The Ethics Envelope, Please
from
September/October 2007
by Laura J. Finn
Ethics and profits do too go hand in hand—just ask
Ethisphere
. The Phoenix, Arizona-based magazine has published a list of what it considers the world’s most ethical companies in various industries—there are 92 winners out of a field of 5,000—and it used a strong bottom line as one of the measuring sticks. See the table at right for the U.S. winners.
Among the more surprising champions is oft-criticized McDonald’s (think cholesterol and childhood obesity),
which won in the food-service category. “We’ve heard, ‘How can that be?’” says the magazine’s executive editor, Alex F. Brigham, about
this particular choice. “But McDonald’s has shown leadership over five years with nutritional disclosures, sustainable packaging, and ethical purchasing practices.” And it made profits over that same period. “We want companies to want to make money. That’s the way to continue business. It’s pragmatic,” Brigham says.
Winning companies didn’t have to have chief ethics officers but did need formal ethics and compliance programs.
Ethisphere
also rated outfits’ involvement in the communities where they operate, and how they treat their employees, clients, and suppliers. The judges interviewed “socially responsible” investors, along with the companies’ CEOs, other executives, vendors, and customers. Some companies fell out of the running fast because of legal problems, including charges that they’d backdated stock options.
U.S. Winners
The champs include 55 U.S. companies in 26 industries. There are no U.S. winners in the banking, electronics, or oil and gas categories.
Agricultural and food processing
: Dole Foods, Dunavant Enterprises
Apparel
: Gap, New Balance Athletic Shoe, Nike, Patagonia, Timberland
Automotive
: Johnson Controls, Modine Manufacturing
Business services
: Paychex, Pitney Bowes
Chemicals
: Ecolab
Computers and semiconductors
: Sun Microsystems, Texas Instruments, Xerox
Consumer products
: S.C. Johnson & Son
Consumer services
: Bright Horizons
Diversified industries
: GE, Koch Industries
Energy and utilities
: Duke Energy, FPL Group
Engineering and construction
: Fluor, Trex
Financial services
: American Express, Berkshire Hathaway, PNC Financial Services, Principal Financial
Food and beverage
: Kellogg, PepsiCo, Stonyfield Farm
Hotel and hospitality
: Marriott
Industrial manufacturing
: Caterpillar, Deere, Eaton, Milliken & Co.
Insurance
: Aflac, Geico
Media and entertainment
: Kiplinger, Time Warner
Medical devices
: Baxter International, Becton Dickinson
Metals and mining
: Alcoa
Paper and packaging
: International Paper, MeadWestvaco
Pharma and biotech
: Genzyme
Restaurants and cafés
: McDonald’s, Starbucks
Retail
: Costco Wholesale, Target, Wegmans Food Markets, Whole Foods Market
Software and Internet
: Google, Salesforce.com
Telecom
: Avaya
Transportation and logistics
: UPS
