Fortune China CSR Ranking 2011
China Domestic CSR Top 50
|CSR Rank||China 500||Chinese Domestic Companies||Industry||Score|
|2||3||China Mobile Limited||Telecom||62.5|
|3||20||Lenovo Group Limited||Technology||62.0|
|4||1||Sinopec||Oil & Gas||56.3|
|7||18||China Shenhua Energy||Basic Materials||52.6|
|8||37||China Coal Energy||Basic Materials||51.9|
|9||8||China Construction Bank||Financials||47.3|
|10||10||Bank of China Limited||Financials||45.3|
|11||13||China Metallurgical||Basic Materials||44.5|
|12||26||Bank of Communications||Financials||42.9|
|14||4||China Railway Construction Corp||Industrials||41.4|
|15||28||Shanxi Taigang Stainless Steel||Basic Materials||41.2|
|15||29||Aluminum Corporation of China||Basic Materials||41.2|
|17||46||Datang International Power||Industrials||41.1|
|18||16||China Ping An Insurance||Financials||40.8|
|18||57||CITIC Bank Corporation Limited||Financials||40.8|
|21||35||China Southern Airlines||Airlines||40.2|
|23||11||China Communications Construction||Industrials||39.9|
|24||54||Zhuhai Gree Electric Appliance||Consumer Electronics||39.7|
|25||21||CNOOC||Oil & Gas||39.0|
|27||30||Angang Steel Company Limited||Basic Materials||38.9|
|29||2||PetroChina Company Limited||Oil & Gas||37.4|
|30||17||Shanghai Automotive Group||Automobiles||37.0|
|31||42||China Merchants Bank||Financials||35.8|
|32||34||Shanghai Electric Group||Industrials||35.2|
|36||24||Dongfeng Motor Group||Automobiles||32.0|
|37||52||TCL Group||Consumer Electronics||31.4|
|38||38||Wuhan Iron and Steel||Basic Materials||29.6|
|39||22||China Pacific Insurance||Financials||29.5|
|40||63||China Eastern Airlines||Airlines||29.0|
|41||6||China Life Insurance Company||Financials||28.8|
|43||9||China State Construction Engineering||Industrials||27.1|
|44||56||Hunan Valin Corporation||Basic Materials||24.6|
|45||5||China Railway Group Limited||Industrials||23.9|
|46||61||China North Vehicle||Industrials||23.7|
|47||41||Jiangxi Copper Company Limited||Basic Materials||22.7|
|48||49||China South Locomotive||Industrials||21.8|
|50||39||Maanshan Iron & Steel||Basic Materials||18.1|
Multinational CSR Top 50
|CSR Rank||Global 500||Multinational Companies in China||Industry||Score|
|2||2||Royal Dutch Shell||Oil & Gas||67.5|
|13||121||Unilever||Household & Personal Goods||61.4|
|17||44||Wal-Mart||Household & Personal Goods||59.0|
|19||66||Procter & Gamble||Household & Personal Goods||58.9|
|19||4||BP||Oil & Gas||58.9|
|21||402||Ricoh Co., Ltd.||Technology||58.8|
|24||161||Dow China||Basic Materials||56.3|
|27||26||Hewlett & Packard||Technology||55.6|
|34||455||Kimberly-Clark||Household & Personal Goods||52.7|
|35||342||L'Oréal||Household & Personal Goods||52.4|
|38||231||Royal Philips||Consumer Electronics||50.5|
|40||479||Sanyo Electric||Consumer Electronics||49.4|
In the Accountability - Fortune China Managerial CSR Survey 2009, ‘lack of knowledge’ was described as the primary obstacle facing Chinese businesses wishing to operate in a more socially responsible way. To that end, Fortune China and InnoCSR Co. Ltd have worked to develop the 2011 China CSR 100 Ranking, which aims to raise awareness of CSR, to highlight best practices and begin a meaningful conversation between companies and their stakeholders. By putting the spotlight on company CSR performances, the Fortune China CSR 100 Ranking delivers both ‘carrots and sticks’ to companies in China; giving recognition on the most socially responsible companies and a needed wake-up call to the laggards.
HOW WAS THE RANKING DEVELOPED?
The Fortune China CSR Ranking 2011 was developed by the research team at InnoCSR Co. Ltd., a Shanghai based consulting firm specialized in CSR strategy and experts in the criteria used to assess the social responsibility of companies. Guidance was provided by the Research board comprised of:
Fortune China CSR Ranking 2011 Research Board
• Mr. Sam Yoon-Suk Lee, Founder and CEO of InnoCSR
• Dr. Zhou Zucheng, Professor of Management and Business Ethics at Shanghai Jiaotong University
• Dr. Bala Ramasamy, Professor of Economics, China Europe International Business School
• Dr. Jay-Hyuk Rhee, Professor of International Business & Strategy, Korea University Business School
• Mr. Zhou Zhanhong, Assistant Managing Editor , Fortune China
In creating the ranking, the research team aimed to strike a balance between global and local CSR agendas. Initially, a basket of the world’s leading CSR ratings, reporting standards and prominent environmental and social standards were studied, from which key criteria were indentified (see Fig. 1). The team capitalized on InnoCSR’s extensive in-house understanding of China’s CSR environment, and conducted additional tailored interviews with experts to understand China’s unique domestic CSR agenda.
Having indentified the most critical CSR issues, performance indicators were extracted and regrouped to form a ranking framework. The framework was structured around the industry recognized parameters of Environmental, Social and Governance (ESG).
The newly released ISO26000 ‘Guidance on Social Responsibility’ was one of the documents on which the Fortune China CSR 100 Ranking was benchmarked. Since its release on November 1st, 2010, there has been growing interest in ISO26000’s ‘Guidance on Social Responsibility’. Created with participation from 99 countries from the developed and developing world the document was ratified by the Chinese government. While ISO26000 and the Fortune ranking frameworks differ in structure and, notably the stress placed on Chinese CSR issues, there was significant overlap between the two. The Fortune China CSR 100 Rank framework covered all 7 core subjects mentioned in ISO26000, and 33 of the 36 related issues.
WHAT DOES THE FORTUNE CHINA CSR RANKING MEASURE?
Fig.1 Fortune China CSR 100 ranking domains
|Environmental Management||Labor Practices||Board Structure & Diversity|
|Pollution Prevention||Customers||Fair Marketplace Practices|
|Resource Use||Community||CSR management|
|Climate Change & Biodiversity||Supply Chain & Human Rights||CSR communication|
Companies are ranked based upon their aggregated score across 3 domains, each comprised of 4 equally-weighted criteria. These 12 criteria are further divided into 180 scoring indicators. The scoring indicators represent the actual set of questions we wish to answer about the company.
Ranking is based upon the aggregated score for the three domains, however the weight assigned to each domain will vary depending on the sector in which the company operates. For companies in sectors with a high impact upon the environment (e.g. basic materials and airlines), additional emphasis is given to their environmental performance, and vice versa, companies in sectors with a lower environmental impact have a higher weight assigned to social performance. For all sectors, governance criteria account for 30% of the overall score (see Fig. 2).
Fig. 2 Sector Weighting on ESG domains
|Oil & Gas||40||30||30|
|Household & Personal Goods||30||40||30|
*The basis for the sector weights was derived from the FTSE4Good Environmental Leaders methodology. FTSE4Good Environmental Leaders categorizes industries into high, medium or low impact. For the purposes of the Fortune China CSR 100 ranking this was converted into a two-tier high-low impact scale.
HOW WERE THE COMPANIES CHOSEN?
Fig. 3 Sector Breakdown
|Oil & Gas||3||2|
|Household & Personal Goods||0||5|
The company population for the ranking includes both China domestic and multinational companies. Domestic companies were chosen based upon their ranking in the Fortune 500 China Companies 2010 (based on revenue). Firms were then screened for the presence of a fiscal 2009 CSR report, and the highest ranking firms are then selected for inclusion in the ranking population.
The population of multinational companies was derived from the Fortune Global 500 2010 list, and further screened to include companies with significant revenues in mainland China (based on data from China’s Ministry of Commerce). Multinationals were required to have published consistent global CSR report for the last 3 consecutive years.
The Fortune China CSR 100 Ranking offers a standardized assessment of CSR practices across the leading companies in China. Scoring relies upon corporate public disclosures (annual reports, CSR reports, website disclosures), as well third party sources which we deem to be reliable. Unfortunately, some companies, especially in China, are less accustomed to public reporting. If relevant information is not found, it may result in a poorer ranking of the company. Furthermore, for the Fortune China CSR 100 Ranking analysts limited their analysis to data within a specific window of time (2009 - 2010). Data relating solely to activities conducted prior to this period were not recognized and those without a CSR report for fiscal year 2009 could not be ranked.
We understand that CSR expectations are constantly changing and therefore we seek to improve our methodology on a continuous basis via regular review of our assessment criteria with the Research Board and external stakeholders. Through such efforts we endeavor to maintain the quality and reliability of the Fortune CSR 100 Rank now and in the future.