$31 trillion investor project puts pressure on corporate giants to go green

Under the banner of the Carbon Disclosure Project 211 institutional investors managing a total of US$31 trillion are asking 1,800 huge corporations to publish data on their greenhouse gas emissions.

This is the fourth time the project has written to corporate giants politely asking them to own up to their impact on global emissions and the idea has snowballed.

Just a year ago the coalition had 143 members, approached 500 companies and could boast a mere $20 trillion of investment capital (see related story).

But now a larger group of investors has collaborated to increase the pressure.

The previous three requests were sent to the 500 largest corporations by market capitalisation in the world, the FT500.

Now the coalition is also targeting market leaders in specific countries such as the US, Japan, Canada, the UK, Germany, France, Brazil, Australia and New Zealand.

It is also turning its attention to the world’s biggest power companies.

Corporations that previously provided responses have been invited to report their progress.

Those that ignored the previous letter from the coalition are being asked to give the data this time or to provide a reason why they do not believe the request is relevant to their business.

Paul Dickinson, the project coordinator, said: “The numerous indications of accelerating human induced climate change make it clear that there are business risks and opportunities that have implications for the value of investments in corporations worldwide.

“Examples include changes in weather patterns; political and regulatory momentum moving against significant carbon emitters; the development of emissions-sensitive technologies, products and services superseding those existing today; and shifts in consumer sentiment due to a corporation’s stance on climate change.

“This makes it necessary for investors to improve their understanding of climate change risks and opportunities. The data to assess these issues is not always available, sometimes lacks comparability or is of poor quality.

“The Carbon Disclosure Project aims to encourage the development of a common emissions measurement methodology and to facilitate its integration into general investment analysis.

“The signatories recognise that companies face pressure to comply with constant demands for information and so have joined in this single call for information to reduce the number of requests.”

The corporations quizzed have been asked to respond within four months. The information received will be summarised in various reports which will be made publicly available at the Carbon Disclosure Project from September 2006.

By Sam Bond