CDP-FTSE-350-Climate-Change-Report-2012

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estimates that the global market for low-carbon energy
solutions in 2020 could be over US$2.2 trillion.
In addition, investors are increasingly using climate
performance metrics to positively and negatively screen
potential investments. United Utilities believes that
an experience in delivering a business strategy which
integrates climate change and a transparent strategic
narrative around climate change puts it at a strategic
advantage. Indeed, while only 33% of responding
companies consider themselves to have a strategic
advantage relating to climate change, the proportion
jumps to 74% when looking at the companies listed on
the CDLI. While the percentage of all reporting companies
who integrate climate change into their strategy remains
low (2012: 56%), 95% of CDLI companies already have an
integrated strategy. 80% of the CDLI also includes climate
change-related information in their annual reports.
Being able to report a long-term understanding of
physical risks provides greater confidence to shareholders
and customers. While customers may focus on the
environmental impact of companies’ products or services,
investors may focus on the long-term resilience of their
business. Extreme weather patterns are increasingly
frequent in the UK and worldwide (physical risks were
highlighted by 74% of respondents) and can have a
significant impact on a company’s business continuity. For
example, Debenhams notes how a number of its supply
chain operations are located in areas at risk from flooding
or droughts and the supply of materials for products may
be negatively affected by extreme weather events.
The gulf in the quality of reporting between CDLI
companies and non-CDLI companies highlights how
regulation will help other companies catch up with the
leaders. Mandatory reporting, such as the UK’s proposed
regulations on GHG reporting, will provide further impetus
towards an integrated reporting model.
“We recognise that climate
change is not just an
environmental challenge; but
also one that affects the health
and livelihood of millions of
people because of the links to
complex issues such as poverty;
economic development and
population growth. We believe
that the most effective response
to the challenges associated
with climate change can only be
achieved through a concerted
global effort.”
Astra Zeneca
“In 2012, our sustainability
credentials were requested in
£2.7bn of customer bids.”
BT Group
“We believe that incorporating
climate change in our strategy
has helped us to gain strategic
advantage; both operationally...
and in the market places
we serve.”
Electrocomponent