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The Global 100 progress report

In the face of rising emissions and grassroots protests, corporate climate action has never been more important

Sustainability is increasingly a mainstream business concern, with mounting pressure to tackle the climate crisis coming from the top down and the bottom up.

This past year saw the publication of two startling reports from the Intergovernmental Panel on Climate Change (IPCC), warning of the worsening impacts of climate change threatening food supplies, infrastructure and already fragile global water supplies. At the same time, the United Nations reported that the “emissions gap” – the gap between the greenhouse-gas (GHG) emissions that will limit temperature increases to the 1.5C that climate scientists say is safe and the GHGs that we are actually emitting – is growing.

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The Global 100 difference

The most sustainable corporations keep upping their clean revenue – and outperforming competitors

For many years, there was a consensus, among investors and the businesses they bought shares in, that companies should focus on maximizing shareholder returns above all else. Environmental, social and governance (ESG) issues were irrelevant to financial performance, it was agreed, and if you did consider them, you would damage your returns.

This consensus is starting to crumble as the evidence mounts that considering sustainability issues is not a drain on earnings – and, in fact, improves performance. “The impression among business leaders is that ESG just hasn’t gone mainstream in the investment community,” said the Harvard Business Review last year. “That perception is outdated.”

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Top company profile: Denmark’s Ørsted is 2020’s most sustainable corporation

Coal-turned-wind giant says "doing good and doing well must go together"

A decade ago, offshore wind power was one of the costliest forms of electricity generation in the world, and even its leading exponent was dominated by fossil fuels – right down to its name.

DONG (Danish Oil and Natural Gas) may have opened what was then the world’s largest offshore wind farm in 2009, but the company was also widely acknowledged – and considered itself – as one of the best developers of coal-fired power plants. Since then, it has undergone one of the business world’s most radical transformations and got itself a new name, Ørsted – after the Danish physicist Hans Christian Ørsted, who discovered electromagnetism in 1820.

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The Global 100 difference

Sustainable companies don't just make the world a better place, they offer higher returns and longer lifespans.

This year’s Global 100 ranking of the world’s most sustainable companies suggests that performing well on sustainability issues not only makes you more money, it helps you live longer, too—a rosier take on the cliché that nice guys finish last.

Analysis by Corporate Knights with Thomson Reuters Datastream shows that the average age of a Global 100 company is 87 years, while the average age of companies in the MSCI All Country World Index (ACWI) is 63 years.

And the Global 100 index, which is equally-weighted and mirrors the industry composition of the MSCI ACWI on a percentage basis, outperforms the benchmark, says Corporate Knights CEO and editor-in-chief Toby Heaps. “From inception (February 1, 2005) to December 31, 2018, the Global 100 made a net investment return of 127.35%, compared to 118.27% for the MSCI ACWI,” he points out.

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Global 100 progress report

Populist outrage and ecological limits have compelled corporations to step up to the plate

The global sustainability landscape has changed markedly in the past 12 months. Climate-skeptic leaders are in power in some of the world’s biggest-emitting countries, including the U.S., Brazil and Australia, and the International Energy Agency has pointed out that greenhouse gas emissions rose in 2018 after a five-year trend of reductions.

The #MeToo movement has shone a welcome spotlight on gender inequality (while highlighting how much work remains to be done). In Cape Town, the drought and resulting restrictions on water use provided a stark illustration of the growing scarcity of water and its consequences, while the surge in battery production has shone a spotlight on child labour and working conditions in the Democratic Republic of Congo.

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Top company: bacteria maker is most sustainable corporation of 2019

Denmark's Chr. Hansen is saving the world, one germ at a time

Bacteria may be the most successful life forms on earth, comprising more biomass than all other living things put together, but they seem an unlikely foundation for a sustainable business.

Yet a company whose products are all based on microbes has been named the most sustainable company in the world in Corporate Knights’ Global 100 ranking. Chr. Hansen is a Danish bioscience company that dates back 140 years and “develops natural solutions for the food, nutritional, pharmaceutical and agricultural industries,” the company says.

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Top company profile: Dassault Systèmes

Using software to design a more sustainable future

For most companies, sustainability is a journey. But it seems Dassault Systèmes, the top company in our 2018 Global 100 ranking (up from 11th last year), was on the road to sustainability from the moment it was created.

It just didn’t know it at the time.

Founded in 1981 as a spinoff from France’s Dassault Aviation, the company has always been focused on helping its customers to reduce waste and become more efficient. “We invented sustainable development before the term existed, even though it was not explicit in our purpose,” says Valerie Ferret, director of public affairs and sustainability. “At the time it was all about optimizing manufacturing processes.”

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