CDP to incorporate the ISSB Climate-related Disclosures Standard into its global environmental disclosure platform:
CDP, the not-for-profit which runs the global environmental disclosure platform for corporations, and the IFRS Foundation have today announced that CDP will incorporate the International Sustainability Standard Board’s (ISSB) IFRS S2 Climate-related Disclosures Standard [IFRS S2] into its global environmental disclosure platform, in a major step towards delivering a comprehensive global baseline for capital markets through the adoption of ISSB standards. The Standard, currently being finalised, will be incorporated into CDP’s existing questionnaires, which are issued to companies annually on behalf of 680 financial institutions with over $130 trillion in assets.
CDP’s decision, a signal of its commitment to delivering robust environmental disclosure to the market, accelerates the early adoption of IFRS S2 disclosures, thereby providing investors with consistency of climate-related information they need sooner, and reducing the reporting burden on entities through an alignment of requirements.
Paul Dickinson, Founder Chair at CDP, said:
As the only global environmental disclosure platform, with over 18,700 companies worth half of global market capitalisation disclosing in 2022, CDP is uniquely positioned to scale the early adoption of the ISSB’s climate Standard across the global economy. This will be critical in boosting corporate action and accountability, providing financial markets, governments and regulators with clear, comparable data to inform their decision making.
Emmanuel Faber, Chair of the ISSB, said:
The ISSB is committed to delivering an effective, efficient disclosure eco-system for global capital markets, resulting in decision-useful climate-related disclosures. By aligning the CDP platform to the ISSB’s climate-related Standard, we are reducing the burden on entities and moving a step closer to that common language for disclosures. With the demand for robust disclosure as strong as ever, we are delighted that 18,000 preparers will be voluntarily disclosing data structured to IFRS S2 from the 2024 disclosure cycle.
By collecting this data, CDP will provide investors and other stakeholders access to corporate environmental information that is consistent, comprehensive and comparable across geographies. It will also reduce the reporting burden on companies. In turn, CDP will provide the IFRS Foundation with access to data on disclosures made against the climate standard for monitoring uptake and implementation of the standards and pursuing their continuous improvement.
Nicolette Bartlett, Chief Impact Officer at CDP, added:
As warnings of the closing window to avoid climate catastrophe grow louder, this global baseline standard for financial markets is an important step forward. It will not only further support companies and financial institutions to build resilience and adapt, as climate risk disclosure was found to do by the Intergovernmental Panel on Climate Change, but to further increase ambition and action. Disclosure is the bedrock of action: what we don’t measure we can’t manage. We live in a global world and need a global understanding of the risks we face, the solutions available, the progress made and the laggards holding us back. CDP is pleased to put our weight behind driving the implementation of this long-awaited global Standard.
To truly meet our global goals, it’s critical that this disclosure which focuses on climate-related financial risk is paired with disclosure that covers all corporate impacts on people and planet, beyond what is material to investors. CDP will continue to support companies to disclose this information, alongside what is required by this new investor-focused Standard. This is an important step in delivering our strategy of incorporating all high-quality global and jurisdictional-level standards, such as those being developed in the EU, the US and across the world.