May 2014



Newsweek’s “Green Rankings” is back

Written by , Posted in Corporate Rankings, Sustainability

FireShot Pro Screen Capture #340 - 'Newsweek Green Rankings 2012_ U_S_ 500 List - Newsweek' - www_newsweek_com_2012_10_22_newsweek-green-rankings-2012-u-s-500-list_html

After a long process of methodological refinement of its flagship ranking, Newsweek will restart to publish the new edition of its “Green Rankings” on June 5th. This ranking is one of the most important environmental rankings worldwide and left quite a gap, when it disappeared from the scene in 2013.

After its last appearance in 2012, Trucost pulled the plug and thus left Sustainalytics as the only research partner behind. I expected Sustainalytics to find a solution to compensate for the loss, but obviously this did not work out. New research partner now is Corporate Knights. Well known through its ranking “Global 100 top sustainable companies of the World” or “Global 100 Index“ as it is called now and which was last published in January this year during the World Economic Forum in Davos.

Similar to past publications, Newsweek will publish two lists with the 500 biggest publicly traded companies, a global list and a US –related one. It’ s not unusual for a US magazine to include a US centric list however, in this case the huge performance gap between European and US companies might have played an important role too (In 2012, only one US company made it into the global top 20). With the new research partner a new methodology has come along which will probably lead to significant changes in the results compared to 2012. I assume that Newsweek will not even publish the rank change vs 2012 to make clear that this would be like comparing Apple with Oranges or Waste Water with GHG to stay in the picture.

The new methodology follows six core principles:

  1. Transparency (of the method)
  2. Objectivity (quantitative data)
  3. Public data (Annual Reports, News articles),
  4. Comparability (Companies are benchmarked against their industry peers)
  5. Engagement (companies can check the data)
  6. Stakeholders (well known CR experts are involved such as John Elkington or Ernst Ligteringen.

Unsurprisingly, the revised methodology contains a significant junk of CKs “Global Top 100 Index” indicators. Half of the eight indicators are identical with the ones used in the Global Top 100 index (Productivity in Energy, GHG, Water, Waste) the other four are Reputation (based on RepRisk scores), Pay Link, existence of a Sustainable Board Committee, auditing of environmental metrics. Main data sources were Bloomberg, CDP (via Bloomberg) and RepRisk.