Applied Materials Named to Newsweek’s Annual Green Rankings

Oct172011

For the third year in a row, Applied Materials has been named to NEWSWEEK Magazine’s Green Rankings – an annual environmental ranking of the 500 largest U.S. companies.

Newsweek made some significant changes to the ranking methodology this year and, consequently there was quite a bit of musical chairs in the results. One change in the methodology that undoubtedly proved important was the elimination of a reputation score and the addition of a disclosure score (evaluating the breadth and quality of company environmental reporting). Only 5 of last year’s top 10 companies are in the 2011 top 10, including IBM, H-P, Sprint, J&J and Dell. Yahoo, #9 in 2010 is #93 this year; Nike, #10 last year is #143 this year. In addition, some U.S. companies with outstanding reputations for environmental performance are surprisingly far down this year’s list, e.g. General Electric #63, Whole Foods #106, First Solar #223, Campbell’s Soup #262, PG&E #330. John Elkington, one of the true pioneers in the sustainability field, commenting on the list, predicts: “The next decade could see an intense weeding out of even some of the companies at the very top of the Newsweek rankings.” According to Elkington, we should be looking for companies that are aiming for disruptive environmental innovation rather than mainstream performance.

So what should Newsweek readers and others make of the list? Newsweek has a lot of name recognition and the Green Rankings are a welcome means of educating the public about corporate environmental programs. On the other hand, despite the hard work and analytical capabilities of Newsweek and its partners (Trucost and Sustainalytics), it is extraordinarily difficult to compare hundreds of companies across multiple dimensions and metrics when each of those companies has a different business model and varying operations. Compare that exercise with the relative ease of the Fortune 500™ where the rankings are strictly based upon revenues. Understanding that, most sustainability professionals tend to take comparative rankings with a grain of salt, i.e. somewhat skeptically. From the internal standpoint, we are pleased to be high up on the list again, pleased to have an external evaluation of our sustainability programs and we will hopefully use the scores to identify future opportunities for improvement.

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