“Top of the class” green companies like Apple, BT and Google reap more profits
- 16 October 2014
LONDON: Top companies that put more effort into going green make more money than others. This is the conclusion of the report The A List: The CDP Climate Performance Leadership Index 2014 just published by CDP, analyzing 187 leading businesses which have decided to reduce their emissions.
Leading companies are investing far more in low carbon activities than others - as much as US$23 billion out of a total US$50 billion spending, states the report.
As a consequence, their climate initiatives are more effective, yielding average annual reductions of 9% per company, much more than the 6% obtained by the non-leading companies. In particular, the top companies reduced their total absolute emissions by 33 million metric tons compared with last year, with total emissions standing at 693.7 million metric tons.
Companies like Apple, BMW, BT, Coca Cola, General Motors, Microsoft Corporation, Google, Samsung, Unilever and Zurich Insurance Group were selected among 1,971 respondents to CDP’s questionnaire.
Together these ‘top green companies’ outperform companies in the Bloomberg World Index by 9.6% and the Dow Jones Sustainability World Index by 19.6%.
The methodology used for CDP's survey measures the level of detail and comprehensiveness of the companies’ emissions savings, as well as action taken on climate change.
Paul Simpson, Chief Executive Officer, CDP, says: “There is a palpable sea change in approach by companies driven by a growing recognition that there is a cost associated with the carbon they emit. Measurement, transparency and accountability drives positive change in the world of business and investment”.
Graph: Climate Performance Leaders Index (CPLI) compared to Bloomberg World Index and Dow Jones Sustainability World Index, 2010-2014. Image courtesy of CDP, from the report The A List: The CDP Climate Performance Leadership Index 2014
Another interesting finding is that top companies are more forward-looking in tackling climate change. Their plans usually span over 12 years, showing conviction that this issue can be only faced with a long-term plan.
Leading businesses are also more committed to finding a global solution, engaging with policymakers on climate change far more than the others - 78% compared to 49%.
CDP’s report is just the latest in a series of high-profile research that underlines the clear benefits for businesses that invest in a low carbon economy. “We must not choose between fighting climate change or growing the world’s economy,” said the former President of Mexico Felipe Calderón, Chair of the Global Commission on the Economy and Climate. Last month the Commission’s report Better Growth, Better Climate: The New Climate Economy revealed 50-90% of the actions required to cut emissions in most countries will also drive economic growth.
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By Ilario D'Amato