In 2011, CDP has raised the bar by enhancing the scoring methodology for both disclosure and performance questions to make the scoring results more relevant to investors and other stakeholders.
The number of companies in the CDLI has increased to 26 in 2011 (20 in 2010) due to the increase in the Nordic sample to 260 companies (200 in 2010).
The highest disclosure score in 2011 is 97, achieved by Fortum, closely followed by Tieto with a score of 96. These scores are higher than the highest disclosure score in the 2010 Nordic 200, which was 93 (achieved by Stora Enso).
Nine companies enter or re-enter the Nordic 260 CDLI in 2011. The entry of Ekornes into the disclosure leadership index is particularly noteworthy since the company responded for the first time this year.
The average disclosure score of the CDLI companies is 84 in 2011 (84 in 2010, 76 in 2009). The lowest CDLI score is 80 in 2011 (78 in 2010, 72 in 2009). Thus the quality of disclosure within the CDLI remains similar, although the growth in the index from 20 to 26 means that the number of companies achieving high disclosure scores this year is greater in absolute terms.
The overall Nordic 260 average disclosure score is 64 in 2011 (60 in 2010, 55 in 2009), indicating a general improvement in the quality and depth of responses by Nordic companies, despite the increasing stringency of the scoring mechanism from year to year.
All sectors2 are represented in the
CDLI, confirming the view that high quality disclosure is possible in all areas of industry. The Materials sector has high representation compared with the Nordic 260 as a whole, while Industrials, Energy & Utilities and Transportation have low representation. Many companies have reached the CDLI on more than one occasion. However, eight companies have featured in the leadership index for the third consecutive year, thereby demonstrating a strong long term commitment to measuring and reporting on climate change.
CDLI and Shareholder Value Companies included in the Nordic CDLI in 2011 have a higher total return3 from January 2005 to May 2011 than Nordic 260 companies, outperforming them by a total of 84 percentage points over the five year period. This indicates that companies which are successful at measuring and reporting on climate change demonstrate higher financial performance.
Figure 20: Total return % (US$) 200
It is noted that the relationship between strong carbon disclosure scores and total return has not been fully explored and the data tell us little about causality. The relationship does not necessarily indicate that one causes the other; both will be influenced by a range of factors. These may include the quality of the companies’ management, the resources available to measure and manage emissions or the companies’ broader approach to identifying and capitalising on opportunities or managing risks. These findings would benefit from further analysis by the investment community.
150
100
50
0
-50
2. See explanation of the sector classification used in this report on page 40.
3. Total Return includes interest, capital gains, dividends and distributions realised over a given period of time. The composition of the CDLI should not be construed as investment advice.
Nordic 260 2011 Nordic CDLI 2011
Source: Bloomberg 35
Jul-11 Jan-11 Jul-10 Jan-10 Jul-09 Jan-09 Jul-08 Jan-08 Jul-07 Jan-07 Jul-06 Jan-06 Jul-05 Jan-05
Total return % (US$)
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