Japanese companies lead on climate leadership

[LONDON] Japanese companies have topped an annual ranking of corporate climate efforts, in part because more have now had their targets signed off by a leading independent validator, non-profit data tracker CDP said on Wednesday (Jan 14).

Japan took the lead, with 22 per cent of its companies achieving what CDP defined as “climate leadership”.

It is followed by the UK with 17 per cent, the EU with 16 per cent, and China and South-east Asia at 8 per cent, it said in a report, co-authored with consultants Oliver Wyman.

As the world’s only independent environmental disclosure system, CDP assesses more than 10,000 companies on their awareness of environmental issues, management practices, transparency and performance.

It also looks at whether targets have been signed off by the Science-Based Targets Initiative (SBTi), a leading independent standard setter, something that had helped the Japanese firms outperform, said CDP chief executive Sherry Madera.

She added that now in its second year, the rankings showed that the global companies were still prioritising sustainability, despite geopolitical and economic uncertainty, and a recent wave of climate regulatory rollbacks in the US and Europe.

The companies were also assessed on climate, water and forest performance.

This covers emissions and climate strategy, water use and risk management, and deforestation risks in key commodities, such as palm oil, soy, timber and cattle.

The report found that all the top-performing companies on climate, and most of those leading on the topics of water and forest, tied executive pay to environmental goals.

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“Maybe companies are becoming quieter when celebrating their wins in the market, but they are still working towards sustainability, and year on year, leaders in the corporate health check are the ones who link their executive pay to climate leadership, and that trend has solidified,” noted Madera. REUTERS