What is CDP?

CDP (formerly Carbon Disclosure Project) is a leading global non-profit that runs one of the world’s largest environmental disclosure systems. Since 2000, it has enabled over 23,000 organizations — covering more than half of global market capitalization — to measure and disclose their environmental impacts. CDP reporting connects companies with investors (representing over $130 trillion in assets) and stakeholders to drive accountability on emissions, water security, and deforestation risks.

Why It Matters

CDP’s central belief is that “measurement drives management.” Disclosing through CDP helps companies manage climate risk, align with international frameworks (like TCFD, SBTi, and the SDGs), and demonstrate action on material environmental issues. It supports long-term value creation and helps future-proof operations.

Core Objectives of CDP Reporting

• Enable better decisions: By providing high-quality, comparable ESG data, CDP helps investors and customers make informed decisions about risk, resilience, and supplier selection.

• Strengthen risk management: CDP promotes transparency on emissions, water use, and forest impacts across operations and supply chains.

• Align with global goals: Disclosures show alignment with the Paris Agreement and growing regulatory expectations (e.g., CSRD, ISSB).

• Drive improvement: Public scoring mechanisms motivate companies to set measurable targets and continuously improve performance.

Strategic Business Benefits

• Reputation & brand value: High CDP scores signal sustainability leadership and attract ESG-conscious investors and partners.

• Market differentiation: CDP-aligned companies often gain an edge in procurement and capital access.

• Operational efficiency: The reporting process identifies inefficiencies and opportunities for decarbonization, water savings, and deforestation mitigation.

• Preparedness for regulation: CDP structures align with CSRD, GRI, TCFD, and ISSB — simplifying future reporting obligations.

What Does CDP Ask For?

CDP issues three key questionnaires:

• Climate Change: GHG emissions (Scopes 1, 2, 3), climate risks/opportunities, scenario analysis, and transition plans.

• Water Security: Water withdrawal/consumption, supplier water risks, mitigation actions, and performance metrics.

• Forests: Deforestation risks across high-impact commodities (e.g., timber, palm oil, soy, cattle) and traceability systems.

How to Prepare

• Identify internal data owners across sustainability, operations, EHS, procurement, and finance.

• Map requirements from the questionnaires to internal systems.

• Collect and validate data using recognized methodologies (e.g., GHG Protocol).

• Document assumptions and methods clearly for audit readiness.

• Plan early: CDP typically opens in February, with submissions due by late July.

Role of ESG Tools

Modern ESG platforms streamline CDP reporting by:

• Centralizing and automating data collection

• Mapping data directly to CDP modules

• Enabling audit trails and quality checks

• Generating insights for performance improvement

• Supporting cross-framework reporting (e.g., TCFD, ISSB, CSRD)

Final Thoughts

CDP is not just a reporting framework — it's a strategic tool to demonstrate climate leadership, reduce risk, and respond to growing investor and regulatory demands. Companies that take CDP seriously today will be more resilient, trusted, and competitive tomorrow.