CDP slashes workforce to address rising costs of upgrades and innovation

CDP, the most widely used platform for environmental disclosures, is laying off one-fifth of its workforce as it invests in innovations that the organization said will better serve disclosing companies and users of its data.

The organization did not provide specifics on which departments would be affected, beyond saying that the cuts will not be focussed on specific regions and will take place this year. As of March 2024, CDP employed 541 people in 15 countries, according to its most recent annual report.

The cuts come after a challenging year for the organization, which receives disclosures from more than 23,000 companies annually. A new questionnaire, which combined previously separate requests for information on climate, forests and water, proved time-consuming for companies to navigate, as did a new portal for submitting data. Annual scores assigned to companies by CDP — based on their disclosures and typically delivered before the winter holidays — were not sent out until February.

Rising costs

Operating costs have also been growing faster than income, noted Shannon Joly, CDP’s chief marketing and communications officer. The need to cut spending to address rising costs, together with the decision to shift spending toward improved technology and processes, is behind the layoffs, she said.

The overhaul of how CDP ingests and exports data will be driven by several new arrivals. Former Mastercard public policy lead Sherry Madera took over as CEO in October 2023. She has since brought in Ian Brocklehurst, a product and data expert with experience at the London Stock Exchange who now runs CDP’s product work, and Chief Growth Officer Kari Stoever, who has a background in external relations.

Joly said the organization aspires to cut the time it takes to submit to CDP by 70 percent. One strategy will be a “use case” approach to disclosure. Rather than asking all companies to answer a similar set of questions, CDP will tailor its requests to suit the needs of the disclosing company. That could mean focusing on the data required under the European Union’s Corporate Sustainability Reporting Directive or on a specific set of questions posed by a major investor. 

Global fragmentation

In parallel, Brocklehurst will modernize the systems that customers such as Bloomberg use to access information from CDP, which now holds what the organization says is the world’s largest collection of data on environmental action. “We need to make sure that we’re servicing clients as they would expect from any kind of data provider,” said Joly. The platform used for public access to CDP disclosures, which has been unavailable for several months, will be open again in coming months, she added.

Providing streamlined access to sustainability data is particularly important at a moment when policies and standards relating to disclosure are in flux, noted Joly. “We’re operating in a world of more and more global fragmentation,” Joly said, which reinforces the need for CDP to retain its position as a provider of a “global, independent baseline” for sustainability data.