AccountAbility, which provides Fortune Magazine with the list of top 100 companies with respect to sustainability, has recently come out with its 2007 assessment. While the list is dominated by oil and energy companies – the companies that clearly have the greatest need to position themselves well – it also includes a number of important retailers suggesting that they too are feeling the pressure. In the order in which they appear: Tesco, Carrefour, Metro, Home Depot, Target, Walmart, Kroger and Cost-co. The pressure to meet their standards will continue and even grow for Brand owners and suppliers. Interestingly, only two FMCGs are represented: Nestle (#25) and P&G (#31).
What is this assessment about? Fortune ranks the 100 largest global corporations by their commitment to social and environmental goals. The rankings are based on a set of 100 measures in four categories: three process categories – strategy, governance, and stakeholder involvement, and a fourth category that measures how well a company actually performs.
The strategy component evaluates how well the company incorporates social and environmental goals in its business decisions.
The governance component identifies the processes that hold executives and board members accountable for achieving non-financial goals. For example, BP is ranked No. 1 even though it had two bad accidents (a refinery explosion and an oil spill in Alaska) because even though it had record profits, it replaced the top executives at its refining and marketing subsidiary.
The third component assesses how well a company responds to its stakeholders: employees, communities where it operates, activist groups, and other stakeholders. These groups are affected by decisions, but rarely have a part in influencing decisions. Companies that incorporate stakeholders and stakeholder feedback therefore rank more highly.
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