Maximising your 2019 CDP disclosure Carbon Credentials, CDP & Jupiter Asset Management 14 th February 2019 www.carboncredentials.com www.carboncredentials.com www.carboncredentials.com
Speakers Richard Tarboton Mark Evans Sonya Bhonsle Kesi Courtman Director of Strategic Analyst, Environment Global Head CDP Consultant, Services & Sustainability Supply Chain CDP Lead
Who we are Strategy Data Energy Performance People Clients 14% Integrity Savings Curiosity Excellence 41,000 buildings Data from over 60 Collaborative Asset countries Performance Programme 5
CDP from an investor perspective
IPCC Special Report on 1.5 o C The next ten years will be crucial to limit global temperature rise. Global CO 2 emissions will need to decline by 45% from 2010 levels by 2030, and reach net zero by 2050. SBTi supports the 1.5 o C aim and will be reviewing resources and target validation protocols.
Business as usual won’t cut it anymore Legal & General names, fames and shames corporate climate leaders and laggards
2018 CDP Results
Key trends in 2018 4% decrease 11% increase in number of UK in companies firms achieving an disclosing A grade 6% 11% 27% 4% 27% 0% 22% 2%
Key trends by sector
Maximising your 2019 CDP disclosure: Customer requests, scope 3 and the potential of supply chain February 13 th , 2019 Add your voice to the conversation #CDPSupplyChain SONYA BHONSLE Global Head of Supply Chain CDP @S_Bhon @CDP 10
Add your voice to the conversation: 11 11 #CDPSupplyChain | @CDP
2018 supply chain members
Your emissions are your customers scope 3 Add your voice to the conversation: 13 #CDPSupplyChain | @CDP
SC Member Request: Set a science based target This will have a ripple effect, cascading up and down our value chain, when customers use our energy efficient technology that is manufactured in factories with science-based targets, they will cut their own carbon emissions, achieving exponentially more with less environmental impact. Lara Birkes Vice president and chief sustainability officer for HPE 14
SC Member Request: More action on emissions 15 #CDPSupplyChain | @CDP
SC Member Request: Report emissions reductions Add your voice to the conversation: 16 Name | @Twitter #CDPSupplyChain | @CDP
SC Member Request: Report emissions reductions Add your voice to the conversation: 17 17 #CDPSupplyChain | @CDP
SC Member Request: Encouraging renewable energy purchasing “How will we meet our new supply chain target? Close cooperation with our 67.6% Our supply chain suppliers will be key. We will be 67.6% working together to help them switch 3: 1 6.7% BT’s end -to-end to renewable energy, and Our own carbon emissions 6.7% We will help As at 31 March operations encouraging more of them to report customers reduce 2017 We will help …BT’s end -to-end to CDP. This is a critical first step carbon by three 25.7% customers reduce carbon emissions times … Customer use towards action for suppliers, and the carbon by three 25.7% and disposal of times … data they disclose will enable us to track our products emissions reductions and uptake of renewable energy in our supply chain”. We will reduce the carbon emissions Gabrielle Ginér, Head of Sustainable Associated with our supply chain on Business Policy at BT Group 2016/17 levels by 29% by 2030
Renewables in the supply chain: new focus for SC members Significant consumption in tier 1 suppliers 62% of suppliers reported details of their energy consumption 27% of energy came from renewable sources Just 4% of suppliers report having a renewable energy target Only 83 committing to RE100 out of 5500 Add your voice to the conversation: 19 #CDPSupplyChain | @CDP
Covering more of the supply chain: The cascade… driving action throughout the value chain Retailers Consumer Goods Manufacturing base Add your voice to the conversation: 20 #CDPSupplyChain | @CDP
SC Member Request: engage your suppliers and take action on your upstream emissions We take this responsibility seriously and joined CDP Supply Chain as a founding member for climate, water and forests. This involvement has influenced the environmental performance of some of our most important strategic suppliers. Many are now engaging their own suppliers on these topics. Up from 23% in 2017 Alexandra Palt, Corporate Responsibility Officer, L'Oréal Add your voice to the conversation: 21 #CDPSupplyChain | @CDP
Integrating environment into business as usual We absolutely exit suppliers if they don't address environmental issues. We must take very serious measures. And the companies see who is no longer in the room. Signify Add your voice to the conversation: 22 Name | @Twitter #CDPSupplyChain | @CDP
Supply Chain Report Launch CDP Global Supply Chain Summit: 1.5days, 23+ speakers, 130+ attendees from Japan, Latin America, Europe and across the United States European Launch: 28 th February, London. Want to come? Contact CDP via supply.chain@cdp.net *Includes actions relating to CDP member collaboration and other initiatives Add your voice to the conversation: 23 23 #CDPSupplyChain | @CDP
Maximising Your CDP Disclosure
Common pitfalls in the 2018 disclosure cycle 1. Board-level buy in: Not having sufficient senior engagement on climate change 2. Targets: Not having robust targets aligned with science 3. Scope 3: Lack of transparency and control over scope 3 emissions 4. Risks & Opportunities: Insufficient understanding from senior stakeholders on climate-related risks & opportunities 5. Scenario Analysis: Insufficient scenario analysis embedded in the risk assessment process
Addressing these pitfalls Problem Action Quick Win Develop an engaging 1 Peer Review & Case for Board level buy-in strategy Change Target setting Develop science-based 2 Scope 3 Screening targets Scope 3 Risk & Opportunities Develop reporting 3 Risk & Opportunities against TCFD Workshop Scenario Analysis
Quick Win 1: Conduct a peer review and develop a case for change Quick Win Problem Action Develop an engaging 1 Peer Review & Case for Board level buy-in strategy Change
Quick Win 1: Conduct a peer review and develop a case for change Understanding your position relative to your peers is key to senior-level buy-in £ Science-based targets Engagement Roadmap Business case
Quick Win 1: Conduct a peer review and develop a case for change
Quick Win 2: Scope 3 Screening Problem Action Quick Win Target setting Develop science-based 2 Scope 3 Screening targets Scope 3
Quick Win 2: Scope 3 typically makes up >85%
Quick Win 3: Risks & Opportunities workshop Problem Action Quick Win Risk & Opps Develop reporting 3 Risk & Opportunities against TCFD Workshop Scenario Analysis
Quick Win 3: Conduct a Risks & Opportunities workshop with senior stakeholders Objectives of R&O workshop 1. Gather information to complete the CDP questionnaire (deadline is mid-August) 2. Develop a list of risks/ opportunities to support Prudential’s ongoing work to align with the TCFD recommendations Acc cceptable 3. Explore options for scenario analysis and discuss Imp Improve control meas easures whe here pr practicable le next steps Hig High ri risk. . Con Control mea easures to to be be implemented Una Unacceptable le ri risk. . Con Control meas easures to to be be implemented
CDP’s questions on risk represent a significant proportion of total points available No. Question Disclosure Awareness Management Leadership 1 Describe what your organization considers to be short-, medium- and long-term horizon 3 3 0 0 Select the option that best describes how your organization's processes for identifying, assessing, and 2 1 2 2 1 managing climate-related issues are integrated into your overall risk management. Select the options that best describe your organization's frequency and time horizon for identifying, and 3 2 2 2 1 assessing climate-related risks 4 Provide further details on your organization’s process(es) for identifying and assessing climate -related risks. 1 1 2 0 Which of the following risk types are considered in your organization's climate-related risk assessments? • 5 E.g. Current regulation, Emerging regulation, Technology, Market, Reputation, Acute physical, 5 5 5 1 Chronic physical 6 Describe your process(es) for managing climate-related risks and opportunities. 1 2 3 1 Provide details of risks identified with the potential to have a substantive financial or strategic impact on 7 12 12 15 3 your business. Provide details of opportunities identified with the potential to have a substantive financial or strategic 8 12 12 15 1.5 impact on your business. 9 Describe where and how the identified risks and opportunities have impacted your business. 5 5 5 1 Describe where and how the identified risks and opportunities have factored into your financial planning 10 7 3.5 3.5 1 process.
Task Force on Climate-Related Financial Disclosure
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