Nestle, Nike, GSK ‘Deserve Place’ in Sustainability Rankings
Campbell’s, Danone, General Electric, Glaxosmithkline, HP, Intel, Nestlé,
Nike, Panasonic, Siemens, and Unilever are the companies most deserving of their top places within sustainability rankings, according to sustainability advisor Two Tomorrows.
They all were rated Aaa in the Tomorrow’s Value Rating 2011. The report aims to uncover which of 92 companies widely recognised as sustainability leaders deserve that accolade, and are likely to deliver long-term investment value.
Bringing up the rear in the C category – deemed least likely to deliver long-term value – were American Express, BNP Paribas, CVS Caremark and Yum!, the parent company of Taco Bell, Pizza Hut and KFC.
For the report, Two Tomorrows compiled a list of companies that appear on three or more leading sustainability rankings. To this they added Fortune Global 100 companies that appear on two rankings. The consultancy then evaluated the companies’ governance structures, commitment to innovation, stakeholder engagement process and management along the entire value chain, based on annual reports and accounts, sustainability reports, and information on companies’ websites.
The rankings divide the companies into eight bands: Aaa, Aa, Baa, Ba, B, Caa, Ca and C. This shows, Two Tomorrows says, which companies will be able to deliver on their sustainability promises.
Two Tomorrows said every company on the list had outstanding examples of putting corporate responsibility into action, from eco-efficiency to community support. But it said the companies in the first three grades are “walking the talk,” having all described management approaches that enable them to continue to deliver such sustainability programs.
The company said its ratings also revealed several emerging trends in corporate sustainability, along with the leaders in those fields. Nike has demonstrated global leadership in innovation through an open-source approach to product design, Two Tomorrows said, while Danone has developed a responsible value chain through direct engagement with suppliers.
Swiss Re is exemplifying the way that the very best companies embed sustainability in core decision-making, the report said. The reinsurer’s Sustainability Risk Framework formally identifies and addresses environmental, social and governance risks. When any of these risks are present, a mandatory process has to be followed before the company will proceed with a transaction.
Two Tomorrows said there is a danger that companies are taking existing practices and passing them under the sustainability lens to create a green picture of the company. This “fundamentally profit driven” practice can turn to greenwash if companies ignore tricky issues, Two Tomorrows said. Gap has demonstrated that it is facing challenges head-on, by addressing tough questions on its website, the report said.
Two Tomorrows also warned that some companies are making changes without a real sense of direction, and said the firms in the study demonstrated a surprising lack of meaningful targets, leaving stakeholders unable to judge if companies have successfully met their sustainability commitments.
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