The RADIAL COMPANY DIAGRAMS show the 8 clusters of issues (as discovered in the Basemap), and shows the distribution of these issue clusters per company.
This gives a quick sense of the pulse of climate risk disclosure company by company and sector by sector across the 5 industry sectors. The diagrams represent both the type of language each company is using in their 10-K disclosure filings (the cluster they mobilize to discuss climate risk) and the "volume" of terms they use within a given cluster (represented by the size of the pie slice--a rough proxy of the size of their climate risk disclosure filing as extracted by CookESG Research’s algorithms). We also further organized the companies into sub-industry categories, as classified in their SEC filings, to provide for more apples to apples comparisons.
This series of graphs gives a fairly quick comparative handle between companies and lets you see the variability in size of disclosures and the broad family of issues discussed in the disclosures. For instance, in the Oil and Gas sector, large companies such as Exxon Mobil and Occidental stick out for having very little to say about related to climate-risk, whereas much smaller extraction companies such as CVR Energy or Alon Energy find the room and resources to tell investors more specifically about the risks their business faces from potential GHG legislation and regulation.
However, without a finer grained understanding of the content of the filings, it’s hard to draw major conclusions from these diagrams because it is hard to equate volume with substance. Many of these disclosures contain a good deal of boilerplate that is fairly generic. But this “measure of meaningfulness” problem also cuts the other way. Among the Electricity and Coal sector companies, for instance, while it looks like Blackhills and Calphine Corp’s disclosures are dominated by regulatory considerations, a closer read reveals substantial discussion of physical effects of climate change on corporate performance and, in the case of Black Hills, also the impact on demand and production. Likewise, with Hawaiian Electric Industries.
One group of corporations that standout for the near uniformity of their profiles are the insurance companies. With very few exceptions (e.g. Aspen Insurance Holdings or Travelers Companies), large groups such as Chubb Corp say virtually nothing about physical climate risk and thus would appear from their disclosures to be less prepared for the potential impacts of climate change.
A next step in this kind of analysis would be try and compare similar “volume” profiles across risk clusters (i.e. match companies who are disclosing the same amount of text, even if across different sectors), as well as include another layer of data about where the actual text is coming from within the 10-k forms. Disclosures made in the "MD&A" section tend to be far more company-specific than disclosures made in the "risk factor" sections. This could help differentiate more meaningful disclosures from the boilerplate variety.