CDP Platform to Report Plastic-Related Impact, Issues Other Updates
The Carbon Disclosure Project (CDP) announced that its global environmental disclosure platform has enabled reporting on plastic-related impact for nearly 7,000 companies worldwide, published its response to the Intergovernmental Panel on Climate Change (IPCC) sixth assessment synthesis report, and a report on the 2022 supply chain emissions.
Below is a summary of the recent announcements:
- The online disclosure platform of CDP will enable companies to disclose information or data on the production and use of the most problematic plastics, that is, plastic polymers, durable plastics, and plastic packaging, which will be made available to the public from September 2023. Companies and investors face significant financial, physical, legal, technological, regulatory and reputational risks as a result of the plastic pollution crisis. In 2022, several large companies including Amazon, ExxonMobil and McDonalds faced shareholder petitions asking for more disclosures on efforts to reduce plastic waste. Through CDP’s disclosure platform, companies can accelerate plastic-related disclosure and access to data at scale. As mandatory environmental disclosure gathers momentum, CDP encourages governments to include plastics in their mandatory disclosure regimes.
- In its response to IPCC sixth assessment synthesis report, CDP highlights that the scenarios included in the synthesis report and its warnings are a direct result of a continued lack of ambition and most importantly, concrete action, from governments and corporates alike. Credible transition plans toward a net-zero future must include increasing and tracked adaptation measures if they are to be truly effective, alongside robust, science-based 2030 targets. Setting science-based climate targets and reporting environmental risks and actions is the best way for local governments to ensure they are reducing emissions and increasing resilience. CDP encourages policymakers to embed these practices into policies and regulation to ensure effective implementation of national commitments and action plans, and ultimately to rapidly decarbonize in the transition to a 1.5°C future.
- CDP published a report on 2022 supply chain that identifies data on companies that are falling behind on tracking supply chain emissions and risk missing completely mandatory regulation on nature in supply chains. The report highlights that less than half (41%) of companies disclosing to CDP are reporting on any of their supply chain emissions despite their impact significantly outsizing (11.4x) direct emissions. Nearly 70% of companies reported they do not assess the impact of their value chain on biodiversity despite fast approaching mandatory regulations on nature. Companies are not treating their impact on the environment as a whole, with most not engaging suppliers on climate and vital parts of nature, including water security, deforestation and biodiversity.
Keywords: International, Banking, ESG, Climate Change Risk, Environmental Risk, Supply Chain, Disclosures, Transition Risk, IPCC, CDP
Credit analytics expert helping clients understand, develop, and implement credit models for origination, monitoring, and regulatory reporting.
Hasan leads Moody’s Analytics ESG methodology development. He is expert on carbon transition, nature related risks and is a guest lecturer at ESSEC Business school on sustainable finance.
Michael Denton, PhD, PE
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
Previous ArticleCDP Reports Data on Corporate Sustainability, Issues Other Updates
ECB Finds Banks Unprepared for Pillar 3 Climate Risk Disclosures
The European Central Bank (ECB) published results of the 2022 supervisory assessment of climate-related and environmental risk disclosures among significant institutions (103) and a selected number of less significant institutions (28).
NCUA Assesses Credit Union Exposure to Climate-Related Physical Risks
The National Credit Union Administration (NCUA) released a Research Note that examines the exposure of credit unions to climate-related physical risks. In a related development
EBA Issues Multiple Regulatory and Reporting Updates for Banks
The European Banking Authority (EBA) is seeking comments, until July 31, 2023, on the draft Guidelines on the proposed common approach to the resubmission of historical data under the EBA reporting framework.
EC Adopts Regulation on Own Funds, Issues Other Updates
The European Commission adopted Delegated Regulations on own funds and eligible liabilities, on requirements for the internal methodology under the internal default risk model
IASB to Enhance Reporting of Climate Risks, Proposes IFRS 9 Amendments
The International Accounting Standards Board (IASB) updated its work plan to enhance the reporting of climate-related risks in the financial statements,
BIS Addresses Data Gaps and Macro-Prudential Policy for Climate Risks
The Financial Stability Institute (FSI) of the Bank for International Settlements (BIS) published a brief paper that examines challenges associated with the use of macro-prudential policies to address climate-related financial risks.
FCA Sets Out Business Plan, Launches TechSprint on Greenwashing
The Financial Conduct Authority (FCA) published its business plan for 2023-24. The plan sets out details of the work planned for the next 12 months to achieve better outcomes for consumers and markets
UK Committee Sets Out Recommendations for Next Phase of Open Banking
The Joint Regulatory Oversight Committee (JROC), comprising the Financial Conduct Authority (FCA) and the Payment Systems Regulator (PSR) as co-chairs and the HM Treasury and the Competition and Markets Authority (CMA) as members
ECB Publishes Multiple Regulatory Updates for Banking Institutions
The European Central Bank (ECB) published the results of the 2022 climate risk stress test of the Eurosystem balance sheet,
EC Consults on Environmental Taxonomy, Issues Other Updates
The European Commission (EC) is seeking comments, until May 03, 2023, on a new set of EU taxonomy criteria for economic activities that contribute substantially to environmental objectives.