Newsweek's 2010 Green Rankings came out this week to a quiet reception and not a lot of fanfare. In fact, the rankings themselves didn’t change by a lot either. Dell took the top spot this year followed by Hewlett-Packard (No. 1 last year), IBM, Johnson & Johnson, and Intel rounding out the top five.
Also unchanged is how Newsweek's final Green score comes together from three separate metrics: An Environmental Impact Score based on data compiled by Trucost; a Green Policies Score, calculated by MSCI ESG Research; and finally a Reputation Score, conducted by CorporateRegister.com who asked corporate social responsibility professionals, academics, and other environmental experts to rate the companies on three areas: environmental performance, commitment, and communications.
What is new this year, however, is an accompanying Global 100 list, which ranks the biggest publicly traded companies in developed and emerging world markets on their green quotient. This list is led by IBM followed by HP, Johnson & Johnson, Sony & GlaxoSmithKline rounding out the top five.
Joel Makower, executive editor of and a leading author on the greening of mainstream business explains it well:
"Here’s the real bottom line: There appears to be a correlation between high-scoring companies and well-performing stocks, according to Cary Krosinsky, vice president of Trucost. His analysis found that the top 100 companies in this year’s Newsweek rankings outperformed the Standard & Poor's 500 Index (on an equally weighted basis) by 6.8% for the 12-month period ending September 1, 2010. That, as they say, is real money.
Correlation isn’t causality, of course, but Krosinsky’s findings are encouraging. It’s one thing for a company to know that its sustainability measures are helping lift its stock price. But it’s altogether another thing when its shareholders know that.
In the end, making that link may be the biggest contribution the Newsweek's ranking make to the field of sustainable business."
So, while it might be worth it for competition sake for companies to use this ranking to tout their green initiatives, it won't amount to much if their commitment to sustainability doesn’t find a concrete place in their business model and decision making processes.
For the complete ranking, visit Newsweek.