CDP Disclosure: A Guide for Australian Businesses Reporting on Climate, Water and Forests

CDP (formerly Carbon Disclosure Project) is a global questionnaire-based disclosure platform enabling organisations to disclose climate, water, and forest risks and strategies to investors and stakeholders. For Australian organisations seeking to engage with major institutional investors or operating in climate-sensitive industries, CDP disclosure complements AASB S1 and S2 reporting.

For broader ESG context, see our complete ESG guide for Australian businesses.

What Is CDP?

Overview

CDP is a not-for-profit organisation that operates the world’s largest disclosure platform for climate and environmental risks. More than 700 institutional investors with over $100 trillion in assets use CDP data to make investment decisions.

Organisations disclose via standardised questionnaires addressing:

Climate Change: Governance, strategy, risk management, metrics & targets for greenhouse gas emissions
Water Security: Water risks, governance, management, metrics & targets
Forests: Deforestation and forest conversion risks in supply chains (particularly commodity sourcing)

Participation

CDP is voluntary. Organisations choose to participate in response to investor requests or for stakeholder engagement. Both large companies and SMEs can participate.

The CDP Questionnaires

Climate Change Questionnaire

The most widely completed questionnaire, covering:

Governance and leadership on climate
Strategy and business integration of climate
Risk and opportunity assessment
Emissions measurement (Scope 1, 2, 3)
Emissions reduction targets and progress
Verification and assurance

Scope: Detailed questionnaire (typically 100+ questions) requiring 20-40 hours to complete accurately. Questions build on each other—early answers determine what later questions appear.

Water Security Questionnaire

Addresses water risks material to the organisation:

Water governance and management
Water risks and impacts
Water use metrics
Water management targets

Forests Questionnaire

Focuses on deforestation and conversion risks:

Commodity sourcing and deforestation risk exposure
Supply chain management practices
Forest conversion prevention strategies
Traceability and verification

Relevance: Primarily for companies in agriculture, food production, consumer goods, or other sectors sourcing commodities from forest-conversion-risk areas.

CDP Disclosure Benefits

Investor Engagement

Major global investors screen CDP disclosures when evaluating investments
Demonstrates climate and environmental governance to investor base
Can affect access to capital and cost of financing

Benchmarking

CDP provides scoring (A list = leaders, B and C = management, D and F = disclosure/non-disclosure)
Scores enable comparison to peers within industry
Annual scoring drives continuous improvement

Transparency and Risk Management

Structured questionnaire drives systematic climate/water risk assessment
Completing questionnaire reveals governance and data gaps
Public disclosure signals commitment to stakeholders

Getting Started with CDP Disclosure

Step 1: Decide Which Questionnaires to Complete

Determine which environmental disclosures are material:

Climate: Material for all organisations to varying degrees
Water: Material for water-intensive industries (agriculture, mining, manufacturing)
Forests: Material for agricultural, food, consumer goods companies sourcing commodities

Start with Climate; expand to Water/Forests if material to your business.

Step 2: Gather Data and Information

GHG emissions (Scope 1, 2, 3) and supporting methodology
Board/management climate strategy and targets
Risk assessment results and management strategies
Climate scenario analysis (if conducted)
Water or forest data (if completing those questionnaires)

Step 3: Register and Complete Questionnaire

Register on CDP website
Follow questionnaire structure, answering all required questions
Questionnaire saves progress, so can be completed over multiple sessions
Plan 20-40 hours for first completion; less for subsequent years

Step 4: Submit and Monitor Score

Submit completed questionnaire by CDP deadline (typically September for previous year data)
CDP reviews for completeness and accuracy
Assigned a score (A list, B, C, D, F) typically 3-4 months after submission
Monitor score and benchmark against peers

Improving Your CDP Score

Set emissions reduction targets: A list companies typically have science-based targets
Strengthen governance: Board-level climate oversight and remuneration linkage
Integrate climate into strategy: Show how climate affects business model and decision-making
Scope 3 disclosure: A list often includes comprehensive Scope 3 measurement and targets
Verification: External assurance or science-based validation of targets improves scores
Supply chain engagement: Evidence of supplier climate engagement and data collection

Frequently Asked Questions

Is CDP mandatory for Australian companies?

No, CDP is voluntary. However, ASX-listed companies may face investor requests for CDP disclosure. Large companies in climate-sensitive industries are increasingly expected to disclose.

How does CDP scoring work?

CDP assigns scores (A list = leadership, B and C = management, D = disclosure, F = non-response) based on completeness and quality of questionnaire responses, climate governance, strategy, and target-setting.

Can we use our AASB S2 report to complete CDP?

AASB S2 and CDP have overlapping content (governance, strategy, risk, metrics). However, CDP questionnaire is structured differently. You can extract data from AASB reporting to support CDP completion, but questionnaire still requires specific responses.

Moving Forward with CDP

CDP disclosure is an effective way to communicate climate and environmental governance to global investors and stakeholders. For organisations already reporting under AASB S1/S2, CDP represents incremental effort to reach institutional investor audience critical to capital access and market valuation.

Ready to develop your CDP disclosure strategy? Book a Free ESG Strategy Session to assess whether CDP disclosure is relevant and plan completion approach.

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