The Greenest Company of Them All

Mirror, mirror on the wall, who is the greenest company of all?

On Monday, Newsweek Magazine dropped a bombshell when it released the first annual Green Rankings of S&P 500 companies. They separately ranked and weighted environmental performance, achievements, and reputation of each company and then boiled it down to one understandable green ranking number out of 500. The best ranking is 1 and the worst is 500.

The green blogosphere has been a twitter all week.  

Imperfect, perhaps, as the ranking process was, it does shed some daylight on where companies are with their green practices.  I will bet you a crate of organic apples that this ranking will cause a stir in the corporate sustainability world.  It will rankle some and tickle others.

How did our home team do?

Travelers Insurance and 3M were two Minnesota companies in the top 50 – yea!  Best Buy, Medtronic, Target, and General Mills (in that order) made it into the top 100 – all expected.  The middle of the pack greenies were Supervalu, EcoLab and CenterPoint Energy – all with a score near 200 – better than average.   The most notable Minnesota laggard was Xcel Energy with a rank of 436 out of 500.  Not a surprise; the energy companies were mostly bottom dwellers with loads of environmental impacts and some reputation issues.  

The rankings were based on information from various sources put together by a panel of sustainability experts:

• Environmental Impact Score based on more than 700 metrics, compiled by Trucost, a leading provider of data and analysis on company emissions and natural resource use

• Green Policies Score an analysis of corporate policies and initiatives by KLD Research&Analytics, one of the pioneers in socially responsible investing research

•  Reputation Survey Score resulting from a survey of CEOs, corporate environmental officers, and academics conducted by CorporateRegister.com, an online directory of company-issued CSR, sustainability, and environment reports from around the world

So what?  

Here’s what. Mark my green words; this ranking will make a difference.  Companies are competitive; they will want to improve their score and beat their competitors.  This will help drive sustainability and eco-innovation not just in some industries but also across the entire economy.  At some point, it will trickle down to all the suppliers and across entire supply chains.   This is powerful stuff!

Some green consumers will care too.   This ranking system tells me who is the greener retailer:  Target with a score of 72 vs Costco with a score of 200.  In the past, I might have made a decision about where to shop based on where I could find more green products. Now I have a new metric and an even better reason to give Target my greenbacks.

The good news for the planet is that this list will move our economy in a greener direction. You can bet that sustainability managers all over the country are now getting heavy pressure from the exec suite to improve their company’s score by next year.  

The corporate green games are on!