Why do companies need separate CDP and TCFD reports?

Most of the information found in the CDP report will be the same as that found in a TCFD report. However many companies, like Colgate-Palmolive, choose to prepare a TCFD report even when they already have a CDP report.

TCFD reports are typically used by investors, asset managers, and banks. Although they can get TCFD information from a company's CDP report, CDP reports are very lengthy (easily 50 pages and above). Hence, they may request a standalone TCFD report (usually 10–20 pages).

Although CDP is popular, it is not mandatory, thus many companies do not disclose their information to CDP. However, investors and regulators possess the authority to mandate that companies prepare a TCFD report.

Additionally, investors can push for companies to generate a CDP report, but regulators are not able to, as it breaches international trade rules (CDP is a private organisation and charges a fee to companies which use their services). Regulators can, however, mandate for companies to prepare a TCFD report because it is free.

It is useful to understand the differences between TCFD and CDP reports. While the two have considerable similarities, they were established with distinct objectives and fulfil different roles for various stakeholders.

	TCFD	CDP
What is its aim?	Created to enhance climate-related financial information reporting.	Runs a global disclosure system to help manage environmental impact across climate change, water security and deforestation.
Who is involved?	TCFD Framework recommends disclosure of information to help investors, lenders, and insurance underwriters appropriately assess and price risks related to climate change.	The CDP offers a platform for investors, companies, cities, states and regions with a platform to implement the TCFD Framework.
Is it mandatory?	Climate risk disclosure aligned with the TCFD is mandatory in the EU, Singapore, Canada, Japan, South Africa, and New Zealand.	Reporting to the CDP is not mandatory. Companies tend to make disclosures on CDP when requested to do so by investors.