For many companies, CDP disclosure was once treated as an annual sustainability task. Teams collected emissions data, completed the questionnaire, submitted the response, and waited for the score. In 2026, that approach is no longer enough.

CDP, formerly known as the Carbon Disclosure Project, has become an important environmental disclosure platform used by investors, customers, lenders, procurement teams, and regulators. It helps stakeholders understand how a business manages climate-related and nature-related risks. The focus is shifting from simply reporting environmental data to proving that the company has strong governance, reliable data, practical targets, and clear action plans.

What Is CDP?

CDP is a global disclosure system that allows companies to report environmental information related to climate change, water security, forests, biodiversity, plastics, and other nature-related topics. Through CDP, organizations share details about greenhouse gas emissions, climate risks, environmental opportunities, business strategy, board oversight, targets, and progress.

The purpose of CDP is not only to create transparency. It helps companies understand their environmental impact and prepare for future business risks. A well-prepared CDP response can support customer confidence, investor trust, supplier qualification, and stronger internal decision-making.

For example, a manufacturing company may disclose emissions from its factories, electricity use, suppliers, transport, and product lifecycle. A food and beverage company may also need to report water use, deforestation risks, agricultural sourcing, and biodiversity impact. This shows that CDP is no longer limited to carbon alone. Organizations beginning their disclosure journey can benefit from understanding the fundamentals through a practical guide to CDP disclosure.

Key Changes in 2026

One of the major changes in CDP is the move toward a more integrated environmental questionnaire. Instead of treating climate, water, forests, and nature as separate topics, CDP now encourages companies to look at environmental issues together. This is important because business risks are often connected. Climate change can affect water availability, water stress can disrupt operations, and deforestation can create supply chain and reputational risks.

In 2026, CDP is also expanding its focus beyond climate change. Topics such as biodiversity, plastics, forests, water security, and oceans are becoming more relevant. This means companies may need to provide broader information about how their operations and value chains affect natural resources.

Another important development is the increasing expectation for better data quality. General statements are no longer enough. Businesses need clear calculations, defined reporting boundaries, evidence-based targets, and documented methodologies. Stakeholders want data that is consistent, comparable, and useful for decision-making.

Small and medium-sized enterprises may also feel the impact of CDP changes. Large companies are asking suppliers for more environmental information because supply chain emissions and nature-related risks are becoming part of corporate reporting. As a result, smaller suppliers may need to start preparing emissions data, water-related information, and basic environmental policies. Companies are increasingly expected to align environmental disclosures with broader sustainability frameworks such as GRI, TCFD and CDP frameworks.

Why CDP Matters for Businesses

CDP is becoming directly linked to business performance. Many customers now prefer suppliers that can provide reliable sustainability data. Investors want to understand whether companies are prepared for climate risk. Procurement teams use CDP responses to evaluate supplier responsibility. Regulators are also moving toward more structured sustainability reporting.

A strong CDP response can help a company show that it understands environmental risks and is taking action. It can also help identify cost-saving opportunities, such as reducing energy use, improving resource efficiency, and managing supply chain risks. Strong disclosure depends on reliable emissions measurement supported by a robust carbon accounting workflow and accurate GHG reporting processes.

On the other hand, weak disclosure can create business challenges. Poor data quality, lack of targets, unclear governance, or limited supplier engagement may affect customer confidence and investor perception. In some industries, it may also reduce the chances of qualifying for major contracts. Research continues to show how carbon disclosure can support business growth and profitability through stronger stakeholder confidence and risk management.

How Companies Should Prepare for 2026 and 2027

Companies should begin by identifying which CDP topics are relevant to their business. Climate change will apply to most organizations, but water, forests, plastics, biodiversity, and oceans may also be important depending on the sector, location, products, and supply chain.

The next step is to build a strong data collection process. Sustainability teams should not work alone. Finance, procurement, operations, facilities, logistics, risk, legal, and leadership teams should all contribute. CDP reporting requires accurate information from across the business.

Companies should also focus on Scope 3 emissions. These are emissions from the value chain, including suppliers, transport, purchased goods, product use, and waste. Scope 3 data is often difficult to collect, but it is becoming increasingly important for customers, investors, and climate targets.

Governance is another key requirement. Businesses should define who is responsible for environmental performance, how risks are reviewed, and how progress is monitored. Board-level oversight and senior management involvement can make the CDP response stronger and more credible.

Most importantly, companies should connect disclosure with real action. CDP is not only asking what the company emits. It is also asking whether the company has reduction plans, climate targets, risk management processes, supplier engagement, and measurable progress.

Conclusion

The direction of CDP in 2026 and 2027 is clear. Environmental disclosure is becoming broader, more detailed, and more business-critical. Companies can no longer treat CDP as a last-minute reporting activity. It should be used as a framework to improve data quality, manage risks, strengthen customer trust, and prepare for future sustainability requirements.

CDP is no longer only about carbon disclosure. It is about showing that a business understands its environmental responsibilities and is ready to act. Businesses should also stay informed about recent CDP reporting updates that continue to shape disclosure requirements and sustainability expectations.