Every year, Corporate Knights, a Toronto-based media and investment advisory company publishes the Global 100 Index, which basically ranks the world’s 100 most sustainable corporations. Determining a globally acceptable index is challenging as corporations are highly complex institutions spanning across multiple countries and industries.
Started in 2005, the concept of corporate sustainability is broken down in measurable components. The qualifying entries are then scored on a percentage basis and ranked against their industry peers on a list of 12 key performance indicators. These KPIs are based on energy and water use, to employee compensation and corporate tax strategy.
To be even included on the index, the corporations must go through a 4 stage screening process.
- Industry specific sustainability disclosure. Companies that fail to disclose at least 75% of the “priority indicators” for their specific industry are eliminated.
- F-score. To sum it up, it is basically the corporations economic performance across 9 different criteria.
- Product categories. Corporations in the tobacco industry and corporations that derives revenue from “defense” are eliminated.
- Sanctions. After going through the first 3 screenings, the final elimination will be determined based on the corporation’s sustainability related fines and penalties against their revenue.
After this the final 100 corporations will be ranked from the highest percentage to the lowest.
You can view 2015’s 100 Most Sustainable Corporations by clicking on this link.