While the CEOs and decision-makers that attended the annual World Economic Forum meeting seemed more worried about things other than climate change (the potential for another Donald Trump presidency and artificial intelligence), they were also more excited about the gathering multitrillion-dollar economic opportunity presented by the transition to a low-carbon sustainable economy. Business is better at playing offence than defence, so I think this may be a good thing.

Corporate Knights’ annual Global 100 ranking of the world’s most sustainable corporations turned 20 this year in Davos. And the corporations that make up the Global 100 are proving that companies that set the standard for sustainability excellence can also outperform the market over time. Now is the time to double down.

These companies show that the climate crisis is far from the back burner for many major players in the business world. Maybe it seems like it has been placed on the back burner simply because it’s becoming ingrained in the way we do business. There isn’t only a moral imperative for corporations to work toward a more sustainable planet; there’s a financial one, too. Here are eight ways the sustainable economy is taking over.

1. In 2024, the average Global 100 company earned 51% of its revenue from sustainable solutions in alignment with the Corporate Knights Sustainable Economy Taxonomy (which measures corporate contributions to the sustainability transition). That’s three times better than the average large publicly traded company with more than US$1 billion in overall revenue, which earned 16% of its revenue from sustainable sources.

2. When it comes to sustainable investments, it’s the same story. Global 100 companies allocated 55% of their total investments (capital expenditure, research and development, and acquisitions) to sustainable themes, versus 17% for the broader universe of companies analyzed.

3. Financially speaking, the Global 100 index has stood the test of time, outperforming its benchmark over the past two decades. It has posted a 295% total return since its inception in February 2005 to the end of 2023 (versus 278% for the MSCI ACWI).

4. The really good news is that the exponential growth of the sustainable economy is not contained to the Global 100 companies; it is now embedded as a dominant macroeconomic growth trend, with large publicly traded companies growing their sustainable revenues and investments at double the rate of general revenues and investments over the past three years. A look inside the Corporate Knights Sustainable Economy Intelligence Database shows that sustainable capital expenditures grew by 56% from 2019 to 2022, compared to 23% for general capital expenditures, while sustainable revenue grew by 84% versus 40% for general revenues over the same period.

5. None of this means we can rest on our laurels. The fossil fuel industry is flush with cash, existentially motivated and ferociously well organized to put up political barriers that delay the inevitable transition to a low-carbon sustainable economy. But fear not: the companies that want swifter climate action in alignment with the Paris Agreement – publicly traded companies signed up to the Science Based Targets initiative (SBTi) – have seven times more economic power (earning US$28 trillion in the most recent fiscal year, according to Corporate Knights calculations) than the US$4 trillion haul made by the fossil fuel industry (itself a huge rise from its recent average of US$1.5 trillion).

6. This economic power must be translated into political power to address barriers to climate action, chief among them unacceptably long permitting times for renewable-energy projects. This is beginning to happen with work led by the Corporate Knights Global 100 Council and others to galvanize the voice of business – not just the green energy companies – as a voice for speeding up climate action. This was demonstrated at COP28 (the first COP agreement to include a renewable-energy target), where business calls spanning all sectors for more clean energy were met with a pledge to triple installed renewable energy to 11,000 gigawatts by 2030.

7. While the fossil fuel industry is more powerful politically, both science and economic power are on the side of companies that want to speed up climate action.

8. While much climate action discussion is devoted to absolute net-zero goals decades away, which can raise hackles and unnecessary existential questions, the current imperative is to focus on speeding up action here and now.

Corporate Knights is here to help organize and provide secretariat support for companies that want to speak out together and ensure that their industry associations are part of the program, so we can make 2024 the year of climate action acceleration.

Our skis are pointed in the right direction, and we’re closing in on the summit (with an electric assist).

Toby Heaps is co-founder and publisher of Corporate Knights. 

The post Eight ways the sustainable economy is (still) taking over appeared first on Corporate Knights.

As 2023 came to a close, the World Meteorological Organization declared it to be the hottest year on record. One week later, the Global Carbon Project shared more discouraging news: that despite global pledges to reduce emissions, greenhouse gases from fossil fuels hit a record high again in 2023. 

As the climate crisis exacts a punishing toll around the globe, we’re also getting better at solving problems. Corporate leaders are flowing a growing share of their revenues into investments that will accelerate the green transition, according to Corporate Knights research.

Now in its 20th year, Corporate Knights’ Global 100 ranking of the world’s most sustainable companies reveals the top firms that are increasing their investments in green solutions such as renewable energy, energy efficiency and the circular economy.

“When we launched the Global 100 in 2005, the green economy was a quaint idea. Many companies didn’t publish in-house sustainability reports. There were no standardized key performance indicators, and none of the companies were reporting the percentage of their revenue or investments that were green,” says Corporate Knights co-founder and CEO Toby Heaps. “We did the best job possible with limited qualitative corporate disclosure.”

“Now we can measure this green business exposure for the majority of companies and are able to count annual green investments that run into the trillions, growing six times faster than the economy at large,” Heaps says.

While many companies, particularly in the fossil fuel and banking sectors, resist any major departure from their lucrative business-as-usual path, the leaders are doubling down on sustainability. 

In the 2024 Global 100 ranking, the top-ranked firms allocated 55% of their investments to sustainable projects, up from 47% the year prior. That compares with sustainable investments at a paltry 17% among the broader universe of publicly traded companies with more than US$1 billion in annual revenue.

When we launched this ranking in 2005, the green economy was a quaint idea.

–Toby Heaps, co-founder and CEO, Corporate Knights

The increase in sustainable investment is a welcome sign that companies are changing course. “The fact that these companies are plowing more money into sustainable capital expenditure and R&D means that we expect them to have higher sustainable revenues in the near future,” says Matthew Malinsky, research manager for Corporate Knights.

• CONTINUE READING

2024 Global 100 ranking 

2024 rank	2023 rank	Company	HQ location	Peer group	Carbon productivity	% Taxes paid	CEO to average worker pay ratio	% Gender-diverse board of directors	% Sustainable revenue	% Sustainable investment	Final grade	Climate commitments
1	14	Sims Ltd	Mascot, Australia	Waste management	$ 38,525	16%	36:1	38%	100%	100%	A+
2	3	Brambles Ltd	Sydney, Australia	Furniture and general manufacturing	$ 123,791	12%	61:1	36%	100%	100%	A	1.5°C, SBTi
3	2	Vestas Wind Systems A/S	Aarhus, Denmark	Machinery manufacturing	$ 141,969	19%	70:1	42%	100%	100%	A	1.5°C, SBTi
4	9	Taiwan High Speed Rail Corp	Taipei, Taiwan	Transit and ground transportation	$ 7,698	0%	11:1	15%	100%	100%	A
5		Nordex SE	Hamburg, Germany	Machinery manufacturing	$ 160,887	73%	82:1	33%	100%	100%	A	1.5°C, SBTi
6	15	Banco do Brasil SA	Brasília, Brazil	Banks	$ 1,106,800	17%	9:1	50%	29%	0%	A-	1.5°C, SBTi
7	7*	Schneider Electric SE	Rueil-Malmaison, France	Electrical equipment manufacturing	$ 102,400	16%	97:1	50%	72%	80%	A-	1.5°C, SBTi
8	18	Chr Hansen Holding A/S	Hørsholm, Denmark	Food and beverage manufacturing	$ 38,696	14%	34:1	50%	47%	71%	A-	1.5°C, SBTi
9	7	Stantec Inc	Edmonton, Canada	Business, engineering and personal services	$ 118,360	12%	60:1	50%	59%	60%	A-	1.5°C, SBTi
10		SMA Solar Technology AG	Niestetal, Germany	Semiconductor and electronic components manufacturing	$ 135,701	22%	15:1	33%	100%	100%	A-	SBTi
11	5	Autodesk Inc	San Francisco, U.S.	IT services except telecom and hosting	$ 517,478	19%		50%	93%	0%	A-	1.5°C, SBTi
12		WSP Global Inc	Montreal, Canada	Business, engineering and personal services	$ 152,031	16%	109:1	33%	57%	92%	B+	1.5°C, SBTi
13		Clean Harbors Inc	Norwell, U.S.	Waste management	$ 3,048	8%		45%	100%	100%	B+
14		Enphase Energy Inc	Fremont, U.S.	Semiconductor and electronic components manufacturing	$ 209,362	4%		14%	100%	100%	B+
15	65	Telefonaktiebolaget LM Ericsson	Stockholm, Sweden	Telephones and telecom equipment manufacturing	$ 174,040	18%	83:1	29%	47%	71%	B+	1.5°C, SBTi
16	35	SunPower Corp	Richmond, U.S.	Semiconductor and electronic components manufacturing		0%		22%	100%	100%	B+	SBTi
17	13	Ørsted A/S	Fredericia, Denmark	Power generation	$ 8,192	10%	35:1	50%	65%	99%	B+	1.5°C, SBTi
18		Alstom SA	Saint-Ouen, France	Non-road transport equipment manufacturing	$ 111,827	11%	31:1	38%	84%	92%	B+	SBTi
19	29	Neste Oyj	Espoo, Finland	Refining, petrochemicals and basic organic chemicals	$ 15,844	10%	14:1	25%	39%	92%	B+
20	10	Dassault Systèmes SE	Vélizy-Villacoublay, France	IT services except telecom and hosting	$ 318,772	14%	27:1	50%	66%	6%	B+	1.5°C, SBTi
21	51	Giant Manufacturing Co Ltd	Taichung, Taiwan	Non-road transport equipment manufacturing	$ 56,418	18%	227:1	9%	100%	100%	B+
22	28	City Developments Ltd	Singapore, Singapore	Real estate	$ 25,789	17%	38:1	20%	54%	64%	B+	1.5°C, SBTi
23		Trane Technologies PLC	Swords, Ireland	HVAC equipment manufacturing	$ 44,213	25%	126:1	45%	38%	29%	B+	1.5°C, SBTi
24		United Utilities Group PLC	Warrington, U.K.	Water and sewage treatment	$ 10,544	3%	71:1	40%	42%	100%	B+	1.5°C, SBTi
25		XPeng Inc	Guangzhou, China	Cars and trucks manufacturing, including parts	$ 264,119	0%		14%	100%	100%	B
26		Wheaton Precious Metals Corp	Vancouver, Canada	Asset management	$ 33,251,733	0%	5:1	30%	21%	0%	B	SBTi
27	4	Brookfield Renewable Partners LP	Hamilton, Bermuda	Power generation	$ 25,165	4%	58:1	33%	97%	100%	B
28	54	ERG SpA	Genoa, Italy	Power generation	$ 2,342	9%	22:1	42%	52%	100%	B	1.5°C, SBTi
29	74	Kesko Oyj	Helsinki, Finland	Grocery stores	$ 124,317	9%	110:1	29%	3%	10%	B	1.5°C, SBTi
30		Risen Energy Co Ltd	Ningbo, China	Semiconductor and electronic components manufacturing	$ 14,582	23%	21:1	0%	100%	100%	B
31	58	Severn Trent PLC	Coventry, U.K.	Water and sewage treatment	$ 5,751	2%	64:1	56%	50%	100%	B	1.5°C, SBTi
32		Hydro One Ltd	Toronto, Canada	Power transmission and distribution	$ 19,867	1%	9:1	40%	36%	98%	B
33		Zhuzhou CRRC Times Electric Co Ltd	Zhuzhou, China	Electrical equipment manufacturing		28%		9%	100%	100%	B
34	46	First Solar Inc	Tempe, U.S.	Semiconductor and electronic components manufacturing	$ 4,270	15%		25%	100%	100%	B	1.5°C, SBTi
35	53	Eisai Co Ltd	Tokyo, Japan	Pharmaceutical and biotech manufacturing	$ 188,590	16%	10:1	18%	49%	22%	B	1.5°C, SBTi
36	1	Radius Recycling	Portland, U.S.	Waste management	$ 19,067	5%	103:1	50%	95%	100%	B
37	87	Beazley PLC	London, U.K.	Insurance companies	$ 2,864,982	10%	11:1	45%	15%	0%	B	NZIA
38	20	Cascades Inc	Kingsey Falls, Canada	Packaging	$ 4,763	3%	66:1	38%	88%	86%	B	SBTi
39		EDP Renováveis SA	Madrid, Spain	Power generation		2%	7:1	33%	100%	100%	B	SBTi
40	32	Beijing Enterprises Water Group Ltd	Hong Kong, China	Water and sewage treatment	$ 3,828	8%		20%	94%	100%	B
41	49	Atea ASA	Oslo, Norway	Computers and peripherals manufacturing	$ 483,930	12%	23:1	38%	57%	38%	B	SBTi
42	64	Yadea Group Holdings Ltd	Wuxi, China	Non-road transport equipment manufacturing	$ 49,209	8%	7:1	13%	100%	100%	B
43		Li Auto Inc	Beijing, China	Cars and trucks manufacturing, including parts	$ 107,512	3%	95:1	13%	100%	100%	B-
44	69	Maxeon Solar Technologies Ltd	Singapore, Singapore	Semiconductor and electronic components manufacturing	$ 4,422	8%		0%	100%	100%	B-
45	31	Kering SA	Paris, France	Retail, except grocery and auto	$ 261,469	28%	151:1	46%	26%	5%	B-	1.5°C, SBTi, FCCA
46	86	Tesla Inc	Austin, U.S.	Cars and trucks manufacturing, including parts	$ 133,544	6%		25%	100%	100%	B-	1.5°C, SBTi
47		Umicore SA	Brussels, Belgium	Basic inorganic chemicals and synthetics	$ 57,259	17%	32:1	40%	12%	63%	B-	SBTi
48	41	SAP SE	Walldorf, Germany	IT services except telecom and hosting	$ 168,329	28%	30:1	44%	30%	3%	B-	1.5°C, SBTi
49	22	McCormick & Company Inc	Hunt Valley, U.S.	Food and beverage manufacturing	$ 80,976	14%		36%	46%	22%	B-	1.5°C, SBTi
50	79	NIO Inc	Shanghai, China	Cars and trucks manufacturing, including parts	$ 42,750	1%		17%	100%	100%	B-
51	42	BCE Inc	Verdun, Canada	Telecom providers	$ 75,217	8%	137:1	36%	24%	78%	B-	1.5°C, SBTi
52	76	Investec Ltd	Sandton, South Africa	Banks	$ 130,634	20%	43:1	43%	14%	0%	B-	NZBA
53		Novo Nordisk A/S	Bagsvaerd, Denmark	Pharmaceutical and biotech manufacturing	$ 336,603	19%	76:1	46%	4%	0%	B-	1.5°C, SBTi
54	47	Puma SE	Erlangen, Germany	Textiles and clothing manufacturing	$ 312,773	17%	226:1	33%	54%	0%	B-	SBTi, FCCA
55	63	Samsung SDI Co Ltd	Yongin-si, South Korea	Semiconductor and electronic components manufacturing	$ 14,103	9%	135:1	29%	87%	94%	B-
56		Rivian Automotive, Inc	Irvine, U.S.	Cars and trucks manufacturing, including parts		0%	55:1	43%	100%	100%	B-
57	59	Intesa Sanpaolo SpA	Turin, Italy	Banks	$ 195,778	26%	102:1	42%	16%	0%	B-	1.5°C, SBTi, NZBA
58	23	Novozymes A/S	Bagsvaerd, Denmark	Pharmaceutical and biotech manufacturing	$ 7,348	16%	35:1	27%	67%	14%	C+	1.5°C, SBTi
59		Elisa Oyj	Helsinki, Finland	Telecom providers	$ 57,863	11%	31:1	38%	16%	63%	C+	1.5°C, SBTi
60	89	Arçelik AS	Istanbul, Turkey	Appliances and lighting fixtures manufacturing	$ 224,900	6%		17%	10%	15%	C+	1.5°C, SBTi
61		Pirelli & C SpA	Milan, Italy	Plastic and rubber product manufacturing	$ 14,318	12%	548:1	20%	23%	16%	C+	1.5°C, SBTi
62		Singapore Telecommunications Ltd	Singapore, Singapore	Telecom providers	$ 37,135	7%	28:1	43%	12%	60%	C+	1.5°C, SBTi
63	12	Xinyi Solar Holdings Ltd	Wuhu, China	Glass and ceramics	$ 891	10%	213:1	11%	100%	100%	C+
64	48	Cisco Systems Inc	San Jose, U.S.	Telephones and telecom equipment manufacturing	$ 86,080	22%	366:1	42%	42%	0%	C+	1.5°C, SBTi
65	68	KB Financial Group Inc	Seoul, South Korea	Banks	$ 142,713	25%	11:1	33%	6%	0%	C+	1.5°C, SBTi, NZBA
66	61	Sanofi SA	Paris, France	Pharmaceutical and biotech manufacturing	$ 93,914	17%	98:1	38%	27%	10%	C+	1.5°C, SBTi
67	39	HP Inc	Palo Alto, U.S.	Computers and peripherals manufacturing	$ 259,083	15%	787:1	46%	78%	0%	C+	1.5°C, SBTi
68	52	Essity AB (publ)	Stockholm, Sweden	Packaging	$ 6,803	13%	65:1	38%	33%	10%	C+	1.5°C, SBTi
69		Equinix Inc	Redwood City, U.S.	Data processing, hosting services	$ 2,970	4%		40%	48%	1%	C+	SBTi
70		Unibail-Rodamco-Westfield SE	Paris, France	Real estate	$ 29,790	4%	26:1	50%	50%	8%	C+	1.5°C, SBTi
71	73	Apple Inc	Cupertino, U.S.	Telephones and telecom equipment manufacturing	$ 351,888	16%		33%	70%	1%	C+	1.5°C, SBTi
72	80	Ricoh Co Ltd	Tokyo, Japan	Computers and peripherals manufacturing	$ 70,161	19%	17:1	13%	51%	34%	C+	1.5°C, SBTi
73	45	Cogeco Communications Inc	Montreal, Canada	Telecom providers	$ 77,783	6%	54:1	50%	26%	28%	C+	1.5°C, SBTi
74		Solaredge Technologies Inc	Herzliya, Israel	Semiconductor and electronic components manufacturing	$ 73,903	19%		50%	94%	43%	C+
75		Telefônica Brasil SA	São Paulo, Brazil	Telecom providers	$ 250,602	2%	90:1	33%	12%	53%	C+
76	38	Unilever PLC	London, U.K.	Personal products (retail chemical)	$ 53,579	23%	98:1	38%	2%	4%	C+	1.5°C, SBTi
77	36	Xerox Holdings Corp	Norwalk, U.S.	Computers and peripherals manufacturing	$ 56,147	6%		25%	75%	11%	C	1.5°C, SBTi
78	43	Coloplast A/S	Humlebæk, Denmark	Medical equipment manufacturing	$ 71,029	19%	43:1	33%	9%	0%	C	1.5°C, SBTi
79	77	Sun Life Financial Inc	Toronto, Canada	Insurance companies	$ 549,255	15%	124:1	50%	6%	0%	C
80	34	StarHub Ltd	Singapore, Singapore	Telecom providers	$ 50,109	13%	17:1	25%	8%	57%	C	1.5°C, SBTi
81	67	Hewlett Packard Enterprise Co	Spring, U.S.	Computers and peripherals manufacturing	$ 93,302	7%		46%	33%	39%	C	1.5°C, SBTi
82	72	Svenska Handelsbanken AB	Stockholm, Sweden	Banks	$ 1,052,698	26%	17:1	57%	7%	0%	C	1.5°C, SBTi, NZBA
83	94	Nordea Bank Abp	Helsinki, Finland	Banks	$ 3,242,058	10%	35:1	50%	4%	0%	C	NZAM, NZAO, NZBA
84	70	Orkla ASA	Oslo, Norway	Food and beverage manufacturing	$ 33,788	17%	17:1	45%	23%	3%	C	1.5°C, SBTi
85	37	Telus Corp	Vancouver, Canada	Telecom providers	$ 64,565	8%	338:1	43%	26%	23%	C	1.5°C, SBTi
86	81	Henkel AG & Co KgaA	Düsseldorf, Germany	Personal products (retail chemical)	$ 58,936	19%	132:1	44%	21%	1%	C	1.5°C, SBTi, NZAM
87		Prologis Inc	San Francisco, U.S.	Real estate and leasing	$ 1,614,690	3%	170:1	27%	2%	4%	C	1.5°C, SBTi
88		UniCredit SpA	Milan, Italy	Banks	$ 225,131	10%	60:1	42%	10%	0%	C	NZBA
89	85	Commerzbank AG	Frankfurt am Main, Germany	Banks	$ 423,236	16%	36:1	45%	5%	0%	C	SBTi, NZAM, NZBA
90	71	BNP Paribas SA	Paris, France	Banks	$ 320,421	13%	55:1	53%	8%	0%	C	SBTi, NZAM, NZAO, NZBA
91		Assicurazioni Generali SpA	Trieste, Italy	Insurance companies	$ 1,273,258	25%	72:1	46%	3%	0%	C	NZIA
92	78	Teck Resources Ltd	Vancouver, Canada	Metal and coal mining	$ 4,846	13%	79:1	29%	19%	28%	C
93	27	Vitasoy International Holdings Ltd	Hong Kong, China	Food and beverage manufacturing	$ 9,681	14%	70:1	18%	46%	4%	C
94		Bank of China Ltd	Beijing, China	Banks	$ 100,123	13%	4:1	15%	17%	0%	C
95	97	AstraZeneca PLC	Cambridge, U.K.	Pharmaceutical and biotech manufacturing	$ 100,380	15%	111:1	38%	13%	0%	C-	1.5°C, SBTi
96	92	IGM Financial Inc	Winnipeg, Canada	Asset management	$ 4,947,231	17%	49:1	33%	3%	0%	C-	NZAM
97		Biomérieux SA	Marcy l’Étoile, France	Medical equipment manufacturing	$ 75,374	18%	18:1	44%	6%	0%	C-	SBTi
98		Manulife Financial Corp	Toronto, Canada	Insurance companies	$ 206,669	11%	155:1	58%	6%	0%	C-	1.5°C, SBTi
99	57	Sino Land Co Ltd	Hong Kong, China	Real estate	$ 10,127	20%	50:1	8%	50%	12%	C-	1.5°C, SBTi
100		Sysmex Corp	Kobe, Japan	Instrumentation and other electronic manufacturing	$ 154,501	20%	22:1	8%	37%	0%	C-	SBTi

*Indicates a tie as a result of a data correction

Note: Banks, asset management and insurance peer groups are not assessed on the sustainable investment KPI. The weight of this KPI has been reweighted to the sustainable revenue KPI.

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The 2024 Global 100 companies earned 51% of their revenues from sustainable sources in the fiscal year 2022, up from 50% the prior year. That compares with just 16% for the broader universe of companies. 

“Sustainable investment data identifies those companies that are going to be poised to succeed in the transition to a low-carbon economy,” Malinsky says. “We can see which of these companies are going all in on sustainable investment and have watched the ratio grow for some of these companies from 20, to 30, to 50% over a three-year period.”

Two Australian companies, Sims Ltd. and Brambles Ltd., top the 2024 ranking. Sims, this year’s number one company, recycles scrap metal in 30 countries, and Brambles rents reusable pallets and containers around the globe. Both companies score 100% on sustainable revenue and sustainable investment.

> >READ OUR TOP COMPANY PROFILE

Malinsky says that the success of Sims and Brambles is emblematic of the growing number of companies associated with the circular economy, in which waste streams are recycled into new products. 

Two decades of Global 100 versus benchmark

The Global 100 also awarded a “pivot prize” to Italian energy firm ERG SpA, which completed its multiyear transition from black to green halfway through 2023. ERG had sold off its oil assets in 2013 and announced the divestiture of its gas assets in 2022 but was blocked by Italy’s anti-trust regulator. The company redoubled its efforts to sell its last non-renewable assets and finally sold its gas-fired power plant to Achernar Assets in June 2023. 

“With this operation we complete the path of transformation towards a pure wind and solar business model,” ERG CEO Paolo Merli said in a statement. 

ERG landed in 28th place on the 2024 Global 100 and will no doubt move up the rankings next year.

As its chair Edoardo Garrone said in a statement to investors, “We have shown that the transition to a sustainable business model is possible and profitable.”

 Among the Canadian firms to make the Global 100 are engineering firms Stantec of Edmonton and WSP Global, based in Montreal. First-time Canadian entries include Ontario’s transmission company Hydro One and life insurance giant Manulife Financial Corp., which joins its competitor Sun Life Financial Inc. on the list.

We have shown that the transition to a sustainable business model is profitable and possible.

 

-Edoardo Garrone, chair, ERG

The Global 100 rates companies in 38 industry groups, including banking, utilities, mining, oil and gas, and manufacturing, based on 25 metrics. It applies different weighting to certain metrics given the nature of the sector. Sustainable revenue and sustainable investment are key measures; others include gender and racial diversity, CEO pay versus employee average, CEO bonuses based on sustainability performance, taxes paid and contributions to employee pensions.

The Global 100 score far better on overall environmental, social and governance (ESG) metrics than do their peers. For example, 79% of Global 100 firms had sustainability-linked pay; only 30% of the broader corporate universe linked executive pay to the achievement of environmental or social sustainability targets.

It is a similar story for gender and racial diversity, though the difference is less stark. Some 35% of Global 100 boards of directors are gender diverse, while 25% of the broader peer group had gender-diverse boards. (Manulife was a leader with 58.3 % of its board listed as gender diverse.)

Racial diversity continues to lag both in the Global 100 group and the larger universe of companies. Only 13% of Global 100 company board directors were racially diverse compared to 10% for the larger cohort. 

All told, 10 global banks are represented in the Global 100, reflecting the large presence of financial institutions on the All Country World Index (MSCI ACWI) of publicly traded companies. The 10 banks on the Global 100 are leaders in their sector.

While the two Canadian life insurance companies made the cut, no Canadian bank did. In fact, Bank of Montreal fell out of the ranking after making it last year. The Bank of Montreal “has been pretty stagnant over the last few years in terms of their exposure to sustainable financing,” Malinsky says. 

Stagnation helps explain why a number of other companies fell off the list this year – to remain leaders, corporations need to continue to up the ante. “A number of other banks in the universe have seen their proportion of sustainable revenues earned from sustainable financing activities grow quite significantly, ” Malinsky adds.

As leaders in corporate sustainability, the Global 100 companies have also provided attractive investment returns for their shareholders. Corporate Knights compared the returns on its Global 100 index against the MSCI ACWI Index.

Between February 1, 2005, and December 15, 2023, the Global 100 saw a return of 287% on a U.S. dollar basis, while the MSCI ACWI had a return of 272%. The Dow Jones Sustainability World Index posted a return of 254% over that period.

The profitability of and solid investment returns from sustainability leaders are critical signals to the laggards that doing well can go hand in hand with doing good. And indeed, a growing number of investors are demanding greater transparency on data in order to align their investment and underwriting with their environmental and social commitments. 

Nowhere is that more true than with regard to climate change and the clean energy transition. Leaders in the transition will be rewarded and laggards penalized as the growing crisis drives governments and businesses alike to reassess their strategic interests and align their plans with a net-zero world. 

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Get the complete Excel scorecard for the Global 100 most sustainable companies of 2024

Methodology

 All companies are scored on applicable metrics relative to their peers, with 50% of the weight assigned to sustainable revenue and sustainable investment. Nine of the indicators have fixed weights; the rest are assigned weights according to each industry’s relative impact in relation to the overall economy. After quantitatively analyzing data for 25 key performance indicators, using the Corporate Knights methodology, this year’s overall scores were converted to letter grades. 

HQ location: Where the company’s headquarters are located

Peer group: Peer group against which company was rated (based on the Corporate Knights peer groups)

Peer group rank: Company’s ranking in peer group

Carbon productivity: Based on company’s revenue to Scope 1+2 CO2e ratio

% Taxes paid: Based on company’s cash taxes paid to profit ratio over past five years

CEO–average worker pay ratio: Ratio of CEO compensation to average worker’s compensation

% Gender-diverse board directors: % of board directors who are not male

% Sustainable revenue: % of revenue earned from products and services that are categorized as “sustainable” under the Corporate Knights Sustainable Economy Taxonomy

% Sustainable investment: % of capital expenditures, R&D and acquisitions that are categorized as “sustainable” under the Corporate Knights Sustainable Economy Taxonomy

Overall score: The weighted average percentile rank scores across up to 25 metrics

Awarded to the top company​

Above 75%

70% - 75%

65% - 70%

60% - 65%

55% - 60%

50% - 55%

45% - 50%

40% - 45%

35% - 40%

30% - 35%

25% - 30%

2023 GLOBAL 100

2022 GLOBAL 100

2021 GLOBAL 100

2020 GLOBAL 100

View All

The post The Global 100 list: How the world’s most sustainable corporations are driving the green transition appeared first on Corporate Knights.

According to Sims’s latest climate report, every tonne of scrap used for steel production avoids 1.5 tonnes of carbon dioxide emissions compared to producing steel from raw materials. The savings, Mikkelsen says, “are enormous” and added up to a savings of 13 million tonnes of carbon dioxide in 2023 alone – equivalent to removing almost three million gas-powered cars from the road for a year.

Mikkelsen also likes to say that Sims – the top-ranked firm on the Corporate Knights 2024 Global 100 list of the world’s most sustainable publicly traded corporations with more than $1 billion in revenue – is not a Johnny-come-lately to the circular economy in general and the business of decarbonizing steel in particular. “We weren’t late to this party,” he says. “We were sending out invitations 100 years ago.”

The iron and steel business is a major contributor to the climate crisis. Globally, this industry generates about 7% to 9% of all anthropogenic emissions, or about 2.6 billion tonnes per year, according to World Steel, an industry body. The sector, moreover, isn’t on track to achieve net-zero targets, despite investments in new forms of low-carbon energy for steel plants. As the International Energy Agency reports, “the current pipeline of low- and near zero-emission projects falls short of what is required to meet the [net-zero] scenario, and high-emission projects” – which is to say, coal-fired steel – “make up around two-thirds of all announced projects worldwide.” 

Recycling scrap, in short, makes more sense than ever, although the process, which involves smelting and other energy-intensive processes, also needs to boost its environmental performance.

Among the firms operating in this vertical, Sims scores highly. It earned the top spot on the Global 100, with 100% sustainable revenue and clean investments, a 95% score on the energy productivity of its operations, and 87.5% on its carbon productivity. The company also ranks highly on a range of social metrics – low employee turnover, for example, and strong gender diversity at both the board and C-suite levels. Mikkelsen adds that the firm has pushed to reduce carbon in its own operations, setting a target of 2025 to transition entirely to the use of renewable energy in its shredding and separating operations, as well as longer-term goals, such as becoming carbon neutral by 2030 and achieving net-zero emissions by 2050.

Its environmental track record is not, however, pristine. In 2022, a B.C.-based metal recycling firm in which Sims owns a stake was slapped with a provincial clean-up order related to the discharge of PCB- and heavy-metal-saturated effluent into the Fraser River; the company is fighting the order in court. The firm has also faced media scrutiny and regulatory action in the U.S. related to air pollution from one of its smelting facilities in the Chicago area. Sims’s 2022 sustainability report notes that the company has sought to comply with state environmental rules by investing US$15 million in an emissions-control system. 

At a high level, Mikkelsen’s pitch to investors is that scrap metal – steel, copper, aluminum, et cetera – has a bright future in the low-carbon economy, thanks to steadily rising demand for electric vehicles, wind turbines, electricity transmission grids, solar panels. “All of those are steel intensive, copper intensive, aluminum intensive.” He points also to the steady growth in the number of metal recycling plants that are either coming online or in the planning stages, in the U.S., Canada, the U.K. and elsewhere. Even countries that traditionally exported scrap metal, like Japan, are building electricity-fired processing  plants. 

But the expansion of demand for recycled metals isn’t immune to market fluctuations. In the past year, global demand for copper has dropped, and the slowing of the Chinese economy has sent ripples through international metal markets. The price of unprocessed scrap, meanwhile, has risen, which means companies like Sims have faced something of a financial squeeze, a dynamic that’s clearly visible in its latest earnings reports. The company generated US$8 billion in revenues in 2023 but saw its profits plunge by 72.9%.

Mikkelsen dismisses these trends as little more than background noise. “We look through the short-term swings and roundabouts of business life,” he says. “The longer-term trend we anticipate is that scrap metal is in short supply.”

We weren’t late to this party. We were sending out invitations 100 years ago.

 

– Stephen Mikkelsen, CEO, Sims Ltd

Yet those swings have forced the company to take a hard look at some of its far-flung holdings so it can, as Mikkelsen quips, “recycle” its capital. For example, Sims finally divested itself of part of its municipal recycling business – a large blue-box operation in New York City. In 2022, the firm sold much of its stake to Closed Loop Partners, a New York–based circular economy fund, and then divested the rest last year. “The New York business was, frankly, largely plastic recycling, and that wasn’t our core business,” he says. (New York’s huge blue-box program is now run by Balcones Recycling.)

Along with a few other divestitures as well as the acquisition of new scrap-processing plants in the U.S., Sims has moved to invest in high-tech sorting equipment designed to recover more of the marketable scrap metal in castoffs like end-of-life automobiles. At one of its plants in Nashville, Tennessee, the company has been piloting new automated sorting systems that have been designed to retrieve valuable metals like copper while separating out substances, like plastics, that don’t have any further value. “We’re using technology like optical recognition and robotics to do the last picking of valuable products out of our recycling and waste streams, which maximizes circularity and creates more value for our customers and our business,” Mikkelsen explains. The firm is also using AI-equipped robots to disassemble spent server racks from data centres. “That’s exciting technology for us, because it improves productivity and the accuracy of what we’re doing there.”

Just don’t expect those kinds of investments to generate much in the way of love from the environmental sector or climate-conscious voters. “We’re not doing those types of things which are very obvious to politicians and, I guess, the public in general. But,” Mikkelsen says, “metal recycling is an extraordinarily important part of how we’re going to decarbonize.” 

The post This scrappy Australian recycling pioneer is the most sustainable corporation of 2024 appeared first on Corporate Knights.