The Carbon Disclosure Project (CDP), a collaboration of over 315 institutional investors, including Goldman Sachs, Merrill Lynch, Allianz and HSBC, with assets under management of more than $41 trillion, is now working with some of the world's largest companies to help them assess greenhouse gas (GHG) emissions through their supply chains.
CDP has teamed up with some of the largest purchasing global organisations under the CDP Supply Chain Leadership Collaboration (SCLC). New SCLC members are Dell, Hewlett Packard, L'Oreal, PepsiCo, and Reckitt Benckiser. They join Cadbury Schweppes, Nestlé, Procter & Gamble, Tesco, Imperial Tobacco, and Unilever, who signed on last fall.
CDP is working with these global companies and their suppliers to create a single standardized approach to provide key climate change information throughout their supply chains.
Each member of the Supply Chain Leadership Collaboration has selected up to 50 suppliers to work with them and to respond to the CDP pilot information request in the first quarter of 2008. The results of the pilot will refine the process in preparation for the roll out and will help customers and suppliers to work together to develop strategies to reduce their carbon footprints. Some members will work with suppliers at national level, others will work internationally.
The project will be rolled out in May 2008, and CDP is inviting more companies to join the Supply Chain Leadership Collaboration. This will broaden both the geographical and sectoral scope - and potentially bring tens of thousands of new suppliers into the CDP process and extend disclosure globally. A report will be produced on the findings.
Paul Dickinson, CEO of CDP commented: "The Supply Chain Leadership Collaboration is a key step towards a unified business approach to climate change. By bringing together the purchasing authority of some of the largest companies in the world, CDP will encourage suppliers to measure and manage their greenhouse gas emissions. This will enable large companies to work towards managing their total carbon footprint, as the first step to reducing the total carbon footprint is to measure its size."
The CDP information request gathers detailed information on companies' supply chains. It encourages suppliers to report carbon footprints and climate change-relevant information, such as greenhouse gas emissions data, emissions reduction targets and climate change strategy. This is the first scheme that allows corporations to assess the emissions through their supply chain using one single standardized methodology. This will vastly decrease the burden on suppliers who might otherwise receive several separate requests for similar information.
Key sectors which are represented in member supply chains include agriculture, chemicals, transportation, buildings management, packaging and electronic components. This is also the first time CDP will collect climate change relevant information from private companies and Small and Medium Enterprises (SMEs) and the Supply Chain Leadership Collaboration will bring some of the world's largest privately owned companies into the CDP system. It is also an important step to moving the CDP process into China, where a significant number of suppliers to large multinationals are based.
Comments from members of Supply Chain Leadership Collaboration
Tod Arbogast, Director of Sustainable Business, Dell Inc.
"Dell believes that partnerships between companies, suppliers, stakeholders and customers are critical to making a real difference in protecting the Earth we share. Our partnership with CDP in the Supply Chain Leadership Collaboration will give us tremendous insight to help reduce not only our own carbon footprint, but ultimately that of our supply chain."
Pat Tiernan, Vice President, Social and Environmental Responsibility, Hewlett Packard
"For decades HP's Design for Environment Program has focused on innovation, reducing environmental impacts and responsible practices in product development, operations and supply chain. We joined the CDP Supply Chain Leadership Collaboration project to help develop a consistent and appropriate methodology for reporting energy use and carbon emissions throughout the supply chain."
Pierre Simoncelli, Director, Corporate Sustainable Development Managing, L'Oreal
"L'Oreal is pleased to be one of the first members of the Supply Chain Leadership Collaboration. We believe our participation in this pilot project is a win-win for the Environment, our Suppliers and L'Oreal. Our suppliers will now have a single central source for reporting their greenhouse gas strategies and results that is accessible to all their customers. We also believe this will help drive our performance as well as theirs in this important environmental area."
Walter Todd, Vice President, UK Operations, PepsiCo:
"This initiative fits our 'Performance with Purpose' mission. It's a great opportunity for us to work closely with our suppliers to encourage them to understand and reduce their carbon footprints, and to identify opportunities where we can work together with them to reduce our collective impact on the environment. In doing so, we hope to develop a more economically secure supply chain that is able to face the tough climate change challenges that lie ahead, one that we believe will bring long-term future benefits to PepsiCo UK, our suppliers, and the environment."
Dr. Peter White, Director, Global Sustainability, Proctor and Gamble
"Participating in the CDP Supply Chain Leadership Collaboration is one of the steps that will help P&G achieve its new 5 year sustainability goals, which include improving the environmental profile of our products across their lifecycles. Working within supply chains to innovate and reduce CO2, as well as other environmental impacts, will be a key part of this work."
Edward Butt, VP Sustainability, Reckitt Benckiser Group plc:
"The Supply Chain Leadership Collaboration project is an important step forward in understanding and reducing organisations and products carbon footprints. Not only is it contributing to our own Carbon 20 programme to reduce the Total Carbon Footprint of our products across their entire lifecycle, the data derived from the Supply Chain Leadership Collaboration project will also help to drive within our global supply chain additional measurement and improved management of climate change impacting processes, products and services."
Sir Terry Leahy, CEO, Tesco
"Tesco is one of the founding partners in the new CDP initiative for the supply chain. It has a simple aim: to bring together major retailers and key brands so that we can understand, report and reduce carbon emissions within the supply chain. I very much hope that firms who supply us and our competitors will consider being part of this venture"
Ian Midgley, Senior Vice President Supply Chain for Unilever plc:
"We have been setting and meeting targets for tackling the impact of our own operations on the environment for some considerable time, but we really want to continue to develop our understanding of greenhouse gas management across our extended supply chain. The collaboration with the CDP and other companies with similar aims should accelerate learning and leverage expertise in this critical arena. Hence we are delighted that participation in the Supply Chain Leadership Collaboration pilot is continuing to grow. We look forward to being part of this work over the coming months."
Carbon Disclosure Project
CDP is an independent not-for-profit organisation established in 2000 to facilitate dialogue between companies and investors, supported by quality information, from which a rational response to climate change will emerge.
CDP is a special project of Rockefeller Philanthropy Advisors in New York, with 501(c)3 charitable status.
Institutional Investors use CDP data to feed into investment products as well as to inform their lending decisions. Investors also identify companies in their portfolios with both high quality and poor carbon disclosure practice and some file shareholder resolutions for better disclosure on climate risk from companies not complying with CDP disclosure.
David Hopkins, Carbon International
+44 (0)20 7483 7201
Samantha Hill, Carbon International
+44 (0)20 7483 7205
Carbon Disclosure Project
+44 795 0000 272