Linking Climate Engagement to Financial Performance
An Investor's Perspective by Sustainable Insight Capital Management and CDP
Bonn, 1 October 2013 - The publication, released by the Carbon Disclosure Project (CDP) and Sustainable Insight Capital Management, analyzes the CDP disclosure scores of 702 companies covered in CDP’s
Global 500 climate change reports from 2008 to 2012. Using peer-to-peer
comparisons, companies were ranked by industry and split into quintiles
by their CDP disclosure score, then examined against various metrics of
financial profitability. The analysis shows that industry leaders in the
first quintile based on their relative CDP scores provide a higher
return on equity (+5.2 percent), more stable cash flow generation (+18.1
percent) and higher dividend growth (+1.6 percent).
According to Kevin Parker, Sustainable Insight Capital Management's CEO, the
analysis is one of the most extensive studies to date linking corporate
profitability and climate change engagement.
Marc Fox, CDP advisor and co-author of the SICM report, adds that the two
organizations hope the study facilitates broader uptake by investors and
corporate investor relations linking engagement on climate change and
The publication was released on September 23 at the New York Stock Exchange, together with the CDP's annual carbon performance and disclosure ratings for the S&P 500
. The two complementary
reports show that CDP leaders that incorporate environmental factors
into their business strategies are mitigating climate related risks,
finding opportunities to strengthen their businesses and delivering
higher profitability than their industry peers, the authors say.
The whole article can be seen here
and the publication can be downloaded here
Tags: Ecosystem valuation | Finance Industry
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