CDP Reporting: How to Get an ‘A’ Score

CDP reporting is the gold standard for corporate environmental transparency, acting as a critical benchmark for investors, stakeholders, and customers evaluating a company’s commitment to sustainability. Securing a top-tier ‘A’ score is not merely a recognition of excellent disclosure but a powerful testament to robust environmental stewardship, effective climate risk management, and a forward-thinking business strategy. This comprehensive guide will deconstruct the CDP framework, provide a step-by-step roadmap for success, and reveal the advanced strategies that separate leaders from the pack.

In this definitive guide, you will learn:

• The fundamental principles of the CDP and why its scoring system matters.
• A detailed, phase-by-phase action plan for compiling a winning disclosure.
• How to master data collection and management for Scope 1, 2, and 3 emissions.
• The importance of governance, strategy, and targets in achieving a high score.
• Advanced techniques for risk and opportunity management and verification.
• How to effectively utilize carbon offsetting and removal strategies within your response.
• The final steps for submission, scoring, and post-disclosure strategy.

Read More:

• Life Cycle Assessment: A Guide for Manufacturers
• ESG Meaning: A 5-Minute Guide for Businesses

What is CDP, and Why is an ‘A’ Score a Game-Changer for Your Business?

The Carbon Disclosure Project, now known simply as CDP, is a global non-profit that runs the world’s premier environmental disclosure system. It serves as a central hub for companies, cities, states, and regions to measure and manage their environmental impacts. CDP reporting is built on the premise that you cannot manage what you do not measure.

By standardizing the disclosure process through detailed questionnaires on climate change, water security, and forests, CDP provides a consistent and comparable dataset that is invaluable to a global network of investors, purchasers, and policymakers. The process involves responding to a comprehensive set of questions that probe deep into a company’s governance, strategy, risk management, metrics, targets, and emissions data.

An ‘A’ score from CDP is far more than a letter grade; it is a prestigious accolade that signals market leadership. In the realm of environmental, social, and governance (ESG) criteria, it is the equivalent of a gold medal.

This elite rating demonstrates to the market that your company possesses a sophisticated understanding of its environmental footprint and is implementing a proactive, strategic, and holistic approach to managing its impacts, risks, and opportunities. It is a powerful differentiator in a competitive landscape where stakeholders are increasingly making decisions based on sustainability performance.

The tangible benefits of achieving an ‘A’ score in your CDP reporting are profound and multifaceted:

• Enhanced Investor Confidence: Investors managing trillions of dollars in assets use CDP data to assess climate-related risks and opportunities in their portfolios. A high score reduces perceived risk and can lower the cost of capital.
• Competitive Advantage: Major corporations with extensive supply chains are increasingly using CDP scores in their procurement decisions. An ‘A’ rating can make your company a supplier of choice.
• Improved Risk Management: The process of preparing for CDP reporting forces a company to identify, assess, and prepare for climate-related risks, from regulatory changes to physical threats, making the business more resilient.
• Stimulated Innovation: The deep analysis required often uncovers new opportunities for efficiency gains, product development, and market expansion in the low-carbon economy.
• Strengthened Brand Reputation: An ‘A’ score is a credible, third-party validation of your sustainability claims, building trust with customers, employees, and the wider public.

How Does the CDP Scoring Methodology Work?

Understanding the CDP scoring methodology is the first critical step toward achieving a high score. The process is designed to reward both comprehensive disclosure and demonstrated environmental leadership. CDP scoring is not a secretive black box; its principles are publicly available, but mastering their application requires diligence and strategic insight. The scoring is based on the content of your submitted response to the climate change questionnaire, which is graded by accredited scoring partners.

The scoring framework is built on two fundamental pillars:

1. Disclosure Score: This evaluates the completeness and transparency of your response. It assesses whether you have provided all relevant information requested across all questionnaire modules. Points are awarded for answering questions thoroughly, with sufficient detail and supporting data. High disclosure is the foundational block—without it, you cannot progress to a leadership level.
2. Awareness Score: This goes beyond mere disclosure to evaluate your company’s level of awareness and management of environmental issues. It looks at whether you have identified, assessed, and are managing risks and opportunities. It judges the quality of your governance, targets, and strategic integration.
3. Leadership Score: This is the pinnacle, distinguishing companies that are demonstrating best practices and truly leading the way. It rewards ambitious, science-based targets, innovative actions, and tangible impacts that go above and beyond standard practice. To achieve an ‘A’, you must excel in both Awareness and Leadership.

The scoring is divided across several key thematic areas, each carrying a different weight:

• Governance (Weight: ~10-15%): Oversight and management of climate issues at the board and executive level.
• Risks & Opportunities (Weight: ~10-15%): Identification, assessment, and integration of climate-related risks and opportunities into business strategy.
• Business Strategy (Weight: ~10-15%): How climate change is factored into strategic planning and financial planning.
• Targets & Goals (Weight: ~10-15%): The ambition, robustness, and progress of your emissions reduction targets.
• Emissions Methodology & Data (Weight: ~30-40%): The accuracy, completeness, and verification of your carbon accounting (Scope 1, 2, and 3).
• Performance & Initiatives (Weight: ~10-15%): The actions you are taking to reduce emissions and improve performance.

The scoring bands are then defined as:

• A / A- (Leadership): Disclosing and demonstrating best practice across all key areas.
• B / B- (Management): Disclosing and demonstrating substantive action on climate issues.
• C / C- (Awareness): Disclosing and demonstrating some action, but lacking breadth or depth.
• D / D- (Disclosure): Disclosing information but demonstrating little awareness or action.
• F (Failure to disclose): Failing to provide a response or providing one that is insufficient for scoring.

What is the Step-by-Step Process for CDP Reporting?

Embarking on the CDP reporting journey can seem daunting, but breaking it down into a structured, phased process makes it manageable and effective. A successful submission is the result of months of preparation, cross-functional collaboration, and meticulous attention to detail. Starting early is the single most important piece of advice for any company, especially those aiming for a leadership score.

Phase 1: Pre-Planning & Governance (6-9 Months Before Deadline)

• Secure Executive Sponsorship: CDP reporting is a strategic, company-wide effort that requires buy-in from the highest levels. Secure a C-suite or board-level champion to endorse the project and allocate necessary resources.
• Form a Cross-Functional Team: Assemble a task force with representatives from sustainability, EHS, finance, risk, legal, operations, procurement, and communications. Assign clear roles and responsibilities.
• Conduct a Gap Analysis: Review your previous year’s response and score. If you are a first-time responder, obtain the current year’s questionnaire and assess your company’s readiness against each question.
• Set Clear Objectives: Define what you want to achieve. Is it improving last year’s score, achieving a specific grade (e.g., moving from a ‘B’ to an ‘A’), or simply completing a robust first disclosure?

Phase 2: Data Collection & Management (4-6 Months Before Deadline)

• Map Your Emissions: Identify all sources of Scope 1 (direct), Scope 2 (indirect from purchased electricity), and most critically, Scope 3 (value chain) emissions. This is often the most time-consuming phase.
• Gather Quantitative Data: Collect energy consumption data, fuel usage, travel records, procurement spend data, and any other information needed to calculate your carbon footprint. Tools like Climefy’s carbon calculator for large organizations can streamline this process by providing a structured framework for data input and emission factor application.
• Gather Qualitative Data: Work with relevant departments to draft responses for governance, strategy, risk, and opportunity sections. Conduct interviews with senior management to ensure alignment.

Phase 3: Response Drafting & Validation (2-4 Months Before Deadline)

• Assign Questions: Divide the questionnaire sections among your team members based on their expertise.
• Draft Responses: Write clear, concise, and evidence-backed answers. Use data to support your statements. For example, don’t just say you have a target; state the target, the baseline year, and your progress to date.
• Internal Review Cycle: Circulate drafts for review by subject matter experts and legal/communications teams to ensure accuracy and consistency of messaging.
• Senior Management Review: Present the near-final draft to your executive sponsor and other leaders for final sign-off.

Phase 4: Finalization, Verification & Submission (1 Month Before Deadline)

• Proofread and Format: Ensure there are no errors and that the response is formatted correctly for the CDP online response system.
• Consider External Verification: While not mandatory for CDP, having your emissions data and select responses verified by a third-party assurer adds a layer of credibility and can positively influence your score.
• Submit Ahead of Time: Do not wait until the final hour. Submit your response at least a few days before the deadline to avoid any last-minute technical issues.

How Can You Master Data Collection for Scope 1, 2, and 3 Emissions?

The bedrock of any successful CDP report is accurate, comprehensive, and verifiable data. The emissions data section carries the most significant weight in the scoring process, and weaknesses here will undermine even the most well-written qualitative responses. Mastery of carbon accounting across all three scopes is non-negotiable for an ‘A’ score.

Scope 1: Direct Emissions
These are emissions from sources that are owned or controlled by your company.

• Sources: Stationary combustion (boilers, furnaces), mobile combustion (company-owned vehicles), process emissions (industrial chemical reactions), and fugitive emissions (leaks from refrigeration or air conditioning units).
• Data Collection Strategy:
  • ✅ Implement regular meter readings and fuel purchase tracking systems.
  • ✅ Maintain detailed logs for company vehicle fleets (mileage, fuel type).
  • ✅ Use direct monitoring where feasible for industrial processes.
  • ✅ Calculate using the formula: Activity Data x Emission Factor = Emissions

Scope 2: Indirect Emissions from Purchased Energy
These are emissions from the generation of purchased electricity, steam, heating, and cooling consumed by the company.

• Sources: Electricity drawn from the grid, purchased steam, etc.
• Data Collection Strategy:
  • ✅ Collect electricity invoices or meter data to obtain consumption figures (kWh).
  • ✅ Use the market-based method (using supplier-specific emission factors) is now required by CDP for a leadership score, alongside the location-based method.
  • ✅ Procuring Renewable Energy Certificates (RECs) or Power Purchase Agreements (PPAs) and reporting them correctly is crucial for showing reduction efforts.

Scope 3: Value Chain Emissions
These are all other indirect emissions that occur in a company’s value chain. For most companies, Scope 3 emissions represent the largest portion of their carbon footprint and are the most challenging to calculate.

• Key Categories: Purchased goods & services, capital goods, fuel- and energy-related activities, upstream transportation and distribution, waste generated in operations, business travel, employee commuting, upstream leased assets, downstream transportation and distribution, processing of sold products, use of sold products, end-of-life treatment of sold products, downstream leased assets, franchises, and investments.
• Data Collection Strategy (Prioritization is Key):
  • ✅ Step 1: Screen to identify which of the 15 categories are relevant to your business.
  • ✅ Step 2: Prioritize the most significant categories using spend-based or physical data estimates.
  • ✅ Step 3: Collect data. This can involve:
    • Supplier Engagement: Using surveys (e.g., based on the CDP supply chain questionnaire) to collect primary data from key suppliers.
    • Spend-Based Analysis: Multiplying financial expenditure on goods/services by secondary emission factors (e.g., $ spent on paper x kgCO2e per $ of paper).
    • Hybrid Models: Using primary data where available and secondary data for the rest.
  • Tools like Climefy’s carbon calculator for small & medium companies can help smaller organizations navigate this complexity by providing a structured approach to Scope 3 estimation.

Why are Governance, Strategy, and Targets So Critical for a High CDP Score?

CDP evaluators look for a “golden thread” that connects climate action from the boardroom to the operational level. Is climate change a peripheral CSR issue, or is it hardwired into the DNA of the company’s strategy and governance? Demonstrating the latter is essential for a leadership score.

Corporate Governance: The Bedrock of Accountability

Strong governance shows that responsibility for climate issues is held at the highest level.

• ✅ Board Oversight: Disclose that a specific board committee (e.g., Sustainability, Risk, or Audit Committee) has formal oversight of climate-related risks and opportunities. Detail the frequency of reporting to the board.
• ✅ Management Responsibility: Name the C-suite executive(s) responsible for day-to-day management of climate issues and describe how their performance is linked to achieving climate targets (e.g., through executive remuneration KPIs).
• ✅ Incentive Structures: Provide clear examples of how climate performance metrics are incorporated into the bonuses or performance reviews of senior executives and other employees.

Business Strategy: Integrating Climate into the Core

This section evaluates how climate considerations shape your company’s strategy and financial planning.

• ✅ Climate Integration: Describe how climate change has directly influenced your business strategy—for example, by pivoting investments towards low-carbon products or divesting from carbon-intensive assets.
• ✅ Resilience Analysis: Demonstrate that you have tested your business strategy against different climate scenarios, including a 1.5°C or 2°C scenario. Explain the outcomes and how they informed your strategic decisions.
• ✅ Financial Planning: Link climate-related investments and expenditures to your capital allocation plans and financial forecasts.

Targets & Goals: Demonstrating Ambition and Action

Targets are the tangible proof points of your commitment. Vague goals will not suffice for an ‘A’ score.

• ✅ Science-Based Targets (SBTs): The single most important action for a high score is having near-term and long-term emissions reduction targets validated by the Science Based Targets initiative (SBTi). This independently verifies that your targets are aligned with the goals of the Paris Agreement.
• ✅ Net-Zero Target: For true leadership, an ambitious net-zero target for 2050 or sooner, also validated by SBTi, is increasingly expected.
• ✅ Target Coverage: Your targets should cover a significant portion of your Scope 1, 2, and 3 emissions. A target that ignores Scope 3 will be viewed as incomplete.
• ✅ Progress Tracking: Report annually on your progress against targets transparently, even if you are off track, and explain the corrective actions you are taking.

What Are the Best Practices for Managing Risks and Opportunities?

CDP’s framework requires companies to move from simply identifying risks and opportunities to demonstrating a sophisticated process for managing them. This section is your chance to showcase your company’s strategic agility and forward-thinking approach.

Climate-Related Risks: Identification and Management

Risks are categorized as either transition risks (associated with the shift to a low-carbon economy) and physical risks (resulting from climate impacts).

• Established Best Practices:
  • ✅ Comprehensive Risk Register: Maintain a dynamic register of climate risks that is integrated into the enterprise-wide risk management framework.
  • ✅ Robust Assessment: Quantify the potential financial impact and likelihood of each material risk. Use a clear scoring matrix (e.g., High/Medium/Low).
  • ✅ Detailed Mitigation Strategies: For each top risk, describe a specific mitigation or adaptation action plan. For example, for a “transition risk” like a carbon tax, detail your strategy for internal carbon pricing or energy efficiency investments. For a “physical risk” like flooding, describe site-level adaptation measures.
  • ✅ Board-Level Review: Evidence that the risk register and mitigation strategies are reviewed and approved at the board level annually.

Climate-Related Opportunities: Innovation and Growth

Companies that score highly don’t just see climate change as a risk; they see it as a source of competitive advantage and innovation.

• Established Best Practices:
  • ✅ Strategic Opportunity Mapping: Identify opportunities such as developing new low-carbon products or services, accessing new markets, using more resilient supply chains, or improving resource efficiency.
  • ✅ Financial Quantification: Estimate the potential positive financial impact of these opportunities, just as you would for risks.
  • ✅ Capital Allocation: Show that you are actively investing in seizing these opportunities. Link them to R&D projects, new business units, or marketing campaigns.
  • ✅ Example: A company might identify an opportunity in the growing demand for sustainable packaging. Their response would detail the R&D investment, the projected market size, the timeline for launch, and the expected revenue.

How Do Carbon Offsetting and Removal Factor into CDP Reporting?

A critical and often misunderstood aspect of CDP reporting is the role of carbon credits. CDP is unequivocal: carbon offsetting is not a substitute for deep, internal emissions reductions. However, when used correctly within a comprehensive climate strategy, high-quality carbon credits can play a valuable role.

The CDP Stance on Offsetting

CDP expects companies to prioritize direct abatement within their own value chain. Offsetting projects should be viewed as a complementary action to address residual emissions that cannot yet be eliminated through technological or economic means. Leadership companies use offsets not as a cheap alternative, but as a way to finance additional climate action beyond their value chain while they decarbonize their core operations.

Choosing High-Integrity Carbon Credits

Not all carbon credits are created equal. Using low-quality credits can damage your credibility and your CDP score.

• ✅ Prioritize Verified Standards: Credits should be certified under rigorous standards like the Climefy Verified Carbon Standard (CVCS), Verra (VCS), or the Gold Standard. These ensure the projects are real, additional, permanent, and uniquely verified.
• ✅ Focus on Removal Projects: While avoidance/reduction projects (like renewable energy) are important, CDP and the market are increasingly favoring carbon removal projects (like afforestation, biochar, or direct air capture) because they physically remove CO2 from the atmosphere, which is essential for achieving net-zero.
• ✅ Ensure Co-Benefits: High-quality projects often deliver additional environmental and social benefits, such as biodiversity protection, water conservation, and community development, which align with broader ESG goals.

How to Disclose Offsetting in Your CDP Response
Transparency is key. You must clearly disclose:

• The volume of credits retired (in tCO2e).
• The standard(s) and project type(s) they came from.
• How these credits are used in relation to your emissions reduction targets (e.g., to compensate for residual emissions on the path to net-zero).
• Platforms like the Climefy Marketplace provide access to a curated selection of high-integrity GHG reduction projects, making it easier for companies to find and invest in credible offsetting options that can be confidently reported in their CDP disclosure.

What Are the Final Steps for Submission and Post-Submission Strategy?

Submitting your response is a major milestone, but the work doesn’t end there. A strategic approach to the final steps and post-submission period can solidify your success and set you up for future improvement.

Pre-Submission Quality Check
Before you hit “submit,” conduct a final audit of your response:

• ✅ Consistency Check: Ensure all data points are consistent across the response. For example, the emissions total in the targets section must match the total in the emissions data section.
• ✅ Evidence-Based Claims: Scrutinize every sentence. Can you back it up with data? Remove any vague, unsubstantiated marketing language.
• ✅ Narrative Flow: Read the response as a whole. Does it tell a compelling and coherent story of your company’s climate journey, from governance to targets to action?

The Post-Submission Period: Learning and Improving

• Score Analysis: When your score is released, analyze the feedback provided by CDP in detail. Understand where you lost points and why.
• Internal Debrief: Hold a meeting with your core team to discuss what went well and what could be improved for next year. Document lessons learned.
• Communicate Your Score: Proactively communicate your score to investors, customers, and employees. An ‘A’ score is a powerful PR and marketing asset. Even a ‘B’ can be framed as a commitment to continuous improvement.
• Begin Next Year’s Cycle: The CDP process is cyclical. Start planning for next year immediately, using your current score as a baseline for improvement. Consider enrolling key team members in the Climefy Sustainability Academy to deepen their expertise in carbon accounting and ESG strategy, ensuring an even stronger performance next time.

Frequently Asked Questions – FAQs