Which companies have the best track record with environmental, social, and governance (ESG) performance? This is an increasingly important question. The rise of stakeholder capitalism – in which investors evaluate businesses for how well they balance profits with their investment in people and society – has exerted tremendous pressure for businesses to become better corporate citizens, which is where a a commitment to ESG comes into play. In addition, there is a growing recognition that businesses with a strong commitment to ESG among their employee base perform better. With all that as a backdrop, research and investment firm JUST Capital has released a new ranking of the 100 top-performing ESG firms. And the results say a lot about the state of ESG today.
JUST Capital is a research and investment firm that publishes rankings, investable indexes, and in-depth financial analysis to support the business and investor case for just business behavior. The company was founded in 2013 with a single goal: to drive investment capital toward more just companies, thereby incentivizing a more just and equitable marketplace.
The JUST 100 is a comprehensive ranking of companies on ESG issues critical to stakeholders, from their workers and shareholders to customers, communities and the environment. The Top 100 are the 100 top-performing companies across all industries for 2022. The companies are evaluated across a range of metrics in these categories:
One may quibble with the evaluation criteria – for example, many might argue that the environment deserves a stronger weighting. But on the other hand, placing a strong weight on how a business treats its employees is arguably more important than ever. Employees who thrive in an inclusive environment may very well make the company more effective across all categories because the company’s values align with theirs.
It’s also worth noting that JUST weights the categories based on an ongoing survey that asks Americans about what they believe U.S. companies should prioritize most when it comes to just business behavior. So, consider the weighting to reflect the overall priorities of the American population. This may explain the importance of treating employees well, given the heightened attention placed to employee well-being since 2020.
As CEO Myron Knapp wrote about the JUST rankings, “Let this sink in: The top ESG issue for Americans is NOT climate, but workers. Specifically, how workers are treated . . . The people, employees, the local communities and then extended communities should be the contextual lens through which companies craft and focus ESG policies and compliance.”
JUST Capital identifies the following in its Top 10:
It’s also worth noting that Intel ranks Number One for its diversity and inclusion practices among its employees.
Microsoft is also the second highest ranked firm for its commitment to the environment. (VMWare, ranked Top 55 overall, ranked Number One here.)
Finally, the JUST 100 may prove to be a benchmark to understand which companies will prevail amid “The Great Resignation” that has intensified the importance of employee recruitment and retention. According to a CNBC analysis of the rankings, “The reasons for companies to lean into ESG aren’t limited to external communities. ‘In a lot of cases, it is for their own employees,’ Elizabeth Levy, portfolio manager and head of ESG strategy at ESG investment firm Trillium Asset Management, said, noting that the current labor market is not one in which companies which are slow to place emphasis on ESG issues will win the war for talent.”
Our report The ESG Agenda will help your business get started telling a more effective story about your ESG commitment. The report contains tips for how businesses can discuss ESG in ways that build trust with all their audiences. As noted, we also rank – for the first time – the Top 10 businesses around the world that articulate their commitment to ESG via digital. Read this report to understand what a successful ESG story looks like -- and how to get started telling yours more effectively.
Learn more about our ESG & Sustainability services, here or contact IDX to amplify your ESG story in a more powerful way.