You’ve made it. You just submitted your CDP response and are breathing a sigh of relief (and possibly popping a bottle) to celebrate the end of the 2022 CDP reporting season. It may seem like a great time to kick back, relax, and wave goodbye to CDP until next year, but there are several compelling reasons to continue to ride the momentum you’ve built to prepare for a successful 2023 reporting cycle.
While you take a moment to bask in the great accomplishment of completing your latest CDP response, consider these top three reasons why you should not file CDP away in your to-do list until next spring.
CDP is backward looking
The 2023 CDP reporting cycle will only consider activities and progress that took place between Jan 1, 2022, and December 31, 2022. This means that you only have 5 months left to initiate actual changes that can be reported in your 2023 CDP response. With many companies just coming out of a rigorous reporting period, focusing on getting responses in order and submitted for the previous year, it’s important to continue to advance your efforts if you wish to improve your score for next year.
Think ahead on this: if you want to be able to say that you are doing something new in next year’s CDP response, such as aligning with TCFD on climate risk analysis or setting a new emissions reduction target, now is the time to activate those projects if you haven’t already. By the time the 2023 CDP season is back on your radar, especially after your 2022 score is released, it will be too late to initiate actions that will result in a boost to next year’s score.
By working now to enhance your sustainability programs, you can set your business up for success and demonstrate meaningful progress between your 2022 and 2023 responses. Doing so will show investors, NGOs, and other stakeholders that you are committed not only to transparency through reporting but also to impactful climate action through your increased efforts.
Furthermore, as your business becomes more mature in its climate strategy, progress on goals and impact metrics will require more time and effort. After your first few successful CDP responses, you’ve likely ticked off much of the low-hanging fruit and will need to begin to tackle more hefty long-term goals and challenges, which inherently take longer to demonstrate tangible progress.
Internal engagement takes time
Especially for companies newer to CDP reporting, extra time should be factored into your timelines to socialize and gain buy-in to get all your internal stakeholders on the same page. As you are building a reporting practice, there is much work to be done to align on decisions about your business’s theory of reporting. Like many things, there is more than one way to “do CDP reporting right”. It’s up to you, your leadership, and any external consultants you engage to decide what the best method is to match your business’s goals and maturity level.
For businesses more experienced in CDP reporting, this advice still applies. As your reporting strategy and goals get more sophisticated and ambitious, the more internal stakeholders you will need to engage as a part of the process. Whereas CDP reporting may initially begin and end within the energy and sustainability manager level, stakeholders from legal, communications, and even your C-suite will likely need to become more involved as you progress. It’s important to get these decision-makers comfortable with your strategy early on and factor in ample time for their review of the final response and integration of any feedback before the deadline.
For companies of all CDP experience levels, staying continuously connected with internal stakeholders throughout the year to source case studies, proof points, and examples will pay dividends. Having a database of stories to sift through during the 2023 CDP reporting season will not only save you time and reduce stress but also result in a more robust response and a greater likelihood to increase your score. Whether these are stories about completed emissions reduction projects, records of board meetings where climate risk was discussed, examples of steps made toward achieving your renewable energy goals, or anything in between, documenting these cases while they are fresh will help you tremendously next year.
Do you have a shared database where your team can drop good examples as they occur? A recurring checkpoint to engage story-owners on a more frequent basis? If not, consider establishing a process now to save yourself and your team from the last-minute scramble leading up to the 2023 deadline.
Rushed data is a recipe for stress
Getting your CDP data organized prior to the period when you are preparing your response will result in a smoother reporting process. Putting together a GHG emissions inventory, assessing what categories of data will be most material, identifying and engaging data owners on what you will need, and measuring your market-based emissions are just a few examples of things that can be done prior to CDP reporting season that will make external reporting of that data much simpler.
Avoid the extra stress of asking for data from data owners while you are trying to form your response. If you are still working from spreadsheets, consider adopting a digital and centralized system this year that will help you analyze and report in 2023. Doing so now will allow you to onboard and become familiar with the system before crunch time. These efforts will drive value even beyond your CDP score. Shared, visible, and clean data is the foundation of an impactful sustainability program. Getting your data in order will help you during CDP season and will also benefit your sustainability efforts overall by making access to insights and progress easily accessible to everyone in your organization who will benefit from it.
Start early to make the most of your CDP response
Today, in a time of increased attention on a company’s environmental performance, reporting to CDP is a strategic exercise, not just a box to check. With regulations for corporate ESG reporting strengthening in regions around the world, including the SEC’s proposed rule in the U.S., a strong CDP reporting practice will prepare your business for even more high-stakes disclosures.
To make the most of your next reporting season, start thinking now about processes and progress you can put in place before the end of this year. There’s always room to improve on your score, but if you wait until 2022 scores are released, it’s already too late to do something about it. In our consulting practice at Schneider Electric, we advise our CDP clients to engage with CDP data early and often to get the best results. And with CDP preparing to make big changes to its questionnaires in the coming years, it’s more important than ever to stay on top of your data, connected to your stakeholders, and in tune with the latest trends in corporate sustainability.
Stay tuned for more great tips to maximize your next CDP response, including a review of changes that will take place in the 2023 reporting season. Schedule a consultation with one of our experts today to set your business up for a rewarding 2023 CDP reporting process.