Climate leadership drives higher growth as Japan sets the global pace

A growing cohort of global organisations is demonstrating that environmental leadership is translating into measurable business and organisational returns, according to the CDP Corporate Health Check 2026.

The report found that just 15% of organisations worldwide are embedding climate and nature considerations into core business decisions. Yet these organisations are outperforming their peers, cutting emissions at four times the rate of lower-performing organisations and collectively unlocking US$218 billion in financial opportunities over the past 12 months. On average, environmental leaders reduced emissions at a CAGR of 4%, compared with just 1% among other organisations.

Now in its second year and developed in collaboration with Oliver Wyman, the annual health check draws on disclosures from more than 10,000 organisations globally. This year’s analysis goes beyond tracking environmental progress to examine how sustainability performance is shaping financial outcomes across regions and sectors, reinforcing the growing link between environmental leadership, governance, and long-term workforce resilience.

Despite ongoing geopolitical tensions and economic uncertainty, corporate environmental leadership continues to gather pace. In 2025, 15% of organisations achieved CDP’s Leadership level in at least one environmental theme—climate, water, or forests. Climate remains the most advanced area, with 13% of organisations reaching Leadership status, followed by water (11%) and forests (8%).

The financial case is also strengthening. Since 2022, organisations at the highest performance level have recorded stronger market capitalisation growth than peers across several sectors, including financial services (30 vs. 19%), infrastructure (19% vs. 17%), and apparel (16% vs. 2%).

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Regionally, the report highlighted widening divergence. Japan has emerged as a global leader, with 22% of organisations achieving Leadership status on climate, ahead of the UK (17%) and the EU (16%). Japan is also the only country where more than 10% of organisations lead across climate, water, and forests, capturing US$76 billion in new climate-related opportunities over the past year alone.

Sherry Madera, Chief Executive Officer at CDP, said: “Climate and nature loss are no longer distant risks—they are already reshaping markets, supply chains and investment decisions. The 2026 Corporate Health Check shows that organisations applying earth-positive economics are turning environmental data into better business outcomes. By measuring and managing these pressures, leaders are allocating capital more effectively, strengthening resilience and unlocking tangible financial value, even amid global uncertainty.”

“Earth-positive is no longer peripheral to business strategy; it is becoming a core driver of long-term competitiveness. The challenge now is scale—making this the norm rather than the exception.”