CSR Rankings: Who Makes the Grade?

As I mentioned in my welcome post, Good Company will explore the historical context behind CSR goals publicized by top U.S. corporations. Since some readers have asked me how I plan to decide which companies to cover, I thought it would be helpful to share a study of CSR rankings which I used to inform--- but not limit--- the series' focus.

These days, CSR reports are a dime-a-dozen, but substantive sustainability programs are not. In fact, many of the largest publicly-traded companies in the U.S. (as defined by the Fortune 500 based on total annual sales) have bare-bones programs consisting of good, old-fashioned corporate philanthropy and some basic claims about initiatives that are more-or-less required or incentivized by existing laws and regulations. While I do not want to minimize the significance of corporate philanthropy and compliance (both are very important!), they are not the intended subject of this series.

With that in mind, I decided to look to a set of rankings that recognize "top" CSR programs. To narrow my list, I cross-referenced the Fortune 500 with the CRO's 2009 Best Corporate Citizens, the 100 top-ranked companies in the 2009 Newsweek Green Rankings, and the Ethisphere Institute's 2009 Most Ethical Companies. I was surprised to discover how little consensus exists between the three groups. For example, a mere 16 Fortune 500 companies appeared on all three lists and only 31 were selected for both Best Corporate Citizens and the Newsweek Green Rankings top 100. An additional 17 members of the Most Ethical Companies list also made either the Best Corporate Citizens OR the Newsweek Green Rankings top 100. Those curious about the substance of the overlap can refer to the chart at the bottom of this page.

While differences in scope may explain some of the variations between the rankings (Newsweek is focused on the environment, Ethisphere Institute includes non-U.S. companies, and all three include a handful of companies outside the Fortune 500), do the math and you will realize that there is remarkably little consensus about what constitutes a good company. Only 64 Fortune 500 companies qualified for even two lists! It is surprising too how many companies included are not frequent topics of discussion around the CSR water cooler.

I want to pose those reading this post a few questions. What do you think of the CSR rankings I used for this study and are there others that you wish I had taken into account as well? What is your take on why there is so little consensus about what constitutes a notable CSR program? Finally, are there companies on this list that you would like to see me focus on first?

Disclosure: The author of this post is a contractor for RiskMetrics Group, which acquired the sustainability analytics firm KLD in November. KLD was one of the contributors to the Newsweek Green Ranking cited in this post.