As political and business leaders gather for the World Economic Forum in Davos, Switzerland, this week, a roster of the most sustainable companies is also enjoying a moment in the spotlight.

The list, the Global 100, ranks large corporations across the globe on their performance reducing carbon and waste, their gender diversity among leadership, revenues derived from clean products, and overall sustainability. In its 15th year, the ranking is compiled by a Canada-based sustainability-focused financial information company and magazine, Corporate Knights, beginning with a list of about 7,500 companies, all of which generate more than $1 billion in annual revenue.

To see the full list, scroll to the bottom of this article.

Ranking number one this year on the Global 100 is Chr. Hansen Holding, a Danish bioscience firm that derives over 80% of its revenue developing natural solutions for preserving foods like yogurt and milk, protecting crops using natural bacteria instead of pesticides, and alternatives to antibiotics for animals.

Corporate Knights cofounder and president Toby Heaps told Forbes that Chr. Hansen’s first-place standing was a bit of a surprise and that the company, founded in 1874, is a relative unknown to many. “It’s not a consumer-facing company,” he says. “But it probably impacts a lot of the calories of hundreds of millions of people every day and makes the food that they’re consuming safer.”

Nearly 30% of the Danish billion-dollar-business’ board is made up of women, according to the Corporate Knights study, and its CEO salaries are about 24 times those of an average worker with the firm—a relatively low ratio for the ranking.

In second place on the roster is Kering SA, a French firm better known for the consumer-facing brands it owns: fashion houses Gucci, Yves Saint Laurent and Alexander McQueen, among others. The brand has shown it takes sustainability seriously by sourcing more than 40% of its products from certified sustainable sources, says Heaps, and is always scanning for ways to improve that percentage.

Also noteworthy is that more than 60% of Kering’s board of directors is composed of women—the gender makeup of most large corporations shows less than 20%. The glass ceiling at Kering, says Heaps, has “been completely shattered.”

Third in the Global 100 ranking is Neste Corporation, which held second place last year. Based in Finland, Neste is a petroleum refinery and marketing company with annual revenue of more than $10 billion.

“Until very recently it was a fossil fuel company refining oil to be burned and creating greenhouse gas emissions in the process,” says Heaps. But the firm shifted, and now more than 50% of Neste’s investments are into the development of products like renewable biofuels. As it stands, 25% of the company’s revenue comes from biofuel refining, and it’s aiming to increase that figure in the coming years. Also noteworthy is that Neste’s biofuel business represents 50% of its profits, says Heaps. “So they’re earning a higher margin on their biofuels business—even though it’s only a quarter of their revenue, it’s half their profits.”

Neste shareholders aren’t bemoaning the company’s shift, as share prices have risen 300% in the past five years, says Heaps. But shareholder satisfaction is, according to Corporate Knights’ calculations, more likely with companies that place emphasis on sustainability. Tracked between 2005 and 2018, Global 100 companies made a net investment return of 127.35%, compared with 118.27% in returns from companies on the MSCI All Country World Index.

This is the second year that Corporate Knights’ Global 100 has used “clean revenue” as a performance indicator—measuring the percentage of revenue a company generates through sustainable products. This is the first year that clean revenue has carried so much weight in the ranking; accounting for 50% of a company’s score.

To compile its Global 100 ranking, Corporate Knights uses a 10-person in-house team of researchers and data scientists—as well as 50 outside data collectors—to plow through financial and ecological information from Bloomberg, Thompson Reuters and other sources. They then verify some of that information with the companies they’re researching and internally vet incoming data. The entire research process requires sifting through 3.7 million data points and takes about 5,000 hours of work, says Heaps.

For more information on the methodology behind the ranking, click here.

Source: Forbes