Reynard Loki is a Justmeans staff writer for Sustainable Finance and Corporate Social Responsibility. A co-founder of MomenTech, a New York-based experimental production studio, he writes the blog 13.7 Billion Years and is a contributing author to "Biomes and Ecosystems," a comprehensive reference encyclopedia of the Earth's key biological and geographic classifications, published in 201...
Visualize This: Justmeans Insights Uses Data Visualization to Empower Stakeholders and Inspire Transparency
Contextualization, competitive intelligence and the rise of data visualization are changing the way we understand the environmental, social and governance impact of the private sector
Newsweek recently released their third annual Green Rankings, in which they rank the 500 biggest companies in America and 500 of the biggest companies in the world. According to Newsweek, "The data -- crunched in cooperation with Trucost and Sustainalytics, two leading environmental-research firms -- assess companies' environmental footprint (including greenhouse-gas emissions and water use); management (including environmental policies, programs, and initiatives); and disclosure (including company reporting and involvement in transparency initiatives). Underlying data are drawn from a variety of sources, including the companies themselves, and vetted for reliability."
So the underlying data is reliable, but how useful is the actual ranking? Among US companies, according to the Green Rankings, IBM is #1, Office Depot is #8, Ford Motors is #22 and American Express is #25. But what do those numbers really mean, especially considering that these firms represent vastly different industries?
Justmeans Lead Analyst Benjamin Whitney has a background in data visualization, specifically in the role that information plays within a sociocultural context. He also has experience designing knowledge management systems. In the following first part of a two-part interview, I asked Benjamin some questions about the concept of global rankings and the project he's been working on: Justmeans Insights, a new and innovative data visualization tool that allows users to compare a company's ESG (environmental, social and governance) performance to that of their peers in the same sector. The companies included have a market capitalization of at least USD $1 billion. (Full disclosure: I am a staff writer for Justmeans).
Being a data viz junkie myself, and obviously interested in the environmental impact of the private sector, I was very curious to see how this tool compared to ranking systems like Newsweek's and the Dow Jones Sustainability Index (DJSI). I talked to Benjamin and he gave me a walk-through of the program. My first impression is that Justmeans Insights is a pretty powerful tool for investors, consumers, journalists, academics, CEOs, CSR professionals -- basically anyone who wants to know what the world's biggest companies are doing in terms of ESG. It's also really easy to use. I was able to make very clear and usable graphs in just a few seconds.
Reynard Loki: What's the inspiration behind Justmeans Insights?
Benjamin Whitney: We wanted to move away from a ranking or a rating. That's there because it gets companies interested in supplying data. But there are already a lot of rankings out there, and in talking to analysts, stakeholders, CSR/ESG professionals and companies themselves, we found that global rankings don't have a lot of materiality. You end up comparing apples to oranges, or more like apples to aeroplanes -- companies that have no real relation to each other like an IT company to a mining and materials company. The scope of their operations and the impact of their operations are so different that comparing one as environmentally better than the other makes little sense.
RL: And that's where data visualization comes in?
BW: Right. We decided to focus strictly on revealing publicly available data on companies visually, and we built a tool that's customizable and usable to all interested parties to get what really matters with these rankings, and that's the data that was used to derive the rankings in the first place. And to keep that consistent and meaningful, we're looking at only industry peer groups.
RL: So Insights grew out of the Justmeans Global 1000 Ranking?
BW: Yes, and the new product is more valuable to stakeholders because it puts the data into a context that's more meaningful by looking at and comparing specific sectors.
RL: And this kind of contextualization is unique?
BW: Absolutely. What you usually get with a global ranking is a list of companies and then a third-party analysis of why one company is better than the other. Insights, on the other hand, looks at the companies' data and gives users the ability to compare the data of one company with its peers and also the ability to contextualize that data; i.e., what does it mean for a company to have an increase from one year to another in say, waste recycling, or why do they have this particular policy in human rights? In this way, the data becomes more about a real competitive intelligence between companies and also a means for communication of what is actually happening at a particular company's operations.
RL: I like these ideas of contextualization and competitive intelligence. It seems that you are trying to peel away a layer of methodology that traditional ranking systems have in order to get closer to the data -- and let the user see the data how they want to see it.
BW: Yes, exactly. For example, one of the traditional processes of ranking indices is to send companies a survey, companies send it back to the ranker, the ranker runs some internal process to rank the companies, and then they publish a list. The data itself is still hidden behind the methodology of that particular ranking system, so you're not quite sure where it all comes from.
RL: So in that scenario, it seems like end-users just have a ranking, and are removed from the actual data.
BW: What you have to go on in terms of a company's positional ranking is whatever third-party analysis that particular ranker did. We wanted to move away from that and present data to give the decision-making back to stakeholders and CSR professionals so that they could make their own choices.
RL: Having a background in data visualization, how do you see this practice playing out in CSR and sustainable finance in particular?
BW: I am especially keen on it in this arena because if you're going to reconcile financial and market sustainability to environmental and social sustainability, you actually need a data-driven process. But that's got to be presentable in a way that's digestible to as many people as possible. And data visualization offers the only means of doing that.
In the second part of my interview with Benjamin Whitney, "Visualize That: The Impact of Source Documentation and Data Visualization on CSR Analysis," we dive deeper into the true power of data visualization and see how Justmeans Insights is changing the way we interpret ESG data and sustainability rankings. Also featured are some of the images that I created using the program.