Thirteen Canadian companies have made the list of the 100 most sustainable corporations in the world, including several energy firms that often draw criticism from environmentalists.
The annual Global 100 list, compiled by media and research company Corporate Knights, is being released Wednesday at the World Economic Forum in Davos, Switzerland. It ranks major public corporations using a wide range of factors, including relative energy and water consumption, carbon emissions, waste production and several corporate governance measures, such as the number of women on the board and CEO compensation relative to average employees.
The top Canadian company is Tim Hortons Inc., which came in 22nd place. Bombardier Inc. is the next highest, at number 24.
Several of the top Canadian companies are in the resource sector, such as Teck Resources Ltd. (at number 41), Enbridge Inc. (75) and Encana Corp. (76), along with two firms that are active in the oil sands, Cenovus Energy Inc. (at 52), and Suncor Energy Inc. (53).
Corporate Knights chief executive officer Toby Heaps acknowledged that the inclusion of these companies in the top 100 is "eyebrow raising," but he said the rankings compare firms with their peers in the same industry. Essentially, the rankings measure "who is doing the overall best job on resource productivity, and abiding their end of the social contract."
The leading Canadian energy companies do well on many of the performance measures, even if they have room for improvement on some of the environmental indicators, he said.
Indeed environmental measures make up only about one-third of the sustainability criteria. On many others – such as safety performance, leadership diversity, employee turnover and innovation – some energy companies do very well.
The top-ranked company in the world is Westpac Banking Corp., a huge Australian financial services firm. Biogen Idec Inc., a U.S. biotech firm, came second, and Finland-based Outotec Oyj, which makes mineral processing machinery, was third.
The United States has the most companies on the list, at 18, while Canada came second with 13. Britain and France each have eight companies on the list.
Doug Morrow, Corporate Knights' managing director, said the criteria used in the rankings go well beyond what are usually considered sustainability measures. "Companies that are the most sustainable are the ones that are squeezing the most output out of every unit of input they bring in," he said.
But it is also widely acknowledged that corporations with more diverse boards, good safety standards, and lower employee turnover, tend to outperform the broader market, he said. Even the ratio of CEO pay to that of the average worker – one of the Global 100 measures – has been shown to affect employee morale, and thus impact profitability, he said.
An investment index based on the Global 100 group has outperformed the Dow Jones Sustainability Index and the MSCI All Country World Index over the past decade.
Top 10 firms on the list:
1. Westpac Banking (Australia), banking
2. Biogen Idec (U.S.), biotech
3. Outotec (Finland), industrial
4. Statoil (Norway), energy
5. Dassault Systèmes (France), software
6. Neste Oil (Finland), energy
7. Novo Nordisk (Denmark), health care
8. Adidas (Germany), clothing
9. Umicore (Belgium), materials
10. Schneider Electric (France), energy
Canadian firms on the list
22. Tim Hortons
41. Teck Resources
49. Bank of Montreal
52. Cenovus Energy
53. Suncor Energy
67. Intact Financial
79. Sun Life Financial
90. Toronto-Dominion Bank
Source: Corporate Knights