CDP's Carbon Action Initiative Brings $10 Trillion to Bear on Climate

CDP's Carbon Action Initiative Brings $10 Trillion to Bear on Climate

Investor support for the CDP Carbon Action initiative has more than doubled since its launch last year, the Carbon Disclosure Project (CDP) announced this week.

Carbon Action was launched in April, 2011, on behalf of 34 institutional investors with $7.6 trillion in assets under management. Today, the number of investors stands at 92, and their combined assets exceed $10 trillion.

This year, the initiative wrote to CEOs of 415 of the world's largest public companies. The letters, which are "tailored to company-specific circumstances," according to CDP, requests that the companies set and disclose annual emissions reduction targets, invest in emission reduction activities, and reduce emissions across their supply chains.

A report issued earlier this month by CDP found that large corporations "are not yet demonstrating significant emissions reductions in their supply chains." Less than a quarter of corporate respondents "help their suppliers to quantify the return on their low-carbon investments."

Carbon Action builds upon the work of CDP, which requests corporate disclosure of greenhouse gas (GHG) emissions and other climate-related risks. More than 650 institutions, with more than $78 trillion in assets, are signatories, and 80% of the world's largest corporations report their carbon emissions to CDP.

"Institutional investors increasingly recognize that companies in their portfolios can reduce emissions while generating efficiencies," Paul Simpson, CEO of CDP, said. "Minimizing exposure to emissions regulation in Australia, the EU and other markets will also protect their investments for the long-term. Companies that capitalize on financial savings as a result of carbon reductions are well placed to improve their competitive position in the marketplace."

CDP noted a significant increase in signatories from Australia, whose Senate narrowly approved a Clean Energy Act in November. The Act, which will take force in July, requires the country's 500 highest emitters of GHGs to pay a carbon tax.

Eighteen US-based institutions are among the 92 signatories to Carbon Action. They are the Blumenthal Foundation, Boston Common Asset Management, Calvert Group, CERES, Clean Yield Group, ClearBridge Advisors, Connecticut Retirement Plans and Trust Funds, First Affirmative Financial Network, Mercy Investment Services, the Nathan Cummings Foundation, Neuberger Berman, Pax World Funds, Portfolio 21 Investments, Rockefeller Financial - Sustainability & Impact Investing Group, Swift Foundation, Tri-State Coalition for Responsible Investment, Walden Asset Management, and Zevin Asset Management.

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