Responding to CDP – why, how, and what is new in 2025?
What is CDP?
CDP, formerly known as the Carbon Disclosure Project, is a globally recognised reporting platform that empowers companies, cities, and investors to transparently disclose their impact on climate change, water security, and deforestation. By reporting annually through CDP, organisations can benchmark their sustainability performance, uncover risks and opportunities, and respond to the increasing demand for transparency from investors and stakeholders.
Why it matters
Over the past 25 years, CDP pioneered environmental disclosure by emphasising the importance of data-driven transparency. According to CDP's latest annual report, more than 23,200 companies (making up two-thirds of global market capitalisation across 130 countries) and over 1,100 cities, states, and regions worldwide disclosed their environmental data through CDP in 2023. This marks a 24% increase in the number of reporting companies compared to the previous year. Additionally, more than 700 investors, representing a quarter of global institutional financial assets, now support CDP’s annual climate data request.
The growth reflects a rising global commitment to transparency and sustainability. Within just two years of disclosing through CDP, companies reduce their direct emissions by 7-10%. For example, nearly all FTSE100 companies report through CDP, and the majority (59%) are on track to meet their climate targets — well ahead of the average large company. For these companies, transparency is not just about reporting; it is the foundation for meaningful action.
Suppliers and customers may ask companies to report on CDP for several reasons. First, it helps assess environmental risks, such as those related to climate change and resource scarcity. Second, CDP reporting aligns companies with sustainability goals, ensuring they are meeting the growing demand for responsible practices. Additionally, with investors increasingly using CDP data for decision-making, transparency on environmental performance can support regulatory compliance and enhance investor confidence. Lastly, companies that report on CDP stand out in the market, showing leadership in sustainability, which can strengthen partnerships and build trust for long-term collaborations.
Overcoming barriers: common challenges with CDP reporting
Businesses responding to CDP disclosure requests, especially for the first time, can face several challenges. Despite the increasing number of investor requests, many companies are still not reporting or are providing only basic information, which leads to lower scores. For instance, only 400 out of 23,200 companies received the highest A-rating.
To create a quality CDP disclosure report and establish your company as a climate leader, you wil likely need to overcome several hurdles:
1. Data complexity: Carbon accounting involves complex calculations and thousands of data points, especially when reporting Scope 3 emissions, which require data-sharing with other organisations.
2. Resource constraints: Gathering and analysing climate data can be time-consuming and resource-intensive, often leading to inefficient manual processes and data inaccuracies. Additionally, CDP reporting requires cooperation from various teams within the company, and without a strong internal structure, it can be difficult to ensure effective reporting.
3. Capability gaps: Many companies lack the internal expertise to measure GHG emissions accurately, often needing to rely on costly external support.
CDP in 2025: what is changing and how to stay ahead
By 2025, CDP aims to have 90% of the highest impact companies disclose their environmental data through its platform. CDP will enhance its data collection and reporting standards to focus more heavily on high-quality, actionable data.
CDP has also committed to providing more specific guidance for different sectors, recognising that each industry has unique environmental challenges and opportunities. This tailored approach will help companies report more effectively and provide more meaningful insights to stakeholders. The 2025 strategy will emphasise the role of climate-related financial disclosure, encouraging companies to report not just on emissions but also on their climate-related financial risks and opportunities.
To report effectively in 2025, companies will need to move beyond basic emissions reporting to include detailed financial disclosures that assess how climate change could affect their business. Companies will also need to adapt to sector-specific guidelines, ensuring that their disclosures are relevant to their industry and stakeholders. Additionally, collaboration with suppliers and partners will be critical to address the growing emphasis on supply chain transparency. Being prepared for these changes will require companies to invest in data management systems and cross-departmental collaboration to meet CDP’s enhanced reporting standards.
How can you get started?
Starting with CDP requires a structured approach. Companies can receive a request to disclose from investors, customers, or CDP itself. If you have not received an invitation, you can still opt in voluntarily. Understanding the right questionnaire to complete is crucial, as CDP offers different ones for climate change, water security, and forests. Once identified, companies must gather relevant data, such as GHG emissions (Scope 1, 2, and relevant Scope 3 categories), climate-related risks and opportunities, and governance structures. To guarantee accuracy and comparability, reporting should be in line with accepted standards such as the SBTi, TCFD, and GHG Protocol. Lastly, as late reporting leads to lost chances and lower scores, reports should be done prior to the deadline.
Key considerations for (new) applicants
For companies new to CDP, the focus should be on data collection and completeness, as even partial disclosure is better than none. Reporting Scope 1 and 2 emissions first, then progressively adding Scope 3 emissions, is a smart way to start. It is crucial to set up internal roles and procedures for sustainability reporting. Examining benchmark reports from comparable businesses can also reveal best practices.
For companies already reporting, improving data quality and transparency should be a priority. CDP rewards detailed, science-based reporting. [AT4] Companies should work on their climate transition plan, which is increasingly important for CDP scoring, and engage with suppliers and stakeholders to enhance Scope 3 reporting.
Timeline for 2025
CDP follows an annual disclosure cycle. In February and March 2025, CDP will open the portal for requesters. The response window for corporates begins in the week starting 19 May 2025. Companies should begin compiling their data and engaging internal teams well before this date. By 15 September 2025, the response window will close, marking the final deadline for submissions. The official scoring deadline is yet to be confirmed by CDP, but last year the scoring deadline for Disclosers was 9 October, and the reporting window closed on 30 October. Companies should expect results to be published in November and December 2025. It is crucial to stay updated with updates from CDP to ensure compliance with deadlines.
How 2Impact can help you navigate CDP requirements successfully
At 2Impact, we specialise in guiding companies through CDP disclosures with tailored support. Our strategic advisory services help align sustainability strategies with CDP, CSRD, and other frameworks. We assist in data collection and verification, ensuring that emissions calculations are accurate, and reporting is verifiable. Our CDP readiness assessments identify gaps and improvement areas in your current disclosure. Additionally, we offer supplier engagement support to enhance Scope 3 reporting by working with your value chain.
Navigating CDP reporting can be complex, but with the right approach, it becomes an opportunity to improve transparency, investor confidence, and sustainability performance.
Get in touch with us at nishant@2impact.nl for a first conversation to explore how we can support you with CDP and ensure a smooth and successful disclosure process in 2025.
Link to our service "Sustainability Reporting".
