Indian business makes progress on climate change disclosureJanuary 2009
Many more of India’s leading companies have signed up to disclose their carbon emissions and climate policies, a second round of reporting has shown.
The quality of reporting is higher too, the project sponsor WWF-India noted at the release of the India Carbon Disclosure Project (CDP) Report 2008.
Ravi Singh, secretary-general and chief executive of WWF-India, said: ‘The report demonstrates a positive and proactive attitude among the Indian companies towards addressing the challenges of climate change. It shows an encouraging trend that companies are not only aware of the various threats and risks presented by climate change, but are also becoming increasingly sensitive towards its commercial and financial opportunities.’
Tata Power, India’s largest private-sector electricity generating company, and Tata Motors, one of the world’s largest commercial vehicle manufacturers, were among the companies reporting for the first time to the India CDP Report.
Others reporting for the first time were HPCL, the Fortune 500 oil refining and marketing company; the State Bank of India; Mahindra & Mahindra, India’s largest sport utility vehicle maker; and Ambuja Cements.
The disclosure process was conducted by WWF-India with the CDP and the Confederation of Indian Industry’s Centre of Excellence for Sustainable Development. The CDP project represents 385 institutional investors with about $57,000billion (£37,700bn) in funds under management which view corporate responses to the climate challenge as a significant investment variable. Each year the CDP writes to thousands of companies world wide asking them to disclose figures and targets on their greenhouse gas emissions.
However, even though reporting by Indian companies is up from 37 in 2007 to 51 and includes some of the country’s leading companies with the highest climate impact, overall reporting remains low. The CDP invited 200 companies to participate, and of 61 respondents ten refused.
The sectors with the highest response rates were household and personal products – 43 per cent of contacted companies responded – materials (41 per cent), and banks and diversified financials (39 per cent). The worst were telecommunications and consumer durables and clothing companies.
About 80 per cent of the companies regarded existing regulatory mechanisms as an opportunity for triggering long-term investment in energy-efficient technologies rather than as a risk. However, these companies acknowledged that in future the regulations may affect their businesses.
Three-quarters of the organizations have either tackled or intend to manage or mitigate climate change risks by formulating relevant policies, changing operations, design and consumption patterns, strengthening supply chains and shifting to cleaner fuels. However, the report noted a ‘significantly low or almost negligible (3.4 per cent) use of energy purchased or generated from renewable sources’ and said Indian corporate use of renewable energy was ‘quite poor’ compared with that of multinationals.
About 40 per cent acknowledged that physical risks such as damage, disruption and displacement caused by climate change were serious challenges that could result in financial losses.
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