The score recognises actions to drive down carbon emissions across Ørsted's entire carbon footprint as well as transparent disclosure of financial impacts of climate risks in line with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
Based on the company's climate reporting to CDP in 2020, the A score also reflects Ørsted's carbon reduction targets that are approved as aligned with what science says is needed to stop global warming at 1.5 °C.
"We're delighted to be recognised again in CDP's A List of companies for significantly reducing our carbon emissions and transparently disclosing climate impacts towards investors," says Jakob Askou Bøss, Senior Vice President, Corporate Strategy and Stakeholder Relations, at Ørsted. "On track to be carbon neutral in 2025, Ørsted aims for a net-zero carbon footprint in 2040. We're engaging our strategic suppliers, encouraging them to map, disclose, and reduce their emissions as well. Understanding the climate impacts in our supply chain is an essential first step towards our 2040 target."
Engaging the supply chain
As Ørsted accelerates the build-out of green energy, the company is increasing focus on cutting supply chain emissions through close engagement with suppliers. In January 2020, Ørsted launched a programme to reduce emissions in the most carbon-intensive categories of the company's supply chain.
Strategic suppliers are asked to identify the most carbon-intensive parts of their businesses, develop decarbonisation road maps, and set science-based carbon reduction targets, among other key actions. Reducing value chain emissions is a joint journey, and for suppliers, the programme signals that Ørsted is helping to create demand for low-carbon products.
"So far, we've had a lot of positive feedback, and our suppliers are fully engaged. The message we've heard loud and clear is that we must solve this together," says Jakob Askou Bøss.
Taking the lead
Just the top 5% of more than 5,800 companies, including Ørsted, that were scored by CDP on their climate change, forests and water security disclosures, made it into the A list for 2020.
"Taking the lead on environmental transparency and action is one of the most important steps businesses can make, and it's even more impressive in this challenging year marked by COVID-19," said Paul Simpson, CEO of CDP, referring to this year's A List of companies. "The scale of the risk to businesses from climate change, deforestation, and water insecurity is enormous, and we know the opportunities of action far outweigh the risks of inaction."
Ørsted discloses data on climate performance through CDP's annual climate change questionnaire and received A and B scores in 2019 and 2018, respectively.
About the CDP rating
The annual CDP disclosure process uses an independent methodology to assess companies that disclose data on environmental impacts, risks, and opportunities. Companies are assessed using a questionnaire and are allocated a score ranging from A to F, depending on transparency of climate disclosure, awareness and management of environmental risks, and level of ambition and action in setting and reaching environmental targets. The CDP disclosure process is regarded by investors as the highest standard for corporate environmental transparency.