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Merger Creates the World’s Largest Natural Capital Disclosure System

| Thursday June 14th, 2012 | 0 Comments

The Carbon Disclosure Project (CDP) and Global Canopy Programme (GCP) announced earlier this week that they will merge to create the biggest natural capital disclosure system in the world. The system will include forest, carbon, and water disclosure. The merger will happen gradually over the next two years, and GCP’s Forest Footprint Disclosure (FFD) Project and CDP will together create the first comprehensive corporate disclosure of the earth’s natural capital.

The Rio Earth Summit has focused on the Green Economy and there have been various calls for changes in the way sustainability is viewed. Natural capital accounting is a cause for concern for many companies and this is often not calculated properly. This convergence of two of the biggest disclosure projects means that businesses and their investors will better understand how they impact or use critical natural capital in their operations and supply chains.

Paul Simpson, CEO at CDP said: “Investors and corporations are becoming increasingly aware of the extent to which their value chains are influenced by natural resource constraints which lead to increasing price volatility and risk of business interruption. Bringing forests, which are critically linked to both climate and water security, into the CDP system will enable companies and investors to rely on one source of primary data for this set of interrelated issues.”

Andrew Mitchell, executive director of GCP and chairman of FFD added: “Companies around the world have huge impacts on forests, whether they know it or not. Destroying forests contributes around 15 percent of global carbon emissions and undermines the ability of the world to feed itself by degrading land and harming water supplies.  By bringing forest disclosure together with carbon and water, we’re going to be making it easier for companies to understand how they are impacting the world’s natural capital – and how they can do something about it.”

Many companies have responded positively to this announcement and stakeholders agree that the announcement has come at a timely moment just before the Earth Summit. In order for sustainable development and green economy to be taken more seriously by companies, reporting has to become more stringent and one of the ways to do this is proper accounting of natural capital. Bringing all natural capital under one umbrella will also make it easier for companies to be more transparent about their activities and also to reduce confusion whilst compiling a report.

 Image Credit: Kremtak, Wikimedia Commons


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