CDP Workshop Name of presentationecodes.org/documentos/CDP_2.pdf · 1. Governance 2. Strategy 3....

April 2012 CDP Workshop

Name of presentation

Name of presenter

CDP Workshop

April, 2012 Spain


Outline

1. CDP Overview

2. Questions for 2012 and main changes from 2011

3. Reporter Services



Name of presenter

1. CDP Overview


Mission

• CDP‘s mission:

―to accelerate solutions to climate change and water management by putting relevant information at the heart of business, policy and investment decisions‖

• CDP is the global standard for measurement and reporting of climate change information

• Annual climate change information request

• Investors • Purchasing organizations • Governments

―The work of the Carbon Disclosure

Project is crucial to the success of

global business in the 21st century. No

other organization is gathering this type

of corporate climate change data and

providing it to the marketplace.‖

Ban Ki Moon

Secretary General of United Nations


―CDP is to the future of business what

the X-ray was to the then-future of

medicine — without it, we would never

have seen the insides of the patient's

health.‖

Christiana Figueres

Executive Secretary of the UN

Framework Convention on Climate

Change (UNFCCC)

Responders (Investor & Supply Chain programs)

2003 2004 2005 2006 2007 2008 2009 2010 2011

235 295 355

922

1449

2204 2456

3050

3715

CDP over time

0

100

200

300

400

500

600

700

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

35

95

155

225

315

385

475

534 551

655

4.5 10 21 31 41 57 55 64 71 78

Signatory Investors Assets ($ Trillion)


Our activites in Spain

• Our strategic partners are:

• CDP request carbon disclosure from the largest 85 companies by market capitaliation

• CDP request water management discloser from the 4 companies in water intensive sectors:utilities, energy and consumer discretionary

• Signatory Investors:

BBVA Bankia Banco Santander Banco Popular

Mapfre Bankinter CaixaBank Banesto

Banco Sabadell Banca Civica

Iberian Scoring partner Iberian Report writer


655 Institutional Signatory

Investors in 2012

3,700+ Number of Companies

reporting via CDP in 2011

$78T AUM represented by

CDP‘s signatory

investors in 2012

Proportion of Global 500

companies reporting via CDP in

2011

Proportion of Euro 300 companies

reporting via CDP in 2011.

50 CDP Supply Chain

Members in 2011

Proportion of Iberia 125 companies

reporting via CDP in 2011

Key figures for CDP

90%

81%

40% 4911 Number of companies

asked to respond to

Investor CDP 2012


SIGNATORY

INVESTORS

REQUESTING

SC/PP MEMBER

THOMSON

REUTERS

GOOGLE

FINANCE

CDP

WEBSITE

CDP

ANALYTICS

OTHER INVESTORS DISCLOSING COMPANIES YOUR CUSTOMERS GENERAL PUBLIC OTHER PUBLICATIONS

PUBLIC RESPONSES/ SCORES

CDP

REPORTS

BLOOMBERG SUSTAINABILITY

INDICIES

NON PUBLIC RESPONSES

SIGNATORY

INVESTORS

REQUESTING

SC/PP MEMBER

What happens to the information?

Aggregate data

and published

scores only


CDP DATA

INVESTORS

DISCLOSING COMPANIES

PROCURING ORGANISATIONS

POLICY ACTORS

ACADEMICS

Understanding

the environment

in which policies

are designed

Informing

procurement

decisions

Benchmarking,

informing strategy

& learning from

best practice

Building

knowledge in

the areas of

management,

accounting,

and policy

Engaging with companies

and incorporating data

Into financial models

Data users helping CDP achieve its mission

Buy side

• Engagement with investee companies (Robeco, Hermes)

• Voting on shareholder resolutions (CalSTRS, Aviva)

• Exclusion criteria (Pax World Investments)

• Rank, score and screen companies (SWIP, Calvert)

• Analysis of carbon sensitivity of portfolios (Calvert, NEI

Investments, Caisse de dépôt, Generation IM, Nordea)

• Carbon trading risk analysis (SWIP)

Sell side

•Broker recommendations (Société

Générale)

•Investment research (Cheuvreux)

•Peer and sector analysis (Goldman

Sachs)

•Creation of financial products (i.e. ETF

Nedbank)

Investment advisors

• Investment research

• Risk models, sector analysis,

country risk profiles

Index providers

•Markit Carbon Disclosure Leadership

index

•FTSE CDP Carbon Strategy Index

•BNEF Global Corporate Renewable

Energy Index 2011

Data providers

•Integrate CDP data with financial

data (Bloomberg, Thomson Reuters)

•Rank, score and screen

companies (Bloomberg)

CDP

DATA

Research providers (e.g. EIRIS,

Trucost, MSCI ESG, Sustainalytics)

•Investment research

•Engagement with companies on

behalf of investors


CDP data in Bloomberg: Equity screening- possible research

criteria based on CDP Data


Fundamental Analysis of Individual Stocks: Page 1

(Reporting Period, Risks & Opps, GHG Emissions)


Fundamental Analysis of Individual Stocks:

Details of the Response – Example: Regulatory Risks


Fundamental Analysis of Individual Stocks: Page 2

(GHG Emissions, Energy Use, Emissions Trading)


Fundamental Analysis: Historical Development: Page 1

(CDLI Score, Survey & Reported Year, Emissions)



CDP scores in Google Finance


The Markit Carbon Disclosure Leadership index family tracks the

performance of companies according to the CDP annual scores


The FTSE CDP Carbon Strategy Index Series aims to support investors

in incorporating climate change risks into their investment strategy


Carbon Action

• Investors are requesting companies in the high emitting industries in G500 and FTSE

AllWorld-800 to implement cost-effective greenhouse gas emissions reductions to be

communicated through question 3 and question 13 in the 2012 Investor CDP information

request.

• Specifically companies are being encouraged to:

• Make year-on-year emissions reductions;

• Identify and implement investment in greenhouse gas emissions reduction initiatives which

have a satisfactory positive return on investment;

• Any companies that do not already have an emissions reduction target are asked to set and

publicly disclose this.

• Companies in the G500 and FTSE AllWorld-800 in industries with potential for high

emissions in their supply chains are also asked to demonstrate their management of those

emissions.



Name of presenter

2. Questions for 2012 and main changes from 2011


Core modules and pages

Management

1. Governance

2. Strategy

3. Targets & Initiatives

4. Communications

Risks & Opportunities

5. Climate Change Risks

6. Climate Change Opportunities

Emissions

7. Methodology

8. Emissions Data

9. Scope 1 Emissions Breakdown

10. Scope 2 Emissions Breakdown

11. Scope 2 – Contractual

12. Energy

13. Emissions Performance

14. Emissions Trading

15. Scope 3


4. Communications

Management

1. Governance

2. Strategy

• Responsibility for climate change

• Reward structure

• Risk Management Process

• Integration with business strategy

• Engagement with policy makers

• Focus mostly on qualitative data

• Aims to determine the carbon management processes your

company has in place and identify best practice activities.

Scoring Tip:

Remember scorers and data users

may not be intimately familiar with

your company. It will help if you use

internal jargon free language that

everyone could interpret.


• Outside the CDP response (no URLs!)


Management


―The questions take you

through and say ‗do you

have environmental

performance targets?‘. We

didn‘t but we do now‖

Mary Armstrong

Vice President for

Environment, Health and

Safety

Boeing

Emission reduction targets

• Absolute and/or intensity targets with details • Scope 3 categories updated (GHGP standards) • Progress within the reporting year

Enabling third parties to reduce emissions

Emissions reduction initiatives

• NEW: Number of projects at each stage of development and estimated annual CO2 savings

• Details on implemented initiatives: estimated CO2 and monetary savings, payback period, investment required

• Methods for driving investments for emission reduction initiatives

Key Changes for 2012:

New Question Q3.3a: ― Please

identify the total number of projects

at each stage of development, and

for those in the implementation

stages, the estimated CO2e

savings.‖

Scope 3 drop downs: updated

Scoring Tips:

- 3.3a will not be scored to allow companies to adapt their reporting practices.

-Getting points for describing carbon saving initiatives (Q3.3b) is tougher than

2011. Twice as many performance points are available.

! Carbon Action Initiative


Risks & Opportunities

5/6. Climate Change Risks/Opportunities

―We have used CDP as the

main tool to drive carbon

reporting right across our

organization. It has been

really fantastic for us. We‘ve

discovered cost savings and

we have probably saved ten

million [pounds in various

ways‖

Andy Green

CEO, Logica

• Analysis of climate change risks and opportunities

• Based on inherent not residual risk/opportunities

• If not relevant, you are asked to explain why –

disclosure points

Risks and Opportunities driven by

• Regulation

• Physical climate parameters

• Other climate related development

Further Details

• risk drivers, potential impact, timeframe, direct/indirect,

likelihood, magnitude of impact

• the potential financial implications of the risk before

taking action;

• the methods you are using to manage this risk and

• the costs associated with these actions


- No question changes

- Additional guidance provided.

Scoring Tip:

This section is worth up to 1/3rd of

your disclosure score. Even if you

haven’t identified risks or

opportunities, you are scored for your

explanation for why not.


Emissions

7. Methodology

• Scope 1 & Scope 2 base year emissions (metric

tonnes of CO2)

• Name of the standard, protocol or methodology you

have used to collect activity data and calculate

emissions

• The source for the global warming potentials you have

used

• The emissions factors you have applied and their

origin


No question changes

Additional guidance provided

Scoring for Emissions Module:

Key areas for improvement;

- Verification of Scopes 1, 2 & 3

- Scope 3 emissions inventories

and reductions

- Q13.1a – demonstrating absolute

carbon reductions


Emissions

8. Emissions Data

• The boundary you are using for your Scope 1 and 2

greenhouse gas inventory.

• Scope 1 and 2 emissions in figures in line with the

boundary given.

• The level of uncertainty of the total gross global Scope

1 and 2 emissions figures that you have supplied and

specify the sources of uncertainty.

• Verification/assurance status that applies to your

Scope 1 and 2 emissions.


No question changes

Additional guidance provided


Emissions

8. Emissions Data

CDP is committed to increasing the number of verified data submissions, and encourages

verification.

Why is it important?

• Meeting the market demand

• institutional investors, global prospective buyers,

• market mechanisms: EU ETS, Californian Air Resources Board, Tokyo’s metropolitan

trading scheme, Australia’s Clean Energy Package

• Improving external perceptions

• Recognition through CDP scoring methodology, and Dow Jones Sustainability Indexes.

• Continued improvements: enhancing processes and gaining competitive advantage

What does a company need to consider around verification?

• CDP paper on ―Verification of climate change‖

• https://www.cdproject.net/en-US/Respond/Pages/verification.aspx

Verification


• Attach third party verification/assurance statement (e.g. PDF, letter from verifier, CDP template verification statement available on Guidance webpage). Note: website links will NOT be taken into account (in certain circumstances screenshots will be accepted – e.g. EU ETS database)

• Documentation needs to:

1. relate to the relevant scope;

2. clearly state the type of verification/assurance that has been given and the standard used**;

3. cover the current reporting year.

** Standard used needs to comply with CDP criteria – see list of accepted standards at https://www.cdproject.net/en-US/Respond/Pages/verification-standards.aspx.

• CDP accepts verification under way, so long as the previous verification/assurance statement is attached as proof of process.

Scoring Tips:

- Documents should be referencing

a verification protocol, NOT a GHG

calculation protocol.

- Make sure the documents for the

reporting year are attached.

CDP Verification Template:

CDP produced a CDP verification

template to be completed by the

verifiers as a replacement for the

standard verification statement as

evidence of verification completed.

This is to allow for verifiers whose

standard assurance statement

does not cover the points

requested by CDP to demonstrate

how the reporting company has

met those requirements and allow

them to gain appropriate credit.

Verification requirements – to get full points

https://www.cdproject.net/en-US/Respond/Pages/verification-standards.aspx






Verification Case Study – Baxter International


Emissions

9/10. Scope 1 and Scope 2 Emissions Breakdown

11. Scope 2 – Contractual

12. Energy

• Aim to identify the degree to which activities are sensitive to energy costs and

energy supply.

• Details on scope 2 emission calculations:

purchased energy emissions factors vs. grid average

• Details on certificates, associated with zero or low carbon electricity

• Country level data is useful for investors:

As this is the level at which emissions-related legislation is introduced

• Further breakdown by (i) business division, (ii) facility, (iii) GHG type, and (iv) activity


• How absolute emissions (Scope 1 and 2 combined) for the reporting year compare to the previous year.

• Change in gross combined Scope 1 and 2 emissions in metric tonnes CO2e

• Per unit currency total revenue

• Per full time equivalent FTE employee

• An additional intensity (normalized) metric that is appropriate

to business operations.

Emissions

13. Emissions Performance

Scoring Tips:

- So many performance points are

available !

- It should tell us how your actual

figures compare across years -

NOT pro-rated or averaged

- The same boundary reported at

8.1 should be used.



Emissions

14. Emissions Trading

• Participation in existing trading schemes • allowances allocated/purchased

• verified emissions

• details of ownership

• Originated/purchased any project based carbon credits:

• Certified Emission Reductions (CERs) generated by activities under the Clean

Development Mechanism (CDM);

• Emission Reduction Units (ERUs) generated by activities under the Joint Implementation mechanism;

• Voluntary Emission Reductions (VERs) generated by activities that reduce emissions, but do not result in the creation of compliance-grade carbon units.


Emissions

15. Scope 3


- Scope 3 categories amended to

align with the new standard.

- Q15.3 and Q15.3a – amended

Scoring Tips:

- New scoring reflects the recent

publication of the GHG protocol for

Scope 3.

- CDP want companies to identify

the most relevant Scope 3

categories, so you only need to

quantify the most relevant

categories to get full marks in 2012.

- CDP does not specify which

categories –it is up to the

responders to select which is most

relevant for their company

• WRI and WBCSD produced ―Corporate Value Chain (Scope 3) Accounting and Reporting Standard.‖

• Relevant Scope 3 emissions

• Sources of Scope 3 emissions

• Quantify – in metric tonnes CO2e

• Methodology used

• If you can’t quantify, provide a description

• Verification/assurance status

• Changes in Scope 3 emissions on a year-on-year basis

by Scope 3 category.




Name of presenter

3. Reporter Services


Membership programme which is

designed to support your carbon

management process and help you

achieve your carbon goals

Package has 5 elements

• CDP Analytics

• Emissions Reporting Tool

• CDP Insights

• Account Manager

• Response Check

Fast growing with 55 members in

more than 10 countries

Email: [email protected] to schedule a

personal presentation tailored to your needs

CDP Reporter Services

mailto:[email protected]


CDP Analytics

• Benchmark against CDP’s global dataset

• Powerful search filters — geography, index,

sector or company

• Turn CDP data into valuable information to

drive internal action

• Simple to use with pre-defined reports

Emissions Reporting Tool

• Move from spreadsheets to web-based

carbon management tool

• Visualize GHG data and trends

• Organize data according to your business

structure – divisions, facilities, assets and

geographies

• Identify hot spots for reductions

CDP Reporter Services – Software Solutions


CDP Insights

• Webinar series – engage with carbon experts

• Share best practice with other members

• Roundtable discussions using TelePresence™

• Exclusive newsletter and website

Response Check

• Response Check is included in member package

• Ensure your response data is complete

Account Management

• Build a stronger relationship with CDP

• Support for the response process

• Support for the software tools

CDP Reporter Services



Name of presenter

All assistance material is available at https://www.cdproject.net/en-US/Pages/Guidance.aspx

Or contact us: [email protected]

https://www.cdproject.net/en-US/Pages/Guidance.aspx



mailto:[email protected]

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