GLOBAL - Carbon management is becoming a strategic business priority and competitive driver for the largest global companies, according to the Carbon Disclosure Project’s (CDP) 2010 Global 500 report.

The initiative is backed by 534 institutional investors representing more than $64trn (€49trn) of assets under management.
However, despite the increase of boardroom and executive level engagement and 65% of Global 500 respondents implementing emissions reduction targets, only 19% of the Global 500 companies show significant emissions reductions.

Of the leading global companies surveyed, 85% reported having board or senior executive level responsibility for climate change, and nearly half - 48% - are now embedding climate change initiatives into the overall business strategy and across the organisation.

Nine out of 10 companies surveyed identified significant commercial opportunity arising from climate change, separating the companies driven by risk factors from those identifying and seizing competitive advantages and cost-benefits.

Paul Dickinson, chief executive at CDP, said: “Fuelled by opportunities to reduce energy costs, secure energy supply, protect the business from climate change risk and reputational damage, generate revenue and remain competitive, carbon management continues to rise as a strategic priority for many businesses.

“Companies globally are seizing commercial carbon opportunities, often acting ahead of any policy requirements.

“More companies than ever before are reporting through CDP and measuring and reporting their emissions, which is the first building block in working toward a low-carbon economy.”

The top five global 500 leaders for 2010, which scored 95 or above out of 100 in the Carbon Disclosure Leadership index (CDLI), were Siemens, Deutsche Post, BASF, Bayer and Samsung Electronics.

The largest Global 500 ‘non-responders’ in 2010 by market capitalisation were Berkshire Hathaway, Rosneft, Reliance Industries,, Sberbank, Teva Pharmaceutical Industries, América Móvil and Alcon.

According to the report, North America significantly lags Europe in disclosure and performance.

Just 6% of performance leaders in the Global 500 are from North America, as opposed to 21% from Europe.

The two main areas of focus for action are the energy efficiency of operations and the development of innovative products and services that enable customers to cut their emissions.

A similar report undertaken on S&P 500 companies showed Consolidated Edison, News Corporation, Spectra Energy, Praxair and Cisco Systems as the top five leaders, with scores ranging from 92 to 96 (out of 100).

The largest five non-respondents were, Visa, Comcast, Honeywell International and DIRECTV Group.

This year, CDP sent questionnaires to more than 4,700 of the world’s largest corporations, requesting information on greenhouse gas emissions, the risks and opportunities related to climate change and the actions companies are taking to manage those risks and opportunities.