Sustainability Rankings: Impacts on Corporate Sustainability

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Environmental Sciences
Physical Sciences and Mathematics
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Muli, Sharon

Companies are increasingly being held responsible for their actions because of pressure to maintain a positive public perception, comply with legislation, fulfill their company vision, and outperform competitors. An increasing number of organizations now publish sustainability rankings to evaluate the environmental, social, and economic sustainability of companies. While the purpose of many sustainability rankings varies and may range from informing the public to informing investment decisions, many rankings also aim to improve the sustainability of companies. This report identifies changes, both improvements and declines, in the sustainability rankings of eight companies in the health care industry and attempts to connect these changes to corporate sustainability efforts. Interviews of sustainability professionals from within several of these companies provide insight on the causes for changes in rankings, the internal impacts of these changes, and the general impacts of sustainability rankings within their company. This analysis found that many companies have experienced a notable change in one or more sustainability rankings over the past several years. While it was challenging to identify the causes or impacts of a single ranking using externally available information, the interviews proved valuable. The causes of changes in rankings included changes to the company’s sustainability strategy and the development of a cohesive effort to perform well on the rankings that were considered most influential. Rankings that are well-recognized tend to have a greater impact on companies than those that are newer, focus on a specific topic, or are located in only one region. Rankings can generally impact companies by sparking discussion among employees, encouraging companies to evaluate their strategy to communicate sustainability, and providing a platform for sustainability professionals to communicate the company’s successes. Because employees are often drivers for a company’s sustainability, these findings indicate that sustainability rankings may provide a means to drive sustainability when this opportunity is recognized and utilized.

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