Their motive is to have a sustainable economy that works for both humans and the environment.

What is CDP?

CDP full form is a carbon disclosure company. It was based on the United Kingdom, Germany, and the united nations of America. It helps companies and cities to disclose their environmental impacts. They help companies to avoid the excessive use of greenhouse gases. Their motive is to have a sustainable economy that works for both humans and the environment.

It was established in the year 2000 in the UK. They are funded by government and philanthropic funds. They are governed by a set of trustees and directors. CDP local offices are in 90 countries above. More than 500 cities measure and disclose data annually. In 2021, over 14 thousand companies were disclosed by CDP.

Climate Change Risks

Based on 998 cities tracked by CDP, four out of five cities suffer from climate hazards like heavy rainfall, extreme heat, and drought. A quarter of cities are suffering from heat waves. It is expected to increase its frequency by 2025. Elderly and low-income households are highly exposed to climate hazards. Cities are the prime causes of climate change. Cities are responsible for 70% of greenhouse emissions.

Between 2010 and 2020 deaths were 15 times more by floods and heatwaves in vulnerable areas. 62 percent of cities are suffering from climate hazards. It would increase more in the future. While the cities are finding ways to control the carbon gas emission. It should also think about poverty, as it is estimated by the world bank that 132 million people will suffer from poverty due to climate change. 10% of the richest population are responsible for emission, whereas only 50$ of the population is responsible for 7% of emissions.

Year-long studies shown by McKinsey global institute researched climate change impact in all countries in the next three decades. It is said that India and Pakistan would be the first two countries to experience massive heat waves. It would rise by 14% in 2050. Countries are expected to major in at least one major type of physical, human, and natural capital by 2030. Increasing global warming can lead to loss of money.

What Cities Should Do Then?

Many countries faced issues in 2022 like floods in Pakistan and Assam, extreme heatwaves in the United Kingdom, and water scarcity in Qatar. Many people are dying due to these problems The first key step to reducing carbon emission is to measure the problem 65% of the cities are taking action to reduce carbon emissions. 55% have taken climate change assessments. The second step is to set emission targets 46% of the cities have kept a target on carbon reduction. As the cities took some actions to reduce emissions, they found that the health condition of people was improving and the economic benefits had increased. Over half of the cities also saw rich biodiversity and more green space.

Need For 'People-Centered Climate'

In December 2015. Leaders from all over the world shook hands to limit the global temperature. The economics of climate changed drastically. Coal prices were cheaper than solar and wind energy. Electric vehicles were getting improved. But at the same time, the countries have faced severe wildfires, storms, and heat waves in the first half of 2019. Studies also showed that an increase of half in the temperature can cause a huge threat to the globe. As climate change is increasing, people-centered climate action starts with talking about the policies making process and considering the residents’ needs while discussing the problem.

According to CDP, these bring better results when it is targeted to vulnerable groups like low-income households, elderly people, and citizens with health issues. The CDP also talked that government should help the cities to overcome climate issues. CDP also advised the cities to set science-based targets and include the needs of the citizens. Over 700 major businesses took the science-based target to reduce emissions. Some companies are also planning for zero net emissions by 2050. Some governments pledged to zero net emission goals. Over 68 countries took this pledge. In almost every city taking people-centered climate action, over 95% identified the co-benefits from the climate. It also improved air quality and reduction of health conditions. 85% have also noticed the social and economic benefits. Chicago, Athens, Hermosillo, Go yang city, and Auckland has witnessed cleaner air, and improvement in health, economic, and environmental benefits.

Annual Disclosures By Corporate

In CDP’s new 2025 strategy, they recognized the urgent need for climate change and transparent plans from cities and companies. In the next five years, CDP will broaden its spectrum of stakeholders to cover environmental challenges. They will also determine whether zero net is achievable or not. India's performance on climate action for 2050 has been rated high in GHG emissions and mild in renewable resources. In COP26, India declared that 1.5C will be achievable and achieve net zero emission by 2070.

Economic and financial goals in Zero net ambitions set by India are: India’s new climate goals will significantly compromise its target of a USD 5 trillion economy by 2024-25 according to global forecasting firm Oxford Economics. India will need to invest $200 billion p.a. of funding over the next two decades in order to become NetZero by 2070, accounting for progressive increases in expenditure as low-cost technologies are exhausted.

ESG's full form is the environment, social, and governance reports. Its disclosures include GHG emissions, air pollution emissions, energy use, etc. Many countries found the importance of non-financial disclosures through mandatory regulations. In July 2021, G7 finance ministers and central band members addressed the ESG for challenges multilateral economic cooperation. This was made mandatory in many countries like China, Japan, and South Korea.

Science Based Targets

Science-based targets help companies to meet the recommendation of the task force on climate-related finance (TCFD) regarding targets. SBTI is one of the growth initiatives which is designed to highlight the need to be the science-based target and prove the transparency of decarbonization by corporates. India leads the SBT disclosures and ranks 7th globally. 44% of Indian SBTI-committed companies already set targets related to different climate scenarios and others. As per 2021 data, 17 Indian companies set the most ambitious target for the 1.5C future. Wipro was the first Indian company which validated SBTI net-zero targets. The latest IPCC reports state that global emissions must be on a declining stage between 2020 to 2025.

Conclusion

India’s goal of zero net targets requires more companies to set new targets with correct measures and disclosures. As climate change can be seen in water scarcity, rising prices, and polluted air, these factors can be a risk for the companies as millions of dollars might be lost. Aligning with CDP helps companies to be environment friendly and change to climate change mitigation for the future.