Roughly one in four organizations reporting through CDP have adopted climate transition plans aligned with capping global warming at 1.5 degrees Celsius above the pre-industrial average, according to a report Wednesday by CDP (formerly the Carbon Disclosure Project) looking at 23,200 organizations from 14 industries across 129 countries in 2023. A total 5,906 companies reported adopting such plans—an increase of 44% since 2022—and an additional 8,200 companies (36%) said they plan to create one by 2025.

CDP is a global non-profit that runs the largest voluntary environmental reporting platform in the world. Over 700 financial institutions with more than $142 trillion in assets under management use CDP to collect sustainability data for their portfolio companies. 

To assess the credibility of climate transition plans, CDP has selected 21 climate transition plan key indicators it encourages companies to provide, including emissions data from across the supply chain, clarity on any assurance provided, and the degree of board oversight.

The report revealed that 39% of the companies that report having a climate transition plan are already disclosing against most (at least two thirds) of the 21 key indicators. However, just 1% of companies that report having a transition plan are currently disclosing to all key indicators. According to CDP, key barriers include complete strategy, target setting, and financial planning.