality of data provided, demonstration of governance and action, and evidence of environmental management practices.
Sector-Specific Scoring
CDP applies sector-specific scoring criteria to account for different environmental impacts and challenges across industries, ensuring fair and relevant assessment.
Performance Benchmarking
CDP scores provide a benchmark for environmental performance, enabling companies to assess their progress and compare with peers.
CDP Scores and Ratings
CDP scores are widely recognized as a measure of environmental performance and are used by investors and customers in decision-making.
Recognition of Leadership
Companies that achieve A or A- scores are recognized as environmental leaders. This recognition is valued by investors, customers, and other stakeholders as evidence of strong environmental management.
Investor Decisions
Investors use CDP scores to assess environmental risk and performance, often incorporating scores into investment decision-making and engagement strategies.
Customer Requirements
Many purchasers set minimum CDP score requirements for suppliers, using scores to assess supply chain environmental risk and select suppliers.
Market Signal
CDP scores serve as a market signal of environmental performance, influencing capital allocation and supply chain decisions.
How CDP Data is Used
CDP data is used by multiple stakeholders to drive environmental action and decision-making.
Investment Analysis
Investors use CDP data to analyze environmental risks, assess company performance, and make investment decisions. Data is integrated into ESG analysis and risk models.
Supply Chain Management
Purchasers use CDP data to assess supplier environmental performance, identify supply chain risks, and engage suppliers on environmental improvement.
Policy Development
Policymakers use CDP data to understand environmental trends, develop regulations, and track progress toward environmental goals.
Research and Analysis
Researchers and analysts use CDP data to study environmental trends, benchmark performance, and publish research on environmental issues.
Multi-Purpose Data
CDP data serves multiple purposes, from investment analysis to supply chain management to policy development, driving environmental action across the economy.
Key Financial Mechanisms
CDP disclosure affects companies and investors through specific financial mechanisms.
1. Investor Access Mechanism
CDP disclosure → Investor visibility → Capital access
2. Cost of Capital Mechanism
Better CDP scores → Lower perceived risk → Lower cost of capital
3. Customer Requirements Mechanism
CDP disclosure → Customer satisfaction → Revenue impact
4. Operational Efficiency Mechanism
Environmental management → Cost savings → EBITDA impact
Financial Outputs:
• Capital access - investor decisions based on CDP data
• Cost of capital - risk perception based on scores
• Revenue - customer requirements and preferences
• Cost savings - operational efficiency from environmental management
Real Financial Pathways
Capital Access Pathway
CDP Disclosure → Investor Data Access → Investment Decisions → Capital Allocation
Cost of Capital Pathway
High CDP Score → Lower Risk Perception → Lower Cost of Capital
Customer Requirements Pathway
CDP Disclosure → Supplier Selection → Revenue Impact
Operational Efficiency Pathway
Environmental Management → Resource Efficiency → Cost Savings
Regulatory Readiness Pathway
CDP Disclosure → Regulatory Compliance → Avoided Penalties
Impact on Business & Strategy
Operational Impact
Data collection, environmental management systems, resource efficiency
Strategic Impact
Environmental integration into strategy, risk management, innovation
Investor Impact
Enhanced investor confidence, access to sustainable finance
Competitive Impact
Market differentiation, brand value, customer preference
CDP drives environmental integration into corporate strategy
CDP transforms environmental disclosure from a reporting exercise into a strategic business function
Link to Financial Impact
Risk → environmental disclosure
Capital → investor decisions
Costs → environmental management
Value → competitive advantage
CDP is a key mechanism through which environmental performance becomes visible, measurable, and actionable in capital markets
CDP vs GRI
CDP and GRI serve different but complementary purposes in sustainability reporting.
Scope and Focus
- • CDP: Focused on environmental topics (climate, water, forests)
- • GRI: Comprehensive ESG framework covering all sustainability topics
Structure and Prescriptiveness
- • CDP: Standardized questionnaires with specific questions and scoring
- • GRI: Principles-based framework with flexibility in application
Scoring and Assessment
- • CDP: Provides scores (A to D-) based on disclosure quality
- • GRI: No scoring, focuses on disclosure completeness
Complementary Use
Many companies use both CDP and GRI. CDP provides detailed environmental data for investors and customers, while GRI provides comprehensive sustainability reporting for broader stakeholder communication.
Complementary Frameworks
CDP and GRI are complementary. CDP provides detailed environmental disclosure with scoring, while GRI provides comprehensive sustainability reporting. Companies often use both.
CDP vs Other Frameworks
CDP is one of several environmental disclosure frameworks, each with different approaches and uses.
CDP vs TCFD
CDP questionnaires are aligned with TCFD recommendations. CDP provides the detailed questions and data collection framework for implementing TCFD disclosures.
CDP vs SASB
CDP focuses on environmental topics with standardized questionnaires, while SASB provides industry-specific materiality frameworks for financially material sustainability topics. Both can be used together.
CDP vs CSRD
CDP is voluntary, while CSRD is mandatory. CDP questionnaires can be used to meet CSRD requirements, and CDP is recognized as an acceptable reporting framework under CSRD.
Framework Ecosystem
CDP operates within a broader ecosystem of sustainability frameworks. Companies should understand how CDP relates to other frameworks and use them in combination to meet stakeholder needs.
Challenges & Limitations
Complexity
CDP questionnaires are detailed and complex, requiring significant time and resources to complete accurately.
Data Availability
Collecting the data required for CDP disclosure, particularly Scope 3 emissions and water data, can be challenging for many companies.
Scoring Pressure
The focus on scores can lead to score-focused disclosure rather than meaningful environmental action, potentially undermining the purpose of disclosure.
Questionnaire Changes
CDP questionnaires change annually, requiring companies to stay updated and adapt their disclosure processes each year.
Focus on Substance
Despite challenges, CDP disclosure provides significant benefits. Companies should focus on substance and environmental action rather than just scoring.
Key Takeaways
CDP is a global environmental disclosure system
CDP covers climate, water, and forests
CDP scores from A to D-
CDP data used by investors with $130+ trillion in assets
Over 18,000 companies disclose through CDP
CDP is complementary to other frameworks like GRI
CDP drives environmental transparency and action
CDP Provides the Global System for Environmental Disclosure
CDP enables organizations to measure, manage, and disclose their environmental impacts, driving transparency and action on climate change, water security, and forests.