Carbon Disclosure Project warns some businesses risk being left behind as carbon cutting pioneers go from strength to strength.

The gap between those blue chip firms with an effective climate change strategy and those failing to take account of climate change risks is widening, according to the head of the high-profile Carbon Disclosure Project (CDP).

Speaking to BusinessGreen.com ahead of the launch of the CDP’s annual report on the climate change strategy of the Global 500 list of multinationals, chief executive Paul Dickinson said that clear differences were emerging between those firms taking urgent action to tackle carbon emissions and those that are only paying lip service to the need to tackle climate change.

To highlight the widening gap, CDP has today launched a new Carbon Performance Leadership Index (CPLI), including the top 48 carbon-cutting firms in the Global 500. It found notable differences between these leading firms and the rest of the pack in all four of the areas the CDP report assesses – governance, strategy, achievements and stakeholder engagement.

The top positions in the CPLI were dominated by European firms with Siemens, Deutsche Post, BASF, Bayer and Samsung Electronics making up the top five companies in the index.

Dickinson said the main reason for the improved performance of these leading firms was their wider understanding of their global impact.

“The key question [for businesses] is how good is your radar?” he said. ” Some businesses don’t have very sophisticated global ambitions, so they don’t see any need to implement changes, but then there’s another category that really do see the impact of their actions. So it really depends on whether you’ve got good antenna.”

For example, the report found that 85 per cent of CPLI firms have integrated climate change risks or opportunities into their overall business strategy, compared to just 48 per cent of the wider Global 500.

CPLI-listed firms also reported more use of monetary incentives to encourage staff to act on climate change policies, with over 92 per cent reporting that they use financial incentives to encourage employees to reach climate-related targets. In contrast, just under half of the respondents from the wider Global 500 have employed measures such as bonuses for hitting carbon targets.

As a result of such measures, 94 per cent of the CPLI firms said they had made progress in cutting carbon, compared to just 55 per cent of the rest of the Global 500 respondents. Moreover, 52 per cent of CPLI firms said they had significantly cut emissions in the last year, compared to just 19 per cent of all the Global 500 respondents.

The report also found that firms in the CPLI index are increasingly positioning themselves to take advantage of commercial opportunities that are arising from climate change, such as carbon trading and renewable energy investments.

Dickinson said that those firms making slow progress on climate change policy had been allowed to drag their feet as a result of the failure to deliver an international climate change deal at the UN’s Copenhagen Summit last year.

“If there was a global deal, it would have been simpler for people to plan their business strategies,” he said. “We would have had a responsibility to carry out the legislation. Instead, we’re seeing a segregation between those businesses that are looking into the possibilities of benefiting from climate change and those that are acting as if there’s not a problem. And that gap is widening.”

However, he warned that those firms that failed to take action to curb carbon emissions now risked losing their competitive edge to those rivals that are investing in climate change measures. “Climate change is getting bigger every year and the sooner people wake up and smell the coffee and address their business strategies the better,” he said.

His comments were echoed by Alan McGill, a specialist in business carbon and climate change reporting and measurement at consultancy giant PwC, who analysed the CDP report. He said that the investors who used the information made available for the CDP report were increasingly demanding the kind of detailed data released by the CPLI firms.

“The issues for investors have shifted,” he explained. “Originally they wanted to know the information was being disclosed by companies. Now they are asking more questions about the robustness and credibility of the data. Disclosure alone is not enough. They are asking if the management team is using the information to drive the business strategy, and performance improvement. That’s why the new Performance Index this year and the trends that emerge from it over the coming years will become more and more important.”

He also warned that businesses around the world could soon face regulations demanding that they provide information on their carbon emissions and climate change policy.

“Already the Australian government has concluded that because of the financial implications, assurance of the reporting on these issues by a registered auditor is appropriate,” he said. “Defra will be deciding on whether carbon should become a mandatory reporting requirement for companies later this year, and the SEC has issued guidance as well. Companies that are signed up to CDP are in the first wave of a much wider movement towards integrated reporting. “