World's leading companies lack plan on climate change

Most of the world's 500 biggest companies have no programme in place, with explicit targets, to reduce their emissions of greenhouse gases, despite mounting evidence that the earth is heading towards environmental catastrophe.

The most comprehensive study of the environmental behaviour of the world's biggest corporations, by the Carbon Disclosure Project (CDP), found that emissions from these businesses are rising at an alarming rate and most are not acting to tackle the issue.

Among the worst performers in the research, which rates companies on a scoring system, were Pepsi, the soft drinks giant, Nintendo, the computer gaming group, and the financial services giant American Express. Among the 33 British companies, the company doing the least, by far, to address the issue is BAE Systems, the arms manufacturer that employs thousands of people in this country.

CDP is an international coalition of institutional investors, which together manage assets worth $31.5 trillion. It includes the likes of Aberdeen Asset Management, Hermes Investment Management and HSBC in the UK. The research, which examines companies in the FT500 global index, is based on the extent to which businesses are aware of climate change issues and how much they are doing to reduce their emissions of harmful greenhouse gases, rather than which companies have the greatest absolute level of emissions.

Of the 500 biggest companies in the world, 360 provided information to the CDP and although 87 per cent of them recognised climate change as a key risk, 52 per cent of these businesses had no targets to reduce their emissions.

Even more worrying for the researchers was the 140 companies that did not provide any data, suggesting an even lower level of concern about the environment. Among these were Honda, Bridgestone, Apple Computers, Goldman Sachs, Kellogg, Philips, Google and Yahoo!.

Counting together those with no reduction programme and those unwilling to provide information, 65 per cent of the world's biggest businesses have not implemented an emissions reduction programme. The companies surveyed are responsible for 10 per cent of the world's annual greenhouse gases emissions, producing 3.3 billion tonnes of carbon dioxide this year.

James Cameron, chairman of the CDP said: "The findings confirm that awareness of the risks and opportunities posed by climate change has risen dramatically among investors and the companies they own. But awareness alone will not drive the changes in investment and corporate strategy needed if disastrous climate change is to be avoided. For that, investors will have to put the CDP data to work."

On the CDP scoring system, the British companies did relatively well, averaging a score of 75, with the exception of BAE, which scored just 25 out of 100. The UK companies scoring below average were Standard Chartered, Scottish & Southern, SABMiller, Royal Bank of Scotland, Prudential, O2, Lloyds TSB and BAT.