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In sustainability, perception isn't always equal to reality

New study from Brandlogic and CRD Analytics suggests than some companies get more credit than they deserve, including Apple and Google.

There are certain companies that you just KNOW have better corporate sustainability strategies than others, right? Well, not exactly. Two big examples, according to a new study from consulting firm Brandlogic and analytics firm CRD Analytics: Apple and Google. Both of these companies have a higher reputation for sustainability measures than is actually deserved, according to the study.

Brandlogic and CRD Analytics joined forces to figure out whether public perceptions of 100 leading companies really are indicative of those same companies' actual performance when it comes to environmental sustainability and corporate social responsibility. Their study, called the "Sustainability leadership report: Measuring perception vs. reality," found that perceived sustainability performance exceeded actual performance for 66 of the 100 firms. That measure is something that the companies are calling the Sustainability IQ Matrix. Their study also revealed pharmaceutical companies as consistent standouts in terms of both perceived and actual sustainability performance.

There were 175 different environmental, social and governance related metrics used to rate the companies on the list. Within those categories, here are the really important things:

  • Environmental: Waste, energy, water, emissions, risk mitigation
  • Social: Product responsibility, community, human rights, diversity and opportunity, employment quality
  • Governance: Board functions, board structure, compensation, vision and strategy, shareholder rights

The research actually looked at 1,200 companies in total, and then focused on the smaller subset. The matrix breaks up into four quadrants. I'm mentioning a couple of companies in each group where the gap between perceived and actual performance is bigger than most. In some cases that is good, in other cases, it is not so good.

  1. Challengers: Described as firms that don't get enough credit for their strategy. Two companies of particular note here are Citi and UBS, which have legitimate claims to leadership but don't actually get adequate credit.
  2. Leaders: Companies that have relatively high actual and perceived sustainability performance. Among the companies mentioned in this sector: Walt Disney, ABB, Abbott Labs, IBM, BMW, Nokia (ironic, no?) and BMW. The information technology sector is well-represented within this group. IBM and Hewlett-Packard are both category leaders. There are NO leaders from the financial services sector in this group.
  3. Laggards: Businesses that have a low commitment to sustainability, according to this study. Here are companies that get flagged: 7-Eleven, Amazon, American Airlines, Avon, ConocoPhillips, Japan Airlines, McDonald's, Research in Motion, and Xerox.
  4. Promoters: Firms that manage to get more credit for sustainability than they actually deserve. Of particular note here are Apple, Google, Honda, Visa and Yahoo! As you might expect, the consumer products sector has more companies in this group than any other sector, accounting for more than one-third of all the companies in this group.

Said Brandlogic senior partner James Cerruti: "We want the 100 companies, as well as firms who were not analyzed, to look at the report and ask key questions about any reputational risks they may be facing and identify potential opportunities for improvement. Our goal is to help companies achieve results by better aligning their branding, communications, reporting and stakeholder engagement processes around these emerging priorities."

This post was originally published on Smartplanet.com