80% of companies on track to meet climate targets link executive pay to achieving those goals.
A disconnect exists between businesses meeting minimum requirements and those using data for impactful, Earth-positive decisions.
Only 1% of companies are leading with comprehensive strategies across climate and nature impact, carbon pricing, and value chain engagement.
A recent CDP Corporate Health Check reveals that 80% of companies on track to meet climate targets now tie executive pay to achieving these goals, underscoring the importance of governance and strategic action in driving environmental progress. This inaugural report will be presented at the World Economic Forum in Davos, shedding light on how large corporations are addressing the growing climate and nature crises.
The CDP Corporate Health Check evaluates corporate transparency, climate governance, and progress across companies representing 67% of global market value. Key findings show that companies actively making progress on emissions and nature are more likely to integrate environmental data into business decisions.
Key actions, such as linking executive pay to climate outcomes (78%), pricing carbon internally (41%), and engaging suppliers and customers on climate (87%), are linked to better environmental outcomes. Nearly two-thirds (64%) of companies making progress on emissions already have climate transition plans, compared to just 36% of laggards.
However, only 10% of companies show meaningful ambition in environmental areas like emissions transparency (Scope 1-3), nature impact, and strong sustainability strategies. Just 1% of companies reached the highest level, successfully integrating all four key levers: executive pay, carbon pricing, climate transition plans, and value chain engagement.
Sherry Madera, CDP’s Executive Director, stressed, “Disclosure alone cannot deliver action; integrating this disclosure data as a core dataset for key business decisions enables the levers to be pulled and the change we need to see.”
Sherry Madera, CDP’s Executive Director
James Davis, Partner at Oliver Wyman, highlighted the gap between disclosure and action: “The most effective strategies include transition plans, carbon pricing, value chain engagement, and linking executive pay to climate goals.”
James Davis, Partner at Oliver Wyman
Gim Huay Neo of the World Economic Forum emphasized, “Companies need to leverage data, technology, and innovative partnerships to turn crisis into opportunity.”
Gim Huay Neo of the World Economic Forum
Feike Sijbesma, Co-Chair of the WEF’s Alliance of CEO Climate Leaders, added, “Now is the opportunity for all stakeholders to act boldly and accelerate the pace of climate and nature action for a sustainable future.”
Feike Sijbesma, Co-Chair of the WEF’s Alliance of CEO Climate Leaders
"Sustainable development is the development that meets the needs of the present without compromising the ability of future generations to meet their own needs."