Target, Starbucks, General Mills and Ford all feature in rankings of the most ethical companies in 38 sectors.
The 2011 World’s Most Ethical Companies rankings by Ethisphere magazine honor companies deemed to have demonstrated a commitment to ethical business practices. Honorees must demonstrate real and sustained ethical leadership within their industries and translate ethical words into action, Ethisphere says.
The rankings do not choose a set number of companies, but rewards companies that lead their industry peers. This year Ethisphere chose between one and six firms in each sector, for a total of 110 companies. In 2011, 36 companies are new to the list.
But 26 have dropped off from the 2010 list, generally because of litigation and ethics violation, as well as increased competition within their industries, Ethisphere said.
Ethisphere found that ethical behavor is a good indicator of financial performance. The percent returns of its World’s Most Ethical Companies honorees have consistently outperformed the S&P 500 every year since the rankings began in 2007 (see chart).
The selection process takes into account how well companies’ ethics and compliance programs are aligned with corporate best practice, case law and guidance set out in the Federal Sentencing Guidelines. The evaluation also considers companies’ legal compliance and litigation track record, reputation in the marketplace, concrete examples of local, national, industry or global initiatives, governance and corporate citizenship, including environmental stewardship, supply chain engagement and corporate philanthropy.
The Ethisphere institute also awards Ethics Inside certifications to companies that go beyond legal requirements to cultivate and maintain an exemplary culture of compliance and ethics. Hitachi won certification last month.
Ethisphere's rankings have some overlap with the EthicalQuote rankings by Swiss company Covalence, with PepsiCo making both lists. But IBM and Intel, which appeared first and second on the Covalence list, did not make Ethisphere's rankings.
A selection of Ethisphere's chosen companies this year:
Aerospace
Indra Sistemas
Rockwell Collins Inc.
The Aerospace Corporation
Apparel
Adidas
Comme Il Faut
Gap
Patagonia
Timberland
Automotive
Cummins
Denso
Ford Motor Company
Johnson Controls
Computer Hardware
Hitachi Data Systems
Computer Software
Adobe Systems
Microsoft
Salesforce.com
Symantec Corporation
Teradata Corporation
Consumer Electronics
Electrolux
Ricoh
Xerox
Consumer Products
Colgate-Palmolive Company
Henkel AG
Kao Corporation
Diversified Industries
General Electric Co.
Energy and Utilities
Encana
Statoil
NextEra Energy, Inc.
Northumbrian Water
Vestas Wind
Wisconsin Energy Corporation
Environmental Services
Waste Management
Financial Services
American Express
Housing Development Finance Corp
NYSE Euronext
The Hartford Financial Services Group
Food and Beverage
General Mills
PepsiCo
Solae
Stonyfield Farm
Food Stores
Kesko
The Co-Operative Group
Wegmans
Whole Food Market
Hotels, Travel and Hospitality
Kimpton Hotels
Marriott International
The Rezidor Hotel Group
Wyndham Worldwide
Internet
Zappos
Media, Publishing and Entertainment
Thomson Reuters
Real Estate
British Land plc
Jones Lang LaSalle
Unibail-Rodamco
Restaurants and Cafes
Starbucks Coffee Company
Specialty Retail
Best Buy Co.
Hennes & Mauritz
Sonae
Target
Ten Thousand Villages
Telecom Hardware
Avaya Inc.
Cisco Systems
Juniper Networks
Telecom Services
Singapore Telecom
Swisscom
T-Mobile USA
Transportation and Logistics
Autoridad del Canal de Panama
East Japan Railway Company
Nippon Yusen Kabushi Kaisha
UPS
