Environmental Disclosures: CDP Announces Plastics to Be Added to Reporting Platform for First Time
Additional author: Oliver Williams
On April 19, 2023, the influential CDP1 (formerly known as the Carbon Disclosure Project) announced that nearly 7,000 organizations worldwide can disclose their plastic-related impacts for the first time, as CDP’s global environmental disclosure platform opens for 2023 reporting. CDP is adding plastic-related reporting to its online platform in response to a request from more than 740 investors with US$136 trillion in assets.
Last October, CDP reported that a record of around 20,000 organizations (over 18,700 companies representing over half of global market capitalization and around 1,100 companies and governments) reported on CDP’s platform in 2022 and that this was a 38% increase over the prior year.
Through the platform, organizations will disclose information on the production and use of the most problematic plastics, i.e., plastic polymers, durable plastics, and plastic packaging.2 This data will be made publicly available in September 2023.
High-impact plastic sectors invited by CDP to disclose this information include:
(a) Chemicals: since 100 petrochemical companies produce 90% of all single-use plastic waste generated globally
(b) Fashion/apparel: as many apparel companies have been slow to transition to recycled materials—for some online stores, just 1% of items contain recycled materials
(c) Food and beverage: given that plastic packaging for food and beverage products is a major source of pollution
(d) Fossil fuels: since about 4% of the annual total use of oil and gas globally is for plastic production
(e) Packaging: as packaging was one of the largest applications of plastics globally in 2021, using 44% of all plastics
In its announcement, CDP also noted that:
Companies and investors face significant financial, physical, legal, technological, regulatory and reputational risks as a result of the plastic pollution crisis. As regulation is implemented, companies face US$100 billion annual financial risk if governments require them to cover waste management costs at expected volumes and recyclability; investments in petrochemicals and plastics worth about US$400 billion are at risk of becoming stranded assets; and near-term exposures (2022-30) to corporate liabilities from plastic-related pollution are material and likely to exceed US$20 billion.
1 CDP is a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states, and regions to manage their environmental impacts.
2 CDP’s plastics module, incorporated into CDP’s water security questionnaire, covers plastics mapping, potential impacts to the environment, business risks, and targets. For companies with certain plastics production and use activities, there are also questions on total weight, raw material content, and circularity potential. For more technical detail, please visit https://www.cdp.net/en/plastics.
