IT Sectors Lag in Carbon Disclosure, Performance, Says Carbon Disclosure Project Report

Siemens and Samsung are among the top five “global leaders” in carbon disclosure and performance in the Carbon Disclosure Project’s (CDP) 2010 Global 500 index released Monday. The report said U.S. companies lag their global peers in the “numbers and types of action they are taking to reduce greenhouse gas emissions.” Managing carbon is becoming a “strategic business priority and competitive driver” for the largest global companies, even though there’s a lack of international agreement on climate change, it said.

Despite regulatory uncertainty, 90 percent of companies surveyed believe there’s “significant commercial opportunity arising from climate change,” the report said. North America is behind Europe in carbon disclosure and performance, it said. Areas identified by companies for action include energy efficiency of operations -- likely driven by cost savings possibilities -- and development of innovative products and services that help customers reduce emissions, the report said. Among “non-responders” listed in the index is Latin American telecom company America Movil.

"Carbon management continues to rise as a strategic priority for many businesses,” said CDP CEO Paul Dickinson. It’s “fueled by opportunities to reduce energy costs, secure energy supply, protect the business from climate change risk and reputational damage, generate revenue and remain competitive,” he said. A separate index identifying S&P 500 leaders listed Cisco, Con Ed, News Corp., Praxair and Spectra Energy as a “well-defined group of emerging American business leaders.” Non-responders in the S&P index included Amazon, Comcast, DirecTV and Time Warner Cable.

The telecom sector has a relatively low carbon footprint with regard to scope 1 and scope 2 emissions, the report found. Scope 1 emissions cover a company’s direct emissions, such as from on-site energy production or other industrial activities. Scope 2 accounts for energy purchased from off-site. Telecom companies said regulatory “risks” they face are mostly outside the U.S., citing the EU’s Energy Using Products Directive, the U.K.’s Carbon Reduction Commitment Scheme and Australia’s National Greenhouse and Energy Reporting System and Federal Energy Efficiency Opportunities program. The telecom sector’s performance has been broadly in line with the average of all sectors, the report said.

U.S. telecom companies said they were involved in industry-led projects like the Global e-Sustainability initiative and the Digital Energy Solutions Campaign, the report said. It said the telecom sector expects regulations in areas such as standards relating to products and labeling, energy efficiency, network efficiency standards and emissions targets in the event of an international agreement, carbon taxes and mandatory reporting. The industry has the potential to “assist the rest of the economy in tackling climate change” via technologies such as videoconferencing and optimizing transport routes via GPS tracking, the report said.

The IT sector reports the lowest levels of risk from climate change, mostly because it isn’t now subject to significant carbon regulations, the report said. The sector’s scope 1 and scope 2 emissions are low compared with other sectors, with the largest emitters being technology manufacturing facilities and data centers, it said. But the industry’s total footprint, including product use and disposal, is about 2 percent of global emissions, it said. The IT sector is lagging behind others in performance, the report said. More than 35 percent of respondents did not achieve the minimum carbon disclosure score to be ranked for carbon performance, it said. Only 35 percent of IT respondents said climate change has been integrated into their overall business strategy, the report said.