Businesses working on how to report their sustainability data are focused on the handful of mandatory reporting standards coming from regulators around the globe, but there is another project that might be worth watching—the net zero data public utility, or NZDPU. 

It aims to create a free-to-all platform of reliable, comparable corporate climate data across industries and jurisdictions that can be used by governments, civil society, media, investors and other observers. It will initially include a detailed breakdown of emissions in a company’s value chain and its corporate reduction targets. 

“The most valuable currency in financial markets is reliable data,” said Michael Bloomberg, who built the Bloomberg data business and also funded NZDPU through his philanthropy. “That was the founding principle behind the launch of Bloomberg (data company) and it certainly holds true when it comes to financing the fight against climate change.”

NZDPU will eventually be part of the United Nations’ Global Climate Action Portal. Bloomberg said NZDPU should show which businesses are cutting emissions, where there are opportunities to do more and help end so-called greenwashing by empowering the public to hold companies accountable to back up their words with action. 

WSJPro got an exclusive look at the NZDPU proof of concept ahead of it launch this weekend at the COP28 climate summit. The online platform includes the detailed carbon footprint and emission reduction targets for nearly 400 companies by year and over time. It also allows users to create custom tables comparing across companies and to download the information. A public consultation on the tool will be open until March 1, 2024.

Investors also see the potential. “The ambition of the NZDPU to create a verifiable, centralized, open-source data repository signals the nirvana of climate data,” said Claire Hedley, ESG Director at 17Capital, a global private credit provider. “The lack of consistent, quality, and accessible emissions data remains one of the biggest challenges for the successful implementation of net zero and climate transition plans.” 

“I think it’s important to have a platform where we share all the [sustainability] information. Transparency is critical,” said Lorena Dellagiovanna, Chief Sustainability Officer at Hitachi, a global industrial conglomerate.

Mandatory climate reporting rules are coming in Europe, the U.S. and internationally. Standard setters have tried to minimize differences, but reconciling climate data into a comparable format is likely to remain a formidable task. That has been a focus of the NZDPU’s Climate Data Steering Committee which includes representatives from financial regulators, reporting standards setters, international organizations and data companies including CDP, Morningstar and MSCI. Established by French President Emmanuel Macron and Michael Bloomberg, the committee is chaired by Mary Schapiro—who previously led the Securities and Exchange Commission, Sustainability Accounting Standards Board and Task Force on Climate-Related Financial Disclosures

It is a “peerless group of standard setters and policy makers and government officials” interested in seeing the highest quality, most accessible data made available to everyone, Schapiro said.

“Maybe it’s a little bit cart before the horse in the sense that we had the [climate data] disclosure requirements before we had a utility, but now we’re rapidly catching up,” Schapiro said, adding they will iterate to include more companies and data points over time.

Nellie Liang, undersecretary for Domestic Finance at the U.S. Treasury said the NZDPU would give financial market participants “access to climate-related data that can help them make better informed investment and financing decisions.”

NZDPU’s data currently comes from a collaboration with CDP, an existing disclosure platform with climate data from more than 23,000 companies worth 66% of global market capitalization. “As a community, we need to work together to improve standardization, ensure all stakeholders have the data they need and ensure companies do not have to undergo duplicative reporting through different platforms,” said Nicolette Bartlett, chief impact officer at CDP.

17Capital’s Hedley said, “The backing of the CDSC [Climate Data Steering Committee] and partnership with the CDP are encouraging but ongoing strategic collaboration with the public and private sectors, as well as standard setters and policy makers, will be crucial to overcome challenges and ensure the initiative’s success.”

Write to Rochelle Toplensky at [email protected]