Your Guide to Tackling Climate Disclosure Requests

The way companies manage their climate risk is becoming a defining factor of success.

Today, a growing number of investors, customers, and other stakeholders want trustworthy information about how companies are managing their carbon footprints and climate-related financial risks. Meanwhile, climate disclosure regulations are gaining traction worldwide — prompting thousands of organizations to report on greenhouse gas (GHG) emissions in their supply chains. 

In response, voluntary carbon reporting through platforms such as CDP and EcoVadis has skyrocketed. To thrive in this atmosphere, you must be ready to meet a new high bar for corporate transparency around sustainability. 

In this article, we’ll provide a guide to responding effectively to climate disclosure requests — whether they come from investors, customers, or other stakeholders. 

Why Investors and Customers Are Requesting Climate Disclosures

Rising demand for climate disclosures is on trend to continue. More than 700 financial institutions (with over $142 trillion USD in assets) now request information from CDP about companies’ impacts on climate change, forests, water security, and biodiversity. Between 2019 and 2023, ratings firm EcoVadis provided procurement teams with sustainability assessments for more than 125,000 supply chain companies. 

There are a couple of factors driving these requests: 

Investors want to reduce exposure to climate risks and capitalize on opportunities. 

As climate change worsens, businesses must wrestle with physical risks like natural disasters, severe weather, and supply chain disruptions. They also face transition risks, including new regulations, litigation, shifting consumer demand, and reputational damage. 

Investors are paying close attention. Companies with significant exposure may face higher borrowing costs, lower credit ratings, or a decline in valuation. On the flip side, those with low-carbon offerings stand to gain substantial market share. For example, projections show that electric vehicles will make up 75% of global passenger vehicle sales by 2030, while sales of combustion engine cars will continue to decline. 

Financial institutions are also working to meet their own responsible investing commitments. To keep up, they need transparent data about the risks and impacts in their portfolios. 

Customers are under pressure to provide value chain data. 

Businesses face heightened expectations for transparency from consumers and regulators. Climate disclosure mandates in Europe, California, and other jurisdictions are putting pressure on organizations to disclose value chain data and meet scope 3 emissions targets. 

It’s not just about regulation, though. With consumers increasingly savvy and concerned with ecological impacts, sharing climate data and setting ambitious emissions targets can bring reputational benefits. Heavy value chain emissions can pose a risk to a company’s brand and market share. 

The bottom line is that companies are under scrutiny — a recent study by HEC found that ninety-one percent of companies consider sustainability criteria when making purchasing decisions.

Practical Steps for Responding to a Climate Disclosure Request

It can feel daunting to receive a climate disclosure request, especially if you’ve never completed one. To save time and prevent headaches, you can break the process down into these manageable steps: 

Step 1: Identify the Framework and Request Details

First, you need to understand whether the climate disclosure request is being made through CDP, EcoVadis, or another entity using TCFD or ISSB guidance. Then you should get clear on the scope of the request: Do you need to report on scopes 1, 2, and 3? Do you need to share an assessment of your climate-related financial risk? Answering these questions will help you gather relevant data. 

Step 2. Leverage Existing Reporting Frameworks

As much as possible, you should align your responses with the globally-recognized frameworks like the Taskforce on Climate-related Financial Disclosures (TCFD), the International Sustainability Standards Board (ISSB), the GHG Protocol, and PCAF. Following these frameworks will help ensure that your data is comparable and trustworthy. If you’ve already compiled data for regulatory purposes or other sustainability reports, you can reuse it for consistency and efficiency.

Step 3. Engage Internal Stakeholders

Internal collaboration is essential. The sustainability, finance, operations, and procurement teams often hold the necessary data, and their involvement will be crucial for gathering accurate and relevant data. As part of this step, you should assign roles and responsibilities, clearly defining who is responsible for gathering which data. Clear ownership will help you avoid delays and inconsistencies. 

Step 4. Define your organizational and operational boundaries

Before you can determine what data you’ll need, you must get clear about your boundaries. Is your organization part of a parent company or a subsidiary? This will determine who is in financial control of the assets, who has ownership over the GHG emissions, and the scope of emissions within your boundaries. 

Step 5. Ensure Data Accuracy and Transparency

Investors and customers expect your data to be reliable. Using validated methodologies like the GHG Protocol will help you feel confident in your calculations. Additionally, you should provide clear explanations for your assumptions. If certain data (for example, scope 3) requires estimations, be transparent about the methodology you used and the emissions sources excluded. 

Step 6: Leverage Technology/Climate Management Software

One of the best ways to ensure your reporting is reliable and efficient is by automating emissions tracking and reporting with a Climate Management and Accounting Platform (CMAP), like Persefoni. Using automated software instead of spreadsheets brings substantial benefits: It saves time, minimizes the risk of errors, sets you up for auditing and assurance, and can facilitate communication between customers and suppliers. Software can further streamline disclosure by standardizing reporting across CDP, EcoVadis, and other frameworks. 

The CDP Climate Change Questionnaire Explained

The CDP (formerly the Climate Disclosure Project) is a widely used voluntary reporting platform that enables companies to disclose environmental data in response to formal requests from customers and investors. The platform’s Climate Change Questionnaire is a cornerstone of this process, designed to provide transparency on corporate environmental impacts and assess the thoroughness and transparency of disclosures.

CDP evaluates responses and assigns a score based on the company’s environmental performance, governance practices, and commitment to climate action. This score is not just a compliance metric—it signals to stakeholders the credibility and ambition of a company’s sustainability efforts.

Key Details About the CDP Questionnaire

• Timeline:
  The CDP questionnaire is typically published in the spring, with reporting deadlines in the fall.
• Recent Questionnaire Updates:
  CDP introduced significant changes for 2024:
  • A combined questionnaire for climate, forests, and water security, simplifying the disclosure process for companies addressing multiple areas of sustainability.
  • A streamlined version of the questionnaire tailored for small and medium enterprises (SMEs) to encourage broader participation.
• For First-Time Reporters:
  Companies new to CDP reporting are encouraged to consult the Beginner’s Guide to Disclosure, which outlines the process and expectations for disclosure preparation.

How to Organize Your Response

Regardless of your organization’s experience with CDP, preparing for disclosure is more effective when structured around key themes:

1. Governance

This section assesses your organization’s leadership and oversight of climate-related issues. CDP will ask questions like:

• Does your organization have board-level oversight of climate-related issues?
• Is there at least one board member with climate-related expertise?
• Do you provide incentives for management tied to climate-related performance or targets?

Pro Tip: Highlight clear governance structures, roles, and incentives to demonstrate accountability and alignment with climate priorities.

2. Risks & Opportunities

Here, CDP asks you to identify and evaluate the physical and transition risks posed by climate change, as well as the opportunities they create. Example questions include:

• Does your organization have a process for identifying and assessing climate-related risks and opportunities?
• Have you identified any risks with substantive financial or strategic impact on your business?
• How does your organization assess its portfolio’s exposure to climate risks and opportunities?

Pro Tip: Include specific examples of risks and opportunities you’ve identified, along with detailed mitigation strategies or actions to capture opportunities.

3. Business Strategy

This theme evaluates how climate considerations are integrated into your overall strategy and financial planning. CDP will ask:

• Does your organization have a climate transition plan that aligns with a 1.5°C scenario?
• Do you use scenario analysis to inform your business strategy?
• What percentage of your organization’s spending/revenue is aligned with your climate transition goals?

Pro Tip: Align your responses with frameworks such as the TCFD or SBTi to demonstrate rigor and forward-looking planning.

4. Emissions Targets & Performance

One of the most critical sections, this section focuses on your GHG emissions and progress toward reduction targets. Key questions include:

• What are your gross global Scope 1 and Scope 2 emissions in metric tons of CO2e?
• How do your current emissions compare to the previous reporting year?
• Have there been any structural changes affecting emissions in the reporting year?

Pro Tip: Ensure your emissions data is reliable, verified, and presented in alignment with the GHG Protocol to boost the credibility of your responses.

5. Additional Themes

Beyond the core categories, CDP may ask about other aspects of your climate strategy, including:

• Emissions Methodology: The calculation methods and frameworks you use (e.g., GHG Protocol).
• Energy Use and Efficiency: Total energy consumption and renewable energy integration.
• Verification: Whether your disclosures are externally verified.
• Carbon Pricing: Any internal or external carbon pricing mechanisms your organization uses.
• Engagement: How you engage stakeholders, including customers and suppliers, on climate-related issues.
• Biodiversity: Impacts of your operations on ecosystems and your efforts to mitigate them.

For detailed requirements tailored to your industry or disclosure level, refer to the CDP guidance page.

The CDP Climate Change Questionnaire is more than a reporting mechanism—it’s an opportunity to reflect on your sustainability journey, identify areas for improvement, and demonstrate your commitment to climate action. By preparing thoroughly and aligning your responses with best practices, your organization can strengthen its credibility, meet stakeholder expectations, and unlock opportunities for growth in an increasingly sustainability-focused business landscape.

What to Expect in EcoVadis Climate Disclosure Requests

EcoVadis is a leading sustainability ratings provider, delivering actionable climate insights and ratings for businesses of all sizes. With over 130,000 companies assessed across 220 industries in 180 countries, EcoVadis focuses on promoting supply chain transparency and helping organizations improve their sustainability performance. 

Receiving a request to disclose through EcoVadis is becoming increasingly common, particularly from purchasers looking to evaluate their suppliers’ sustainability practices. However, using the platform offers more benefits than simply meeting customer demands. It can help you identify areas for improvement, address climate-related risks, and enhance your reputation by demonstrating your commitment to sustainability. A strong EcoVadis score can also position your company as a preferred partner in a growing number of industries.

The EcoVadis Disclosure Process

If you receive a request to disclose, your journey will begin with a detailed questionnaire, tailored to your industry. The questionnaire will cover all material sustainability impacts for your business, requiring you to submit supporting documentation to verify your claims.

EcoVadis uses a two-step process:

1. Analysis of Your Responses and Documentation: EcoVadis experts review your answers and evaluate the supporting documentation provided.
2. External Research: Analysts cross-reference your responses with publicly available information about your company’s sustainability performance.

Once this evaluation is complete, EcoVadis issues a scorecard that provides a detailed overview of your sustainability performance across key categories. This scorecard is shared with both you and the customer who requested the disclosure.

Time Commitment:
EcoVadis estimates that completing the questionnaire takes anywhere from a few hours to a few days, depending on:

• The size of your company.
• Your progress on your sustainability journey.
• How easily accessible the required data and documentation are.

Proactively organizing your sustainability data and processes before receiving a disclosure request can significantly reduce the time and effort required.

Aligning Your Responses With EcoVadis Scoring Categories

EcoVadis evaluates businesses across four key categories, which align with major international frameworks such as the UN Global Compact, UN Guiding Principles for Business and Human Rights, International Labor Organization conventions, Global Reporting Initiative (GRI) standards, ISO 26000, and the CERES roadmap. Providing accurate, complete, and reliable documentation for each category is crucial for achieving a strong score.

1. Environment

This category examines your ecological footprint and sustainability initiatives, focusing on:

• Carbon Emissions: Including Scope 1, 2, and 3 data.
• Energy Use: Renewable energy adoption and efficiency improvements.
• Water and Biodiversity Impacts: Conservation practices and mitigation of operational impacts.
• Waste and Pollution Management: Including material use, chemical handling, and end-of-life product treatment.

Pro Tip: Emissions data will be closely scrutinized, so ensure it is complete, reliable, and aligned with industry best practices. This includes clear documentation of your methodology for measuring and reporting carbon emissions.

2. Labor and Human Rights

This category assesses your labor practices and policies, including:

• Health, safety, and working conditions for employees.
• Policies addressing human rights risks such as child labor, forced labor, human trafficking, and discrimination.
• Diversity and inclusion initiatives.

Pro Tip: Demonstrating proactive monitoring and remediation efforts, such as supplier audits or grievance mechanisms, can significantly improve your score.

3. Ethics

EcoVadis evaluates the integrity of your business practices, including:

• Anti-corruption measures.
• Prevention of anticompetitive behavior.
• Information management, including data privacy and cybersecurity practices.

Pro Tip: A strong score in this category requires evidence of active implementation and enforcement of ethical policies, not just a documented Code of Conduct. Provide examples of regular audits, employee training, and monitoring efforts.

4. Sustainable Procurement

This category assesses how you integrate Corporate Social Responsibility (CSR) principles into procurement practices, with a focus on:

• Social and environmental impacts in your supply chain.
• Lifecycle analysis of your products and services.
• Supplier management practices, including audits and performance improvement programs.

Pro Tip: Highlight specific initiatives or tools you use to monitor supplier performance, such as requiring suppliers to adhere to sustainability codes or participate in training programs.

Preparing for an EcoVadis climate disclosure request may seem complex, but it offers significant value beyond compliance. By addressing these requests with care, you can not only satisfy customer demands but also strengthen your company’s sustainability practices, build trust with stakeholders, and improve your competitive positioning in an increasingly eco-conscious market.

Challenges and Pitfalls in Responding to Climate Disclosure Requests

Responding to climate disclosure requests can be daunting, especially when it comes to gathering the right emissions data. Challenges companies face when reporting typically include: 

Data Gaps

Reporting companies will likely encounter missing data as they submit disclosure questionnaires — especially for scope 3 emissions. Limited transparency and traceability across the value chain and a lack of automated and scalable tools for data extraction can compound the issue. To beef up your scope 3 reporting, it’s helpful to prioritize the suppliers, activities, and processes that contribute most to your footprint. Free carbon accounting software like Persefoni Pro can facilitate supplier engagement — you can share the platform with your suppliers at no cost to make it easier to collect their emissions data and incorporate it into your reporting. 

Complexity

Organizations with complex value chains and many different suppliers will find it more difficult to account for all of their scope 3 emissions. And many companies will need to simultaneously disclose under a variety of frameworks, including CDP, EcoVadis, and TCFD — adding an additional layer of complexity. 

Cost

One of the most commonly cited challenges in climate disclosure is cost. Building a reporting team, gathering data, and calculating carbon emissions can be expensive, especially for smaller companies with limited resources. To address this challenge — and expand access to carbon accounting — Persefoni offers a free version of its software, Persefoni Pro. Companies that receive requests through CDP and EcoVadis can explore the use of Persefoni Pro to calculate their carbon footprints at no cost. 

Preparing for Future Disclosure Requests

Expectations for climate transparency are only growing. A wave of regulations across the globe is creating a domino effect as companies subject to disclosure rules begin to gather carbon data from their supply chains. 

To avoid being caught off guard, you need to be ready to respond to disclosure requests from customers and investors. Fortunately, there are resources available to help. For example, automated carbon accounting software can dramatically streamline the disclosure process and build confidence in the data you’re sharing. 

To learn more, request a demo with Persefoni — or, to see firsthand how technology can facilitate reporting through CDP, EcoVadis, and other bodies — sign up for Persefoni Pro for free. 

Frequently Asked Questions (FAQs)

What’s the difference between CDP and EcoVadis?

While CDP and EcoVadis both offer sustainability assessments, there are a couple of key differences. CDP is a nonprofit with a focus on climate change, water, deforestation, biodiversity, and other environmental issues. CDP reports are aimed primarily at investors, the public, and other stakeholders. In contrast, EcoVadis is a for-profit company more tightly focused on business-to-business supply chain transparency. It provides detailed assessments on a wide spectrum of ESG issues — including climate, biodiversity, waste, pollution, and sustainable procurement — as well as ethics, labor, and human rights. 

How can small companies respond to climate disclosure requests with limited resources?

Small companies with limited resources can utilize free carbon accounting software to respond to requests from investors and customers. For example, Persefoni Pro allows you to calculate your emissions at no cost, ensuring the data you report is reliable, transparent, and consistent with global standards and frameworks. You can schedule a demo of Persefoni Pro to learn more about how it can help you prepare for reporting through platforms like EcoVadis and CDP. 

How often do investors request updates to climate disclosures?

Typically, investors will request that a company disclose on an annual basis. Both CDP and EcoVadis assessments are valid for twelve months, so companies should plan to update their data each year.