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Peer benchmarking analysis: the latest climate disclosure trends

April 25, 2024

Peer benchmarking is an essential way for climate teams to gauge how organizations are disclosing their climate-related risks and opportunities publicly and produce comparable and decision-useful information. With Manifest Climate, organizations can access real-time peer benchmarking intelligence to inform decisions, drive action, accelerate compliance and mitigate climate risk. With climate disclosures constantly evolving, climate teams rely on Manifest Climate for the fastest and most consistent way to understand disclosure trends. 

To help organizations understand the latest trends for climate disclosure, we performed a benchmarking exercise, analyzing over 350 companies, to assess how organizations are managing climate-related risks and opportunities, including:

  • Integration of climate risks & opportunities into risk management 
  • Understanding of climate risk & opportunity impacts in strategic planning
  • Risk assessment and management processes
  • Impact of identified risks and opportunities
  • Materiality assessment processes

94% of companies analyze climate risks, but only 14% conduct materiality assessments

Despite 94% of companies disclosing to have a process for analyzing risks and opportunities, only 14% disclose having a process to conduct materiality assessments. Conducting materiality assessments is essential for understanding the strategic, financial, and operational impacts of climate-related risk. A key aspect of materiality assessments involves understanding which parts of your value chain might be impacted by these risks and to what extent. Regulations increasingly require companies to produce materiality assessments to understand which risks are material to their companies and how they plan to mitigate those risks. Regulations such as CSRD, SEC Climate Disclosure Rule and even the CSSB’s proposed disclosure requirements require companies to perform materiality assessments.  

75% of organizations assess risks, but just 32% integrate risks into strategic business planning

Out of 350 companies analyzed, 75% disclosed having a risk assessment process and 69% disclosed having a management process for identified risks. To provide a complete picture of risk management, organizations should disclose processes for both identifying and managing risks. Also, while many organizations claim to address climate-related risks and opportunities, only 32% disclose the impacts of physical risks and their integration into strategic business planning. Climate change poses significant risks, including acute events like wildfires and storms, as well as chronic challenges like sea level rise, which can profoundly affect operations and require adaptation or mitigation measures. Failing to understand the impacts of physical risks can leave organizations vulnerable to disruptions and financial losses.

About half of companies disclose integrating climate risk to into broader risk management systems

Further, only 55% of organizations discuss integrating processes to identify, assess, and manage climate-related risks into their organization’s broader risk management system. Best practices recommend that organizations integrate climate-related risk management processes into their overall organizational framework to avoid siloed analysis separate from other business risks. Our analysis indicates that while most organizations have a process to analyze and identify key climate-related risks and opportunities, there is a lack of comprehensive management and integration of climate risks into organizational management systems.  

Organizations struggle to understand what “good” disclosures look like

From 2021 to 2023, we observed significant differences in disclosure reporting. In particular, organizations struggle to disclose materiality assessment processes effectively as demonstrated by limited disclosure on this topic. Benchmarking is a critical way to understand what industry leaders are doing and learn from best practice examples. Best-in-class disclosure examples show how organizations prioritize climate risks and assess them against broader business risks. Additionally, examining how industry peers develop processes or governance structures to integrate climate risk management into broader Enterprise Risk Management (ERM) programs can provide tangible and actionable insights.

How does Manifest Climate enable peer benchmarking?

With Manifest Climate, organizations can compare their climate disclosures against peers, identify gaps, and adopt best practices. This enhances the quality and effectiveness of climate risk disclosures, aligning with regulatory standards and investor demands while gaining a competitive edge in the marketplace. In short, Manifest Climate is the fastest way to access peer benchmarking intelligence for climate disclosures.

View best practice examples with Insights

For example, 55% of organizations in the Manifest Climate database disclose their process on materiality. Organizations seeking insight into how others disclose materiality processes can simply visit our Insights feature to see best practice examples. In Insights, organizations can select the action item “Materiality Assessment Process” to see how top-performing organizations disclose these assessments. Additionally, you can enter keywords in the search bar to refine your search.

Create a custom benchmark with Tracker

The Manifest Climate platform also allows you to dive into database examples directly in “Tracker”. For selected peers, you can create a custom benchmark to analyze peer disclosures. Simply navigate to Tracker, then select “create new table” and choose the name and data points you want to benchmark against, focusing on the four pillars: Governance, Strategy, Risk Management, and Metrics and Targets. Once your table is created, you can directly access organizations’ specific disclosures on each data point by clicking on the check mark symbol.

Unlock AI-powered benchmarking with Manifest Climate

Manifest Climate is an AI-powered platform that helps companies close disclosure gaps and supercharge their climate strategies. Our platform is the world’s best at assessing climate disclosures. We help to highlight your climate disclosure and management gaps across multiple standards and frameworks and provide data-driven recommendations for improvement. Our technology helps your team reduce time spent on manual research by 99%, improving precision and consistency as a result.