Vodafone is the World’s Number One Most Accountable Business
Annual rating ranks global business, industries and regions
October 23rd 2006, London: Vodafone Group is ranked number one in this year’s global Accountability Rating, narrowly overtaking BP, which has been ranked number one since 2004. Royal Dutch Shell is ranked number three.
Vodafone’s CEO Arun Sarin comments: “Trust is a pre-condition for doing business. And it is directly linked to being accountable for your actions as a company. I am pleased to see Vodafone ranking first in the Accountability Rating.”
The Accountability Rating is led by AccountAbility, the global think-tank on organizational and corporate accountability, and csrnetwork, the leading UK corporate responsibility consultancy. This year’s ranking consists not only of an assessment of the world’s largest corporations, including the top 50 companies from the Fortune Global 500® but also of a number of country specific lists in Russia, South Africa and Hungary.
Simon Zadek, chief executive of AccountAbility, gave guarded applause to the leaders in the Rating, highlighting critical gaps in implementation and assurance:
“Envisioning a sustainable business strategy is a good first step, but implementation is where the going gets tough. This year’s results show that business has made good progress, yet there’s a long way to go in embedding sustainability in everyday practices. Policy implementation and 3rd party assurance are key areas where improvement is needed”.
Mark Line, managing director of csrnetwork observes that the Accountability Rating provides an unparalleled insight into how the world’s best companies tick. He says:
“With in-depth knowledge accumulated through the global rating over the past few years, combined with this year’s new country specific lists, the 2006 Accountability Rating is providing a unique route-map for companies who want to improve their own CSR performance.”
Oil sector accountability slips to last place
Although former pioneers like BP and Royal Dutch Shell continue to demonstrate commitment to accountability processes, this year’s findings show that the average score for the petroleum sector as a whole has dropped significantly, compared to 2005, and now ranks bottom of the five-sector industry ranking.
A combination of poor performance from companies such as PDVSA, Valero, China National Petroleum and Sinopec, combined with tougher criteria in this year’s analysis have played a part in this slippage. Simultaneously, other sectors, notably financial services have caught up with the ‘early running’ made by the petroleum sector in developing corporate responsibility.
Overall, business accountability has improved, given that this year’s criteria were tougher than 2005, reflecting mainstream acceptance of social responsibility.
Top Ten companies
The top ten companies in this year’s rating now include a mixed bag of sectors. The leaders, in descending order are: Vodafone (1); BP (2); Royal Dutch/Shell Group (3); Électricité de France (4); Suez (5); Enel (6); HSBC Holdings (7); Veolia Environnement (8); HBOS (9); Carrefour (10).
Top Five improvers
The top five improvers are HBOS; E.ON; Volkswagen; Fiat and Home Depot.
Areas of improvement in 2006
Of the six key measures of accountability (see below), the most marked performance increase has been in stakeholder engagement, with more companies systematically consulting their stakeholders. There have been notable increases in local community and Government engagement, while contractors, business partners and, notably, trade unions hardly register in the engagement process.
Areas of weakness in 2006
Of the six key measures of accountability (see below), performance management and assurance remain areas where business has the most to improve.
Regions
Europe remains the leading region when it comes to accountability. Asia has slipped from second to third behind the USA.
South Africa…
Is a global leader when it comes to stakeholder engagement with business doing more than most, partly due to legislative pressures for black economic empowerment, and partly due to a national history teetering on the edge of civil conflict, in which open dialogue has become a key element of successful business.
Russia…
Perhaps not surprisingly, Russia’s average score is only half of the global average. However, a large number of first-time sustainability reporters is an encouraging indicator that the accountability of Russian companies is improving fast.
What is the Accountability Rating?
The Accountability Rating is a proprietary tool developed jointly by AcountAbility, a London think tank on corporate and organizational accountability, and csrnetwork, the leading UK CSR consultancy. It measures the extent to which companies have built responsible practices into the way they do business and looks at how well they account for the impact of their actions on their stakeholders.
The analysis is based on a range of factors:
Stakeholder engagement. Does the company engage in dialogue with people who have an interest in, may be affected by, or may affect its business?
Governance. Do senior executives and the advisory board properly consider stakeholder issues when setting strategy and formulating corporate policy?
Strategy. Does the core business strategy integrate social and environmental targets with financial ones?
Performance management. Do the company’s management processes, business standards, incentives, and targets seek to achieve social and environmental goals?
Public disclosure. Does the company provide a detailed report of social and environmental performance?
Assurance. Does the company secure appropriate independent assurance?
For full results, see: www.accountabilityrating.com as of the 23rd of October
For further information please contact:
James Thellusson / Luke Merryweather, AccountAbility
james@accountability21.net or luke@accountability21.net
The Accountability Rating 2006 is first published exclusively in FORTUNE,
the world’s premier business magazine in the October 30 2006 issue and online at www.fortune.com on 23 October 2006.
