Burgess COMMENTARY
My initial take on the Fortune listing, and the Sustainable Brands commentary on the listing is very negative. I certainly would not identify these 'Most Admired' companies with being sustainability stars ... and I think that Sustainable Brands is doing a serious disservice to its own 'brand' by so doing.

The good news is that each of these companies is doing something with respect to sustainability that they were not doing a decade ago ... and yes, that is progress, but relative to what is needed, it rounds to nothing.

A bigger flaw in the Fortune exercise is the lack of any real metric that embraces all aspects of the triple bottom line ... profit, people and planet. The impact of these companies on the totality of the global enviro-socio-economic system is not being measured in a meaningful way and this makes the whole process suspect.

For example, Coca-Cola has been a great investment for the past 30 or 40 years while the damage being done to our global society by sugar drenched sodas is routinely ignored by the system of metrics being used. The idea that it is easier to get a Coca-Cola drink in some of the most impoverished parts of the world than to get clean potable water is obscene ... not to mention the inefficient way in which companies like Coca-Cola use scarce water, create massive amounts of plastic waste, and so on.

While a company like Apple gets to be top of this listing because it has extracted a huge amount of cash from its customers, and pays workers relatively little (and hardly anything at all in the US where its (production) workers are essentially extinct ... but gets kudos because its few US facilities are going to be powered by renewable energy. Apple products run on top of an infrastructure that is a huge consumer of electricity, a large part of which comes from high polluting coal powered generation. And while modern mobile technology is amazing, only a tiny amount of this amazing power is getting used for activities that are going to make the world a significantly better place. Better, yes, but significantly better, no.

I can go on ... bottom line is that these companies deserve a mention, but the idea that they are sustainability stars is a stretch.
Peter Burgess

World’s ‘Most Admired’ Companies Also Are Sustainability Stars

Image Credit: Wikimedia

Apple, Google and Berkshire Hathaway are the world’s most highly regarded companies, according to a new ranking by Fortune magazine.

Amazon, Starbucks, Disney, Southwest Airlines, American Express, General Electric (GE) and Coca-Cola rounded out the top ten.

The World's Most Admired Companies 2015 list rates companies on nine attributes: innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment, quality of products/services and global competitiveness. To determine the rankings, thousands of senior executives, outside directors and industry analysts are independently surveyed.

At first glance, it’s tough to see how big of a role sustainability practices played, if at all, in influencing the rankings. Of the “Nine Key Attributes of Reputation,” the closest direct indicator for sustainability seems to be the rather ambiguous “social responsibility” attribute. However, if we can assume this to be a sign of sustainability, it does seem to influence company reputation. Seven of the top ten companies — Apple, Google, Starbucks, Disney, American Express, GE and Coke — all were ranked No. 1 for social responsibility. Berkshire Hathaway and Amazon, however, were ranked No. 9 and No. 8 for this attribute, respectively.

The ‘Most Admired’ Companies’ Sustainability Stories

The majority of the ranking’s top performers have a history of forward-thinking behavior. Apple, for example, was ranked the “greenest gadget company” by a report released late last year by Greenpeace. The company also has committed to powering its new headquarters, stores, offices and data centers with renewable energy to reduce the pollution caused by its devices and online services. In addition, Apple began offering free recycling of all of its used products.

Google is no sustainability scrub, either. The search giant has been flexing its market muscle as part of the Building Health Initiative to create demand for new and innovative products that improve the health of the built environment. The company also was ranked No. 1 in a separate CSR reputation ranking released late last year by the Reputation Institute.

Starbucks also has been active in advancing corporate sustainability, both environmental and social. Starbucks was one of more than 200 companies to sign on to support the US Environmental Protection Agency’s Clean Power Plan. In a strong act of social sustainability, the coffee company last year partnered with Arizona State University to offer employees free college tuition.

Disney may own the 'Happiest Place on Earth,' but it also is one of the first companies to put a voluntary internal price on carbon. Internal carbon pricing has become a key strategic element and a standard operating practice for many businesses. They recognize that the effects of climate change, including devastating extreme weather events, have an impact on their bottom line and should be included in any risk assessment and long-term business planning.

The sustainability efforts of American Express are less well-known, but the company has established voluntary 'climate contracts' to reduce its carbon footprints within a specified period of time.

GE, however, has been an active player on the sustainability field. The company last year renewed its ecomagination commitment, a sustainability initiative that seeks to find technology solutions that save money and reduce environmental impact for its customers and operations. Since its 2005 launch, GE claims ecomagination has generated more than $160 billion in revenue. The company’s own operations have seen a 34 percent reduction in greenhouse gas (GHG) emissions since 2004 and a 47 percent reduction in freshwater use since 2006, realizing $300 million in savings.

More recently, GE launched UsedtoUseful, a platform that explores the impact of water reuse on industrial and municipal sectors. The site shares industry insight and discusses interesting concepts surrounding the impact of water reuse on industrial and municipal sectors.

Coca-Cola also is no stranger to sustainability — the beverage company has improved water efficiency by 21.4 percent since 2004 and has supported an estimated replenishment of about 52 percent of the water used in finished beverage products through 2012. In addition, the company was among the first to receive the Carbon Trust Water Standard for achieving its lowest-ever water-use ratio and reducing water usage by nearly 15 percent since 2007.

Good for People, Planet and Profit

Interestingly, most of Fortune’s ‘Key Attributes’ have everything and nothing to do with sustainability. Innovation, people management, use of corporate assets, quality of management, long-term investment, quality of products/services are all qualities found in good corporate sustainability citizens — which all contribute to financial soundness and global competitiveness. This suggests that the most successful and admired companies in the world are also the ones employing strong sustainability strategies.

Mike Hower is a senior writer at Sustainable Brands. Currently based in Washington, D.C, he is a new media journalist and strategic communication professional focused on helping to drive the conversation at the intersection of sustainable business and public policy.… [Read more about Mike Hower]