CDP has announced that just 2% of global companies have been ranked in its annual A list for environmental action.
The A category is given for companies showing the most progress in transparency and performance around climate change, forestry and water security – with D the lowest rating.
The non-profit revealed that 272 companies worth $12 trillion (£9tn) collectively made the top list out of 12,000 scored – with these including Infosys, PepsiCo, AstraZeneca and Colgate Palmolive.
Out of those scored, L’Oréal, Unilever and HP were some of the 14 companies that achieved an AAA rating for their environmental performance – an increase from 10 last year.
It did disclose that the requirements and parameters of the A list had become more difficult to achieve; to raise the standards of companies worldwide and push them to achieve more. This led to the number of companies in the A list dropping slightly this year.
To achieve an A score, CDP stated that businesses must show governance on climate issues, have verified emission reduction targets and demonstrate risk management processes.
Although the A list became more difficult to break into, there was progress lower in the rankings, with more than 500 companies improving their scores from a C or D to a B in 2021.
The organisation did warn that the level of progression is worryingly slow however, with 58% still scored between C and D – meaning they are just starting to tackle their environmental impact – and companies making up $21 trillion (£15.8tn) in market capital are not even disclosing their impacts.
Global Director of Corporations and Supply Chains, Dexter Galvin, commented: “17,000 corporates failing to even take the first step and report their environmental data is far too many.
“These companies are not only putting the planet at risk but themselves. If they continue with business as usual, they will end up on the wrong side of public opinion, regulation and investor sentiment. Scrutiny is rising – empty targets or greenwash simply won’t fly.”