HP, Coca-Cola and FedEx knocked off Dow sustainability indexes

Some very high-profile companies slipped from inclusion on the high-profile sustainability performance indexes.

Updated on Sept. 15 to correct an error in the explanation of how the lists are compiled. The correction is in the italicized paragraph.

Samsung Electronics may be having a devil of time in the market getting its tablet computer off the ground, what with all the legal challenges it faces from Apple, but it did manage one really great achievement this week: The company was named the sector leader for technology on the latest sustainability indexes released by Dow Jones and SAM, an investment boutique that advises on sustainable investing.

That achievement is all the more vivid when you consider the three technology giants that were knocked off the Dow Jones lists for 2011. Hewlett-Packard and Fujitsu were both deleted from the world version of the list, while Microsoft was cut from the North American edition.

Here's how the index is compiled. Each year, SAM and Dow Jones ask the 2,500 largest companies in terms of free float market capitalization from all sectors of the Dow Jones Global Total Stock Market Index to "report" about their sustainability performance. A company gets on a list if it winds up in the top 10 percent (for the World list) or top 20 percent (for the North America list) with respect to sustainability. They have to have a score or rating that is AT LEAST 50 percent of the score for their sector leader. Getting knocked off the lists means the company no longer score according to those metrics in terms of sustainability.

This year, there were some very high-profile deletions from the world list. Here are those 10 largest deletions (listed by descending order of their free float market capitalization):

  • Coca-Cola
  • HP
  • EnCana
  • Royal KPN
  • Denso
  • Sumitomo
  • Essilor
  • PG&E
  • Saipem
  • Fujitsu

From a North American standpoint, here are the 10 largest deletions (again, listed in order of descending market cap):

  • Microsoft
  • Coca-Cola
  • Goldcorp
  • FedEx
  • Enbridge
  • McKesson
  • Waste Management
  • El Paso
  • Allstate
  • National Bank of Canada

On a brighter note, here are some of the high-profile North American companies that made it onto one or more of the various lists: EMC, CSX, Allergan, AFLAC, Sprint Nextel, Kohl's, Xerox and Schneider Electric.

I use this index as a guidepost for which companies are translating their sustainability programs into meaningful operational results. Because I cover technology, none of the additions from above surprise me and the deletions, especially HP, are more a sign of fundmental strategic challenges as opposed to any major shift in sustainability strategy.

This post was originally published on Smartplanet.com


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