Westpac, GPT and Woolworths are head of their class in the 2014 Dow Jones Sustainability Index World Rankings, taking out top scores in banking, real estate, and food and staples retailing, respectively. Other Australian firms did not do so well, with BHP Billiton this year being cut from the league, as were multinationals General Electric, Colgate Palmolive, Nike, McDonalds and Starbucks.
Sustainability investing specialist RobecoSAM, which undertook the analysis of all 1813 firms that submitted information for the DJSI rankings, noted in its report on GPT that climate change and energy efficiency were of “great importance for this industry as buildings are responsible for about one-third of global greenhouse emissions”.
“Additionally, low-energy buildings that use innovative materials reduce the impact of volatile energy prices on the cost of management and ownership of a property,” the report stated. ?“This results in high demand for residential, commercial and industrial green buildings. In addition to environmental issues, social responsibility and social integration are gaining importance in this industry. In the current volatile economic environment, community engagement and investments in areas surrounding properties are receiving increased attention to maintain asset values high and remain the preferred proprietor for tenants.”
This year, four Australian companies, including Commonwealth Bank, made the rankings for the first time, while 12 were deleted. In total, 200 Australian firms were invited to submit information for analysis.
The assessment criteria this year covered tax strategy (to address the growing risks associated with tax optimisation schemes); social and environmental reporting factors, including materiality; human capital development policies; and performance scoring related to occupational health and safety, and talent recruitment and retention.
“Both the importance and the understanding of sustainability has grown dramatically over the past decade and a half. During that time the Dow Jones Sustainability Indices have been established as the leading benchmark in the field,” David Blitzer, managing director and chairman of the S&P Dow Jones Index Committee, said.
The DJSI was the first global index to track the financial performance of sustainability-driven companies worldwide based on analysis of financially material economic, environmental and social factors. This is the 15th year of the rankings.