Customers, financial institutions, and B2B partners increasingly want to know more about the climate impacts of businesses and the strategies they employ to cope with emerging climate risks. But why? To better inform their own understanding of how they are linked to climate impacts and GHG emissions.
CDP, formerly known as the Carbon Disclosure Project, remains the world’s most-used and most-requested sustainable reporting tool. As the most commonly used voluntary disclosure system, CDP has taken steps to incorporate and align its questions with other leading reporting frameworks, lessening companies’ reporting burden. This interoperability is critical for companies facing diverse stakeholder pressure and drivers to disclose.
In fact, CDP has become so popular—there has been a 24% year-over-year increase in responses—and so many companies responded to last year’s questionnaire that there was a delay in getting scores out. CDP’s 2024 questionnaire is anticipated to be much different than years past, though it remains aligned with the Paris Agreement’s 1.5°C goal.
For 2024, CDP is creating an integrated questionnaire, merging the three environmental themes—water, forests, and climate, which were previously siloed across thematic questionnaires—into a single report.
Small and medium enterprises (SMEs) will also have their own separate questionnaire aimed at reflecting the different challenges and impacts to SMEs. CDP’s new questionnaire for 2024 is set to be released on April 30, 2024, with the portal officially open for disclosures from May 14 through September 18, 2024. CDP has also selected a new technology partner, which likely means online portal changes to the CDP platform. While partners and reporters anxiously await the unveiling, CDP has provided some preview videos. Once launched, all new CDP 2024 questionnaires will be available on the CDP Portal.
Alignment within and beyond CDP is what makes the 2024 questionnaire different
Reporting to CDP helps businesses manage, understand, and strategize their climate, water, deforestation, and other risks and environmental impacts. With the new 2024 questionnaire, reporting to CDP will also mean interoperability across different sustainability and climate reporting tools. Starting with CDP will help businesses expand their reporting horizons, enabling them to begin reporting and complying with new EU reporting requirements, like the CSRD.
CDP’s climate, water, and forest questionnaires will now work as one integrated questionnaire meant to create efficiencies across the governance, management, and strategy disclosures for each theme, allowing reporters to describe their sustainability program holistically while choosing which metrics and topics to include in their submissions.
Making reporting more streamlined within CDP isn’t the only advantage here. As the world’s most widely used sustainable reporting tool, CDP is making strides to make questionnaire interoperable with many other leading voluntary reporting frameworks, and some mandatory ones as well. Interoperability means companies will have fewer hurdles in committing to different sustainability reporting mechanisms. It also means less repetition and more opportunity to expand compliance across voluntary reporting frameworks and required reporting frameworks.
CDP is aligned with voluntary reporting frameworks, like the International Sustainability Standards Board (ISSB)’s S2 reporting on climate-related disclosures and the Taskforce on Nature-related Financial Disclosures (TNFD). It’s also interoperable with Europe’s required sustainability reporting via the Corporate Sustainability Reporting Directive (CSRD). At present, alignment for the new U.S. Securities and Exchange Commission (SEC) climate disclosures is pending. Each of these reporting tools involves different nuances to climate, nature, and sustainability reporting.
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2024 CDP questionnaire
In previous years, every company responded to the climate questionnaire as a baseline level of reporting. The additional questionnaires on water, biodiversity, plastics, and forests were considered optional for previous reporting. For the 2024 CDP Questionnaire, companies will be prompted to include responses on these additional thematic areas based on their responses and as it relates to their sector. CDP scores will continue to be released across the themes of climate, forests, and water specifically, but companies will be able to comply through a single report. While there will be questions on the new thematic areas of biodiversity and plastics via the climate questionnaire, respondents won’t get scores for biodiversity and plastics just yet.
Questions on forests and water will largely depend on how relevant these themes are based on a company’s sector and previous responses. The new CDP questionnaire will rely on the CDP’s Activity Classification System Methodology—the same scoring methodology CDP uses to identify reporting requests. From 2024, it will also be used to connect companies to the specific themes and indicators for reporting as they illustrate how aspects of the report are integrated with other environmental issue thematic areas are applicable within the questionnaire.
CDP’s new SME-dedicated questionnaire
CDP’s 2024 integrated corporate reporting tool will largely exclude small and medium enterprises (SMEs). Instead, SMEs will have their own simplified CDP questionnaire designed for them. More than ever, companies are requesting more information about their suppliers’ carbon footprint and climate impacts to understand and measure their own scope 3 emissions.
Today, SMEs account for 90% of all businesses, but many of these entities fall outside the thresholds for mandatory sustainability reporting. CDP’s new SME questionnaire will replace the minimal version of CDP’s corporate questionnaire as well as CDP’s pilot private markets SME questionnaire. This new questionnaire dedicated to SMEs builds off the SME Climate Disclosure Framework and previous CDP SME questionnaires.
Compared to CDP’s corporate questionnaire, these will be abbreviated to exclude some extraneous data points that is more applicable to larger companies. However, they will include some indicators on forests and water while specifying climate-related indicators. The SME questionnaire will be non-sector-specific but will encourage SMEs to consider their risk and climate impacts.
CDP questionnaires build business resiliency
Increasingly, investors, customers, and business partners want to know more about how companies are affecting the climate crisis (and how climate change affects them) and what they are doing to strategize around risks. Companies that address and track scope 1, scope 2, and scope 3 emissions will have a distinct advantage and opportunity to better manage business activities, risks, and net-zero strategies that can set them apart.
With interoperability in mind, it’s important to work with an accredited provider like Sustain.Life. It’s a must-have if companies want to gain a top rating for their 2024 CDP reporting and take full advantage of the voluntary sustainability interoperability opportunities. Sustain.Life is a trusted source for its audit-grade emissions calculations and sustainability reporting platform. It’s the leading technology companies utilize to meet the increasingly rigorous disclosure and transparency requirements.
Sources
1. CDP, “Rising disclosure numbers show more companies considering climate and nature impacts, but just under 400 reporting data aligned with CDP’s highest benchmark” https://www.cdp.net/en/articles/companies/scores-press-release-2023
2. CDP, “Environmental disclosure through CDP in 2024” https://www.cdp.net/en/2024-disclosure/
3. CDP, “Introducing the new CDP Portal” https://www.cdp.net/en/2024-disclosure/cdp-portal
4. Taskforce on Nature-related Financial Disclosures, https://tnfd.global/
5. CDP, “Corporate Disclosure: Key changes for 2024: Part I” https://cdn.cdp.net/cdp-production/comfy/cms/files/files/000/008/933/original/CDP_2024_corporate_disclosure_framework_-_headline_changes.pdf
6. CDP, “CDP’s Activity Classification System (CDP-ACS)” https://cdn.cdp.net/cdp-production/cms/guidance_docs/pdfs/000/001/540/original/CDP-ACS-full-list-of-classifications.pdf
7. CDP, “CDP SME corporate questionnaire” https://www.cdp.net/en/2024-disclosure/cdp-sme-questionnaire
