The number of financial institutions requesting corporate environmental disclosure has increased to a record level of 57%, with 263 participants this year compared to 168 in 2021, according to the environmental disclosure system CDP.
This marks a new milestone in participation for CDP’s 2022 Non-Disclosure Campaign, which aims to increase environmental disclosure among companies that have either never disclosed, or stopped disclosing, through CDP.
The campaign has seen an average 38% year-on-year growth in participation from financial institutions since its inception in 2017, reflecting the momentum of net-zero target setting.
Investors and financial institutions also require environmental disclosure from their portfolio companies to understand and manage their financed environmental impact.
Top asset managers Amundi, Schroders and Aviva were among the 263 financial institutions from 29 countries this year that called for environmental data from non-disclosing companies with high environmental impact such as Tesla, Exxon Mobil, Saudi Aramco and Glencore.
The non-disclosing companies targeted cover over $24 trillion in global market capitalization and are estimated to collectively emit more than 4,800 megatonnes of carbon dioxide equivalent annually.
While the majority (72%) of the non-disclosing companies were requested to disclose on at least their impact on climate change, CDP observed an increase in the number of companies that engaged on their water- and forests-related impact — a 51% and 36% uplift respectively compared to last year, demonstrating the growing awareness of the interrelatedness of the climate and nature crisis, according to CDP.
Additionally, it highlights the growing demand from the capital markets for corporate transparency on water and forest-related issues.
Elodie Laugel, chief responsible investment officer at Amundi, said: “The need for transparent and comparable corporate disclosure through a well-articulated framework on key environmental topics, such as climate, water, and deforestation, is more important than ever. CDP has been a standard setter for corporate disclosure since its inception and continues to be of great value to investors.”