Nine Australian companies made the 2010 Global 100 list of the most sustainable companies: Westpac, IAG, Stockland, GPT, Bluescope, Origin, Boral, Sims and Dexus, pushing Australia into a tie for third place on the world rankings. Corporate Knights, the Canadian magazine, announced the sixth annual Global 100 list at the Davis World Economic Forum last week. The top rank overall went to General Electric, owner of the ecomagination line. 

 

GE’s score was bolstered by its industry leading ratio of sales to waste ($729,685 in sales per tonne of waste produced), strong board gender diversity (almost a quarter of directors were female), and an impressive doubling of its carbon productivity (sales/tonnes of total CO2 equivalent) from 2006 to 2008, cutting total carbon emissions from 10.8 million tonnes to 6.5 million tonnes, while increasing sales from US$150 billion to US$181 billion.

 

The 2010 Global 100 is based on data from the sustainability research alliance put together by Legg Mason, which identifies the top 10 per cent of companies from a universe of 3000 global stocks. These are then transparently ranked based on ten indicators, with data sourced from ASSET4, a Thomson Reuters business, and Bloomberg

Among the 24 countries surveyed, the UK led the way with 21 Global 100 companies and the US followed with 12.

In addition to social indicators such as CEO-to-average worker pay and diversity of board directors, the 2010 Global 100 established and measured companies against an objective ‘sustainable path’ standard for energy, carbon, water, and waste ratios. This was set at achieving annualised resource productivity gains in excess of the 6 per cent, a threshold informed by research by Lord Nicholas Stern, the McKinsey Global Institute, and Factor Four literature. By this measure, 71 per cent of the 2010 Global 100 are on a path towards sustainable resource use.

Toby Heaps, editor-in-chief of Corporate Knights Magazine, said: “By using clear metrics to show investors which companies stand out from their peers, we hope to create a virtuous cycle where the most sustainable companies attract the most capital and earn the best returns.”

Matthew Kiernan, CEO of Inflection Point Capital Management, a new sustainability-focused asset management venture, whose 5-factor model underpins the list, said: “Given the range and quality of inputs in creating the Global 100, we would expect it to become over time the ‘international gold standard’ for sustainability indexes. We anticipate that demand from leading institutional investors will be strong.”

 

Kiernan is former CEO of Innovest, now owned by KLD Analytics, itself now part of RiskMetrics.