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Calvert Research and Management developed its 8th annual ranking of the Barron’s Most Sustainable U.S. Companies by analyzing the 1,000 largest U.S. publicly traded companies, evaluating them across more than 230 key performance indicators and whittling the universe down to 100. Calvert rated each company on its demonstrated responsibility in five key stakeholder categories: planet, workplace, customers, community, and shareholders—and assigned each company weightings for the categories based on what is most relevant to their business operations and risks.
Six themes emerged as key drivers of sustainability for this year’s group of 100 Most Sustainable U.S. companies and many of the companies on the list are leaders in more than one focus area:
Climate Aligned & Adaptation
This group of companies manage revenue-generating, climate-focused product offerings which include building efficiencies, climate impact analytics and asset-life extension, reaching throughout its value chain.
Climate Solutions & Energy Transition
Companies that fall into this category focus on innovation via capital expenditures and research and development spending. This is often realized through energy efficient technologies, revival of old nuclear plants, green building certifications, renewable energy solutions, focus on not just scope 1 & 2 but also scope 3, electrostriction, recycled raw products, strategic acquisitions, automation, Industrial Internet of Things (IIOT), energy efficient end-products.
Circular Economy & Sustainable Materials
Leaders in this theme approach circularity through four ways – by generating new products from waste, by using recycled materials in the production process, by producing products that are easy to recycle and by producing products that make it easy to recycle other products and resources.
Human Capital: Innovation and Skilled Workforce
Leaders in Human Capital focus on talent acquisition (including apprenticeships), retention, and management via robust engagement programs, incentive plans, pay equity disclosures, and training programs including university partnerships. They have clearly defined and solidly executed diversity, equity and inclusion programs with board-level oversight.
Sustainable Supply Chain
Companies included in this group have strong policies in place that mitigate supply chain risks, such as human rights violations, conflict materials/products, and labor issues, as well as responsible procurement policies that support the sustainable sourcing and use of materials and resources by suppliers through the entire value chain.
Good Governance
Good Governance is achieved by these companies through executive compensation packages that align with shareholders and are tied to company's sustainability goals, independent board oversight, fostering an inclusive and equitable work environment, and a focus on transparency and ethical decision making.
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Comments from Calvert leadership:
- “Overall strong governance leads to a strong company. We look at board structure, financial responsibility, ethics, and executive compensation,” says Helen Mbugua, Calvert’s director of research.
- “It has become easier to drop down or off the list because the degree of difference between companies has narrowed as more data has become available to help companies take care of their ESG practices,” says Chris Madden, a portfolio manager who manages ESG-related research at Calvert.
- “DEI is a component of human capital, but the way we think about it is how companies are able to attract and maintain their employees and create a culture to maximize productivity, because that leads to long-term strong performance,” says Jade Huang, Calvert’s chief investment officer.
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