EDF report highlights ‘blind sports’ in corporate sustainability rankings
A new report published by EDF titled ‘The Blind Spot in Corporate Sustainability Rankings: Climate Policy Leadership’ outlines that many sustainability rankings and lists do not consider public policy advocacy or corporate lobbying activities in their evaluation- a core element of sustainability leadership. These rankings are, in a sense, providing misinformation to stakeholders, as they do not factor in a company’s opposition to or support of climate/environmental.
The sentiments expressed in the report are echoed by Harvard Business Review, which highlighted “Green ratings ought to include political transparency scores to get a fuller picture of corporate greenness.”
Further investigation as to why only one of the most popular sustainability rankings considers public policy is the lack of transparency in general regarding political activity. This makes evaluating the ‘greenness’ of a company much more difficult.
Calls to make this aspect of business more transparent can be heard from various stakeholders, including the public and shareholders. Many are demanding that list-makers require political activities be disclosed if companies wish to be included in rankings-encouraging greater transparency across the board, and improved insight into their sustainability performance.
Evaluation of this information may prove difficult, but the report suggests that companies answer questions from the U.N. Global Compact Guide for Responsible Corporate Engagement in Climate Policy, in order to provide consistent information across various ranking platforms.
For more information, or to read the full report, click here.