Corporate Knights
Finding sustainable companies and good ESG stocks can be hard. I mean, it’s not like there’s a list of the best sustainable companies out there, right? WRONG!
This list actually does exist. Each year Corporate Knights publishes a list of the most sustainable companies in the world; The Global 100.
First off, Corporate Knights is a media company that focuses on the publication of financial research covering ESG and sustainability. They describe themselves as “the voice for clean capitalism” and their vision is “to provide information empowering markets to foster a better world”. What a vision statement. I just love that.
Every January Corporate Knights publishes a list of the top 100 most sustainable companies in the world. They’ve been publishing this list every year since 2005. The best part is that the 2021 list is totally free!
Although they do accept donations and you can also purchase their magazine as well. And before you ask; no, this article is not sponsored and I have no affiliation with Corporate Knights. I just think this organization does some great things.
This Global 100 list is an incredible resource for ESG investors looking for quality companies to invest in. I actually recently invested in two different companies that I found from this list.
ESG Ranking Methodology
The first thing you might notice when you download this list is just the sheer amount of information on the spreadsheet! Corporate Knights didn’t just publish a 1 to 100 numbered list of their favorite companies.
They look at 21 different key performance indicators covering environmental, social, and governance factors. You can see all of these key performance indicators in the spreadsheet. This covers everything from energy productivity to supplier sustainability scores.
I’m not going to go over each key performance indicator in this article because that would just take forever. But if you are interested in learning more, Global Knights is extremely transparent and publishes their rating methodology for this top 100 list. This is a 59 page document and goes into a lot of depth on each specific metric they look at as well as how they negatively screen companies from their list. You can find this document HERE.
Corporate Knights looks at the full universe of publicly-listed companies from all across the world. They then begin screening out companies based on certain criteria. They look for companies that have gross annual revenues of over $1 billion dollars. They then look at sustainability disclosure practices, the financial health of these companies, product categories and behavior, and any potential financial sanctions.
Corporate Knights looks at a number of different metrics and negatively screens out companies involved in several different industries and product categories. This includes:
- Farm Animal Welfare
- Industrial Meat
- Corporate Fines, Penalties, or Settlements
- Tobacco
- Controversial Weapons
- Conventional Weapons
- Small Arms
- Blocking Climate Policy
- Severe Environmental Damage
- Thermal Coal
- Tropical Deforestation
- For-Profit Prison
- Repressive Regime
- Global Compact Principle Violators
- Gambling
- Pornography
- Excess of Conventional Over Clean Energy
- Freedom of Expression and Privacy on the Internet
The List
So again, there are 100 different companies on this list so I won’t be going over each one individually. I’m a little bit of an Excel and Google Spreadsheet nerd so I went ahead and I made some changes and some additions to Corporate Knights’ original spreadsheet.
What’s nice about having this information in a spreadsheet format is that you can filter and sort the data based upon what is most important to you. You may only be interested in US-based companies. In that case, you can screen out all non-US companies.
Or you may be more interested in gender and racial diversity among company leadership. You can sort the spreadsheet to look for the companies with the highest ratings in those areas.
Corporate Knights included a ton of information in this spreadsheet so you can sort through this based on whatever measures best align with both your financial goals and your personal values.
To make this list a little more useful, I also added a few different items to this spreadsheet; the market cap, price to earnings ratio, and a one-year chart so you can get a very quick snapshot of each company. This just provides a quick way to look at some company trends; the sizes of these companies, valuations, and a general idea of how the stock has performed over the last year.
I also added the current stock price as well as the 52-week highs and lows. That way you can get a feel for where the current stock price falls in relation to the price over the last year.
Of course, it is important to remember that ESG investing is still investing and I try to follow the Warren Buffet value investing philosophy. A great company can still be a poor investment if you pay too high a price for the company. So always make sure you’re doing your research before you invest.
New Investment Ideas
I think this list from Corporate Knights is an amazing resource and a great way for ESG investors to get some new investment ideas. Like I already said, I wound up investing in two different companies that I originally found from this list.
Corporate Knights’ Global 100 List includes some pretty well-known companies like Alphabet, Tesla, Nvidia, Intel, and Cisco.
But also remember that this is a global list. There are quite a few companies on this list that I know I’ve personally never heard of.
Again, always do your own investment research. If you’re investing in individual stocks you’ll obviously want to spend a lot more time researching those specific companies and industries. A simple spreadsheet like this one won’t provide enough investment information by itself.
I originally updated this spreadsheet for my own personal use but I figure that some of you may find some value in this so I’m going to share with all of our readers right HERE!
Just a quick note; Google Sheets does a pretty good job tracking financial information but it has a much harder time pulling the data for foreign companies.
Because of that, there are some companies on this list where the financial information does not automatically update. There are about 4 or 5 companies on the list like this. I highlighted those companies in red just to make them stand out. This list is really just meant to be a quick look and overview so if you’re interested in any of those 5 companies you’ll have to do some additional research.
Financial Performance
So right before I was about to finish up this article I had the wild thought to look at the financial performance of all of the companies on this list.
So I just added some quick calculations to the spreadsheet and here’s what I found…
As of this article:
The 2021 Corporate Knights Global 100 year-to-date performance is 26.14%.
I always benchmark performance against the S&P 500. And the S&P 500 has a year-to-date performance of 20.91%.
That’s a difference of over 5%. I know I’ve said it in previous articles but I’m going to say it again. Although something like 5% may not seem significant, 5% is HUGE over the course of an investing career.
Keep in mind that I just pulled this information using some quick auto-calculations so those numbers don’t include the companies where the pricing information isn’t available through the Google spreadsheet.
That all being said, those numbers got me pretty excited and I’m thinking about doing some additional research and backtesting to see how the performance of Corporate Knights’ Annual Global 100 lists stack up against the S&P 500 throughout the years.
Corporate Knights has been publishing these Global 100 List since 2005 so it could be pretty interesting to look at this. This would probably take quite a bit of work but if this is something you might be interested in then let me know in the comments below.
Share Your Feedback!
So there you have it. A list of the top 100 most sustainable companies in the world according to Corporate Knights.
What are your thoughts about this list? Are there any companies on here that surprised you or is there a company you feel deserved to be included on the list? Share your thoughts in the comments below.
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