The carbon disclosure project, an evolution in international environmental corporate governance : motivations and determinants of market response to voluntary disclosures

This paper examines the factors associated with Canadian firms voluntarily disclosing climate change information through the Carbon Disclosure Project. Five hypotheses are presented to explain the factors influencing management's decision to disclose this information. These hypotheses include a response to shareholder activism, domestic institutional investor shareholder activism, signalling, litigation risk, and low cost publicity. Both binary logistic regressions as well as a cross-sectional analysis of the equity market's response to the environmental disclosures being made were used to test these hypotheses. Support was found for shareholder activism, low cost publicity, and litigation risk. However, the equity market's response was not found to be statistically significant.

Soil Nitrogen and Carbon Management Project, 2002

Report produced by Iowa Departmment of Agriculture and Land Stewardship

Responding to the EU Emissions Trading Scheme: an empirical analysis of corporate carbon disclosure strategy

The purpose of this paper is to explore how companies that hold carbon trading accounts under European Union Emissions Trading Scheme (EU ETS) respond to the climate change by using disclosures on carbon emissions as a means to generate legitimacy compared to others. The study is based on disclosures made in annual reports and stand-alone sustainability reports of UK listed companies from 2001- 2012. The study uses content analysis to capture both the quality and volume of the carbon disclosures. The results show that there is a significant increase in both the quality and volume of the carbon disclosures after the launch of EU ETS. Companies with carbon trading accounts provide greater detailed disclosures as compared to the others without an account. We also find that company size is positively correlated with the disclosures while the association with the industry produces an inconclusive result.

A longitudinal study of carbon disclosure strategy: evidence from utility, energy and mining industries in the UK

The paper investigates how energy-intensive industries respond to the recent government-led carbon emission schemes through the content analysis of 306 annual and standalone reports of 25 UK listed companies from 2004 to 2012. This period of reporting captures the trend and development of corporate disclosures on carbon emissions after the launch of EU Emissions Trading Schemes (ETS) and Climate Change Act (CCA) 2008. It is found that in corresponding to strategic legitimacy theory, there is an increase in both the quality and quantity of carbon disclosures as a response to these initiatives. However, the change is gradual, which reflects in the achievement of peak disclosure period two years after the launch. It indicates that the new legislations have a lasting impact on the discourses rather than an immediate legitimacy threat from the perspective of institutional legitimacy theory. The results also show that carbon disclosures are an institutionalised practice as companies in the same industries and/or with same carbon trading account status appear to imitate and adopt the industry’s ‘best practice’ disclosure strategy to maintain legitimacy. The trend analysis suggests that the overall disclosure practice is still in its infant stage, especially in the reporting of quantitative and monetary items. The paper contributes to the social and environmental accounting literature by adopting both strategic and institutional view of legitimacy, which explains why carbon disclosures evolve in a specific way to meet the expectation of various stakeholders.

Progress report on longitudinal and cross-sectional study of carbon disclosure strategies: evidence from UK listed companies

Global warming has attracted attention from all over the world and led to the concern about carbon emission. Kyoto Protocol, as the first major international regulatory emission trading scheme, was introduced in 1997 and outlined the strategies for reducing carbon emission (Ratnatunga et al., 2011). As the increased interest in carbon reduction the Protocol came into force in 2005, currently there are already 191 nations ratifying the Protocol(UNFCCC, 2012). Under the cap-and-trade schemes, each company has its carbon emission target. When company’s carbon emission exceeds the target the company will either face fines or buy emission allowance from other companies. Thus unlike most of the other social and environmental issues carbon emission could trigger cost for companies in introducing low-emission equipment and systems and also emission allowance cost when they emit more than their targets. Despite the importance of carbon emission to companies, carbon emission reporting is still operating under unregulated environment and companies are only required to disclose when it is material either in value or in substances (Miller, 2005, Deegan and Rankin, 1997). Even though there is still an increase in the volume of carbon emission disclosures in company’s financial reports and stand-alone social and environmental reports to show their concern of the environment and also their social responsibility (Peters and Romi, 2009), the motivations behind corporate carbon emission disclosures and whether carbon disclosures have impact on corporate environmental reputation and financial performance have not yet to explore. The problems with carbon emission lie on both the financial side and non-financial side of corporate governance. On one hand corporate needs to spend money in reducing carbon emission or paying penalties when they emit more than allowed. On the other hand as the public are more interested in environmental issues than before carbon emission could also impact on the image of corporate regarding to its environmental performance. The importance of carbon emission issue are beginning to be recognized by companies from different industries as one of the critical issues in supply chain management (Lee, 2011) and 80% of companies analysed are facing carbon risks resulting from emissions in the companies’ supply chain as shown in a study conducted by the Investor Responsibility Research Centre Institute for Corporate Responsibility (IRRCI) and over 80% of the companies analysed found that the majority of greenhouse gas (GHG) emission are from electricity and other direct suppliers (Trucost, 2009). The review of extant literature shows the increased importance of carbon emission issues and the gap in the study of carbon reporting and disclosures and also the study which links corporate environmental reputation and corporate financial performance with carbon reporting (Lohmann, 2009a, Ratnatunga and Balachandran, 2009, Bebbington and Larrinaga-Gonzalez, 2008). This study would focus on investigating the current status of UK carbon emission disclosures, the determinant factors of corporate carbon disclosure, and the relationship between carbon emission disclosures and corporate environmental reputation and financial performance of UK listed companies from 2004-2012 and explore the explanatory power of classical disclosure theories.

The drivers of corporate climate change strategies and public policy: a new resource-based view perspective

Effective public policy to mitigate climate change footprints should build on data-driven analysis of firm-level strategies. This article’s conceptual approach augments the resource-based view (RBV) of the firm and identifies investments in four firm-level resource domains (Governance, Information management, Systems, and Technology [GISTe]) to develop capabilities in climate change impact mitigation. The authors denote the resulting framework as the GISTe model, which frames their analysis and public policy recommendations. This research uses the 2008 Carbon Disclosure Project (CDP) database, with high-quality information on firm-level climate change strategies for 552 companies from North America and Europe. In contrast to the widely accepted myth that European firms are performing better than North American ones, the authors find a different result. Many firms, whether European or North American, do not just “talk” about climate change impact mitigation, but actually do “walk the talk.” European firms appear to be better than their North American counterparts in “walk I,” denoting attention to governance, information management, and systems. But when it comes down to “walk II,” meaning actual Technology-related investments, North American firms’ performance is equal or superior to that of the European companies. The authors formulate public policy recommendations to accelerate firm-level, sector-level, and cluster-level implementation of climate change strategies.

Does stakeholder pressure influence corporate GHG emissions reporting? Empirical evidence from Europe

Purpose – The purpose of this paper is to seek to shed light on the practice of incomplete corporate disclosure of quantitative Greenhouse gas (GHG) emissions and investigates whether external stakeholder pressure influences the existence, and separately, the completeness of voluntary GHG emissions disclosures by 431 European companies. Design/methodology/approach – A classification of reporting completeness is developed with respect to the scope, type and reporting boundary of GHG emissions based on the guidelines of the GHG Protocol, Global Reporting Initiative and the Carbon Disclosure Project. Logistic regression analysis is applied to examine whether proxies for exposure to climate change concerns from different stakeholder groups influence the existence and/or completeness of quantitative GHG emissions disclosure. Findings – From 2005 to 2009, on average only 15 percent of companies that disclose GHG emissions report them in a manner that the authors consider complete. Results of regression analyses suggest that external stakeholder pressure is a determinant of the existence but not the completeness of emissions disclosure. Findings are consistent with stakeholder theory arguments that companies respond to external stakeholder pressure to report GHG emissions, but also with legitimacy theory claims that firms can use carbon disclosure, in this case the incomplete reporting of emissions, as a symbolic act to address legitimacy exposures. Practical implications – Bringing corporate GHG emissions disclosure in line with recommended guidelines will require either more direct stakeholder pressure or, perhaps, a mandated disclosure regime. In the meantime, users of the data will need to carefully consider the relevance of the reported data and develop the necessary competencies to detect and control for its incompleteness. A more troubling concern is that stakeholders may instead grow to accept less than complete disclosure. Originality/value – The paper represents the first large-scale empirical study into the completeness of companies’ disclosure of quantitative GHG emissions and is the first to analyze these disclosures in the context of stakeholder pressure and its relation to legitimation.

Modelled soil organic carbon stocks and changes in the Indo-Gangetic Plains, India from 1980 to 2030

The Global Environment Facility co-financed Soil Organic Carbon (GEFSOC) Project developed a comprehensive modelling system for predicting soil organic carbon (SOC) stocks and changes over time. This research is an effort to predict SOC stocks and changes for the Indian, Indo-Gangetic Plains (IGP), an area with a predominantly rice (Oryza sativa) - wheat (Triticum aestivum) cropping system, using the GEFSOC Modelling System and to compare output with stocks generated using mapping approaches based on soil survey data. The GEFSOC Modelling System predicts an estimated SOC stock for the IGP, India of 1.27, 1.32 and 1.27 Pg for 1990, 2000 and 2030, respectively, in the top 20 cm of soil. The SOC stock using a mapping approach based on soil survey data was 0.66 and 0.88 Pg for 1980 and 2000, respectively. The SOC stock estimated using the GEFSOC Modelling System is higher than the stock estimated using the mapping approach. This is due to the fact that while the GEFSOC System accounts for variation in crop input data (crop management), the soil mapping approach only considers regional variation in soil texture and wetness. The trend of overall change in the modelled SOC stock estimates shows that the IGP, India may have reached an equilibrium following 30-40 years of the Green Revolution. This can be seen in the SOC stock change rates. Various different estimation methods show SOC stocks of 0.57-1.44 Pg C for the study area. The trend of overall change in C stock assessed from the soil survey data indicates that the soils of the IGP, India may store a projected 1.1 Pg of C in 2030. (C) 2007 Elsevier B.V. All rights reserved.

Global Ocean Colour for Carbon Cycle Research (full product set)

In 2005, the International Ocean Colour Coordinating Group (IOCCG) convened a working group to examine the state of the art in ocean colour data merging, which showed that the research techniques had matured sufficiently for creating long multi-sensor datasets (IOCCG, 2007). As a result, ESA initiated and funded the DUE GlobColour project (http://www.globcolour.info/) to develop a satellite based ocean colour data set to support global carbon-cycle research. It aims to satisfy the scientific requirement for a long (10+ year) time-series of consistently calibrated global ocean colour information with the best possible spatial coverage. This has been achieved by merging data from the three most capable sensors: SeaWiFS on GeoEye's Orbview-2 mission, MODIS on NASA's Aqua mission and MERIS on ESA's ENVISAT mission. In setting up the GlobColour project, three user organisations were invited to help. Their roles are to specify the detailed user requirements, act as a channel to the broader end user community and to provide feedback and assessment of the results. The International Ocean Carbon Coordination Project (IOCCP) based at UNESCO in Paris provides direct access to the carbon cycle modelling community's requirements and to the modellers themselves who will use the final products. The UK Met Office's National Centre for Ocean Forecasting (NCOF) in Exeter, UK, provides an understanding of the requirements of oceanography users, and the IOCCG bring their understanding of the global user needs and valuable advice on best practice within the ocean colour science community. The three year project kicked-off in November 2005 under the leadership of ACRI-ST (France). The first year was a feasibility demonstration phase that was successfully concluded at a user consultation workshop organised by the Laboratoire d'Océanographie de Villefranche, France, in December 2006. Error statistics and inter-sensor biases were quantified by comparison with insitu measurements from moored optical buoys and ship based campaigns, and used as an input to the merging. The second year was dedicated to the production of the time series. In total, more than 25 Tb of input (level 2) data have been ingested and 14 Tb of intermediate and output products created, with 4 Tb of data distributed to the user community. Quality control (QC) is provided through the Diagnostic Data Sets (DDS), which are extracted sub-areas covering locations of in-situ data collection or interesting oceanographic phenomena. This Full Product Set (FPS) covers global daily merged ocean colour products in the time period 1997-2006 and is also freely available for use by the worldwide science community at http://www.globcolour.info/data_access_full_prod_set.html. The GlobColour service distributes global daily, 8-day and monthly data sets at 4.6 km resolution for, chlorophyll-a concentration, normalised water-leaving radiances (412, 443, 490, 510, 531, 555 and 620 nm, 670, 681 and 709 nm), diffuse attenuation coefficient, coloured dissolved and detrital organic materials, total suspended matter or particulate backscattering coefficient, turbidity index, cloud fraction and quality indicators. Error statistics from the initial sensor characterisation are used as an input to the merging methods and propagate through the merging process to provide error estimates for the output merged products. These error estimates are a key component of GlobColour as they are invaluable to the users; particularly the modellers who need them in order to assimilate the ocean colour data into ocean simulations. An intensive phase of validation has been undertaken to assess the quality of the data set. In addition, inter-comparisons between the different merged datasets will help in further refining the techniques used. Both the final products and the quality assessment were presented at a second user consultation in Oslo on 20-22 November 2007 organised by the Norwegian Institute for Water Research (NIVA); presentations are available on the GlobColour WWW site. On request of the ESA Technical Officer for the GlobColour project, the FPS data set was mirrored in the PANGAEA data library.

Economics of Power-to-Gas integration to wastewater treatment plant

Solar and wind power produce electricity irregularly. This irregular power production is problematic and therefore production can exceed the need. Thus sufficient energy storage solutions are needed. Currently there are some storages, such as flywheel, but they are quite short-term. Power-to-Gas (P2G) offers a solution to store energy as a synthetic natural gas. It also improves nation’s energy self-sufficiency. Power-to-Gas can be integrated to an industrial or a municipal facility to reduce production costs. In this master’s thesis the integration of Power-to-Gas technologies to wastewater treatment as a part of the VTT’s Neo-Carbon Energy project is studied. Power-to-Gas produces synthetic methane (SNG) from water and carbon dioxide with electricity. This SNG can be considered as stored energy. Basic wastewater treatment technologies and the production of biogas in the treatment plant are studied. The utilisation of biogas and SNG in heat and power production and in transportation is also studied. The integration of the P2G to wastewater treatment plant (WWTP) is examined mainly from economic view. First the mass flows of flowing materials are calculated and after that the economic impact based on the mass flows. The economic efficiency is evaluated with Net Present Value method. In this thesis it is also studied the overall profitability of the integration and the key economic factors.

Belize: effects of climate change on agriculture

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Validation and comparison of two soil-vegetation-atmosphere transfer models for tropical Africa

This study aims to compare and validate two soil-vegetation-atmosphere-transfer (SVAT) schemes: TERRA-ML and the Community Land Model (CLM). Both SVAT schemes are run in standalone mode (decoupled from an atmospheric model) and forced with meteorological in-situ measurements obtained at several tropical African sites. Model performance is quantified by comparing simulated sensible and latent heat fluxes with eddy-covariance measurements. Our analysis indicates that the Community Land Model corresponds more closely to the micrometeorological observations, reflecting the advantages of the higher model complexity and physical realism. Deficiencies in TERRA-ML are addressed and its performance is improved: (1) adjusting input data (root depth) to region-specific values (tropical evergreen forest) resolves dry-season underestimation of evapotranspiration; (2) adjusting the leaf area index and albedo (depending on hard-coded model constants) resolves overestimations of both latent and sensible heat fluxes; and (3) an unrealistic flux partitioning caused by overestimated superficial water contents is reduced by adjusting the hydraulic conductivity parameterization. CLM is by default more versatile in its global application on different vegetation types and climates. On the other hand, with its lower degree of complexity, TERRA-ML is much less computationally demanding, which leads to faster calculation times in a coupled climate simulation.

Climate and carbon cycle changes from 1850 to 2100 in MPI-ESM simulations for the Coupled Model Intercomparison Project phase 5

The new Max-Planck-Institute Earth System Model (MPI-ESM) is used in the Coupled Model Intercomparison Project phase 5 (CMIP5) in a series of climate change experiments for either idealized CO2-only forcing or forcings based on observations and the Representative Concentration Pathway (RCP) scenarios. The paper gives an overview of the model configurations, experiments related forcings, and initialization procedures and presents results for the simulated changes in climate and carbon cycle. It is found that the climate feedback depends on the global warming and possibly the forcing history. The global warming from climatological 1850 conditions to 2080–2100 ranges from 1.5°C under the RCP2.6 scenario to 4.4°C under the RCP8.5 scenario. Over this range, the patterns of temperature and precipitation change are nearly independent of the global warming. The model shows a tendency to reduce the ocean heat uptake efficiency toward a warmer climate, and hence acceleration in warming in the later years. The precipitation sensitivity can be as high as 2.5% K−1 if the CO2 concentration is constant, or as small as 1.6% K−1, if the CO2 concentration is increasing. The oceanic uptake of anthropogenic carbon increases over time in all scenarios, being smallest in the experiment forced by RCP2.6 and largest in that for RCP8.5. The land also serves as a net carbon sink in all scenarios, predominantly in boreal regions. The strong tropical carbon sources found in the RCP2.6 and RCP8.5 experiments are almost absent in the RCP4.5 experiment, which can be explained by reforestation in the RCP4.5 scenario.

Inorganic carbon and geochemistry measurements from landfast sea ice in Resolute Passage, Nunavut, Canada, as part of the Arctic-ICE project, May - June 2010

We conducted a six-week investigation of the sea ice inorganic carbon system during the winter-spring transition in the Canadian Arctic Archipelago. Samples for the determination of sea ice geochemistry were collected in conjunction with physical and biological parameters as part of the 2010 Arctic-ICE (Arctic - Ice-Covered Ecosystem in a Rapidly Changing Environment) program, a sea ice-based process study in Resolute Passage, Nunavut. The goal of Arctic-ICE was to determine the physical-biological processes controlling the timing of primary production in Arctic landfast sea ice and to better understand the influence of these processes on the drawdown and release of climatically active gases. The field study was conducted from 1 May to 21 June, 2010.