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    2 - Scoring Methodology
    • 11 Apr 2022
    • 9 Minutes to read
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    Contents

    2 - Scoring Methodology

    • Updated on 11 Apr 2022
    • 9 Minutes to read
    • Print
    • PDF
    Article Summary

    Scoring is the fundamental tool that is used to measure Corporate benchmarks, assessments, indexes, ratings and rankings. In this article, we will see the scoring methodology of 5 initiatives

    100 Best Corporate Citizens

    Introduction

    100 Best Corporate Citizens ranks the 1,000 largest, publicly traded U.S. companies on environmental, social and governance (ESG) transparency and performance. This document outlines the 2022 methodology set by 3BL Media, including changes from 2021, all factors used to determine the ranking and how the ranking is processed.

    Companies are assessed for 100 Best Corporate Citizens based on their ESG transparency and performance, researched from only publicly available information. There is no survey or questionnaire, and no cost or fee to be researched and ranked. 3BL Media’s partner, ISS ESG, conducts the research and processes the ranking.


    Pillars and Weighting

    PillarPillar WeightNumber Of Factors
    Employers20.5%36
    Climate Changes20.0%24
    Environment18.0%27
    Stakeholders & Society13.0%16
    Human Rights11.0%19
    Governance7.5%21
    ESG Performance5.5%02
    Financial4.5%10
    Total100%155

    Calculating the rankings

    CategoryNameDescription
    Three Types of Factors DisclosureDoes the company's climate change disclosure specifically address climate change risks?
    PolicyDoes the company indicate it applies the same human rights policy standards to suppliers and vendors?
    PerformanceDoes the company's climate change disclosure specifically address climate change performance?
    Three Forms of Data and Information Binary‘True’ counts as a positive value ‘False’ and ‘Blank / Not Provided’ counts as neutral weight
    NumericNumeric values compare to all other company numeric values to generate a ranking ‘Blank / Not Provided’ rank worse than the worst numerical respondent in any factor
    Qualitative‘Full credit’ for robust disclosures ‘Partial credit’ for insufficient disclosures ‘Blank / Not Provided’ rank worse than the worst partial credit respondent

    Processing The Ranking

    1. Weight each individual factor within a pillar. Some factors have higher relative weights. 3BL Media does not disclose individual factor weights so the ranking can’t be replicated 
    2. Calculate the underlying score for each pillar, then rank the full Russell 1000 within that pillar in ascending order (1 is the best rank).
    3. Apply the pillar weightings to generate an overall weighted average ranking for each company. The higher the weighted average, the better a company’s ranking. 
    4. Tie-Gaps: When several company scores tie, there is a gap between that score and the next closest score. For example, if two companies tie for the top rank, the company or companies that earned a second-place rank will place third. Second place is sacrificed for the tie-gap, so third is the next available rank after the tie-gap. 
    5. The controversy screen is applied. If ISS ESG identifies a Severe or Very Severe controversy, the company is penalized 10 points on its final, overall weighted score. Controversies and subsequent penalties are not publicly disclosed in the ranking.
    6. The lobbying screen is applied. Our partners at InfluenceMap (https://influencemap.org/) will measure the intensity of company lobbying and whether this lobbying is supportive or oppositional to Paris Climate Agreement-aligned policy benchmarks. 

    The 2021 World’s Most Ethical Companies® Honoree List

    Introduction
    In 2021, 135 companies are recognized for their unwavering commitment to business integrity. The honorees span 22 countries and 47 industries and include 9 first-time honorees and six companies that have been named to the list every year since its inception. At the heart of the evaluation and selection process for the World’s Most Ethical Companies is Ethisphere’s proprietary rating system, the corporate Ethics Quotient (EQ). The EQ framework features more than 200 multiple-choice and text questions that capture a company’s performance in an objective, consistent, and standardized way.

    All applicants will receive their overall EQ score and scores in all five categories as compared against the 2022 honorees.

    CategoriesSub-categoriesWeight
    GovernanceOversight15%
    Governance Principles
    Risk Management
    Ethics & Compliance ProgramProgram structure, responsibility, and resources35%
    Program oversight and tone at the top
    Written standards, training, and communication
    Detection, monitoring, auditing, and risk assessments
    Enforcement and discipline
    Leadership & ReputationLegal compliance and ethical track record10%
    Ethical reputation and marketplace
    Awards and accolades garnered
    Examples of leadership locally, nationally, and globally

    Environmental & Societal Impact    		Sustainability, citizenship and social responsibility20%
    Environment stewardship
    Community Involvement
    Corporate Involvement
    Corporate Philanthropy
    Workplace Impact and well-being
    Supply chain engagement and oversight
    Culture of EthicsEfforts to establish an ethical tone from top to middle20%
    Frequency with which culture is elevated
    Methods and outcomes

    Ethisphere’s proprietary Ethics Quotient®, the World’s Most Ethical Companies assessment process includes more than 200 multiple-choice and free-form questions on ethical culture, environmental and social practices, ethics and compliance activities, governance, leadership, diversity, and initiatives to support a strong value chain. Each section, question, and answer choice is individually weighted. Certain sections carry more importance than others, as do certain questions

    Fashion Transparency Index 2021

    Introduction

    250 of the world’s largest fashion brands and retailers were reviewed and ranked according to what information they disclose about their social and environmental policies, practices and impacts, in their operations and supply chain.

    The Index is a tool to push and incentivise the world’s largest fashion brands to be more transparent about their social and environmental efforts. Fashion Revolution believes that transparency is foundational to achieving systemic change in the global fashion industry, which is why we have been campaigning for it since 2014, and why we created this Index.

    What it does measure?

    The Fashion Transparency Index measures what brands know and publicly share about their human rights and environmental impacts across their value chains. Credit is only awarded to publicly disclosed information/data on major brands' policies, procedures, performance and progress on human rights and environmental issues across the value chain. We award points only for information/data that has been publicly disclosed on the brand or parent company's own website.

    Total Points
    The 2021 index covers 239 individual indicators and the total possible points are 250 (link in the References below)

    The weighting of the Scores

    SectionDescriptionsWeightingPoints
    Policy & CommitmentsThis section explores brands’ social and environmental policies for both their own employees and workers in the supply chain, how these policies are implemented, if brands have relevant goals and targets in place and if brands are reporting annual progress against these targets. For this year’s Index, available points in this section were halved to place more emphasis on outcomes and impacts13.2%33/250
    GovernanceHere we look at who on the executive board has responsibility for social and environmental performance, how this is implemented, how social and environmental improvements are linked to employee, CEO and supplier performance, and whether the relevant department can be easily contacted by the public. This year we also looked to see whether there is worker representation on the board5.2%13/250
    TraceabilityIn this section we expect brands to publish supplier lists at three levels: manufacturing, processing facilities and mills, and raw materials. We also look for extra details such as supplier address, number of workers, gender breakdown, number of migrant workers, union representation and when the list was last updated29.6%74/250
    Know, Show & FixHere we review what brands disclose about their due diligence processes, how they assess suppliers against their policies, what are the results of these audits and assessments, what brands do when problems are found, how workers can file complaints and how these are addressed18.8%47/250
    Spotlight issuesIn this final section, we have increased the weighting significantly compared to previous editions (up from 19.6% last year) in an effort to push harder for disclosure on the most urgent and difficult problems facing the industry. In this section we look at what brands disclose on a number of issues, including Covid-19 response, living wages, purchasing practices, unionisation, racial and gender equality, overproduction, waste and circularity, sustainable materials, water and chemicals, climate and deforestation33.2%83/250

    Timber Scorecard 2019

    Introduction
    The 2019 Timber Scorecard – the last in a three-part series – assesses businesses on their timber product sourcing policies and performance and assigns each a score from 0 Trees (no/limited evidence of policies in place) to 3 Trees (performing well against procurement policies). In doing so, the Scorecard aims to stimulate further transparency, inform consumers and support national and international commitments in the procurement of sustainably sourced timber products. It follows previous scorecards in 2015 and 2017, tracking the market’s progress towards sustainability by 2020. The 122 brands included in the 2019 Scorecard represent the public face of an industry and can therefore provide an insight into how a sector is performing overall.

    Through the 2019 Timber Scorecard, we also wanted to understand if and how companies are embedding sustainable sourcing policies within their environmental strategies. Doing this means the Scorecard would help measure the degree to which companies are making the link between sustainable sourcing issues and their environmental footprint. Recognising that direct and indirect environmental impacts are equally important is a key step towards effectively managing the footprint of an organisation

    Final Score
    3 Trees rating means the company did well while 0 Tree rating did bad

    Scoring System

    CategoryDescriptionAssessment metricWhat we look for
    Commitment and advocacyPoints were awarded for a robust Timber Procurement Policy and what it says – including commitments to the EU Timber Regulation – as well as awareness and actions on reducing the overall environmental footprint of the company’s activities...  (References - 10)Timber Procurement Policy5 Questions here
    Wider sustainability policy3 Questions here
    EUTR commitment1 Question here
    Does the TPP apply to goods not-for-resale?1 Question here
    Engagement with supply chain and customers2 Questions here
    Monitoring and performancePoints were awarded for the availability of annual performance statements (CSR/Sustainability Report or on a webpage) as well as the performance itself... (References - 10)Performance assessment4 Questions here
    Performance data2 Questions here
    Transparency In this section we assessed the availability and ease of finding the relevant information... (References - 10)Availability and ease of finding information3 Questions here

    Food Emissions 50 Company Benchmark

    Introduction
    The Food Emissions 50 Company Benchmark assesses the 50 largest North American food companies with exposure to the highest-emitting agricultural commodities on their performance in three categories: greenhouse gas emissions disclosures, reduction targets, and progress towards development and implementation of climate transition action plans. The benchmark is intended to guide investor engagements with companies along their food supply chains to drive timely and ambitious action on climate change.

    Companies were assessed on two indicators in 2021

    IndicatorsMetricsAssessment system
    Emission disclosure: To receive a "yes" verdict on this indicator, the company must receive a "yes" verdict on all three metrics.

    a: The company discloses scope 3 emissions from purchased goods and services.


    Each indicator was assessed as Yes / No / Partial, based on publicly available disclosures.

    Yes = When all metrics were Yes

    No = When all metrics were No

    Partial = When one metric for a sub-indicator or indicator was Yes

    b: The company discloses scope 3 emissions from agriculture.
    c: The company discloses scope 3 emissions from land-use change.
    Emission reduction targets: To receive a "yes" verdict on this indicator, the company must receive a "yes" verdict on the two metricsa: The company has an emission reduction target that includes scope 3 emissions.
    b: The company has an emission reduction target aligned with 1.5 degrees C that includes scope 3 emissions.
    Call To Action

    If you are a leader and are interested in joining our community. Join our LinkedIn Group Sustainability Research & Analysis Community

    References:

    1. Global Corporate Sustainability Benchmark | Assessment | Index | Rating | Ranking - https://73bit.com/MeasuringGlobalCorporateSustainability
    2. 100 Best Corporate Citizens - https://100best.3blmedia.com/
    3. 100 Best Corporate Citizens methodology - https://100best.3blmedia.com/wp-content/uploads/2021/12/3BL-Media-100-Best-Corporate-Citizens-2022-Methodology-FINAL-1.pdf
    4. The 2021 World’s Most Ethical Companies® Honoree List https://worldsmostethicalcompanies.com/honorees/
    5. The 2021 World's Most Ethical Companies Methodology -  https://worldsmostethicalcompanies.com/methodology/
    6. The 2021 World's Most Ethical Companies  FAQ - https://worldsmostethicalcompanies.com/faqs/
    7. Fashion Transparency Index 2021 - https://www.fashionrevolution.org/about/transparency/
    8. Fashion Transparency Index 2021 Methodology - Page 27-36 https://www.fashionrevolution.org/about/transparency/
    9. Fashion Transparency Index 2021 Questionnaire - https://docs.google.com/spreadsheets/d/1Cdf3beg8xusZIRsJRHMIpVYf8xoHbgl_/edit#gid=596406819
    10. WWF Timber Scorecard 2019 -  https://www.wwf.org.uk/timberscorecard
    11. WWF Timber Scorecard 2019 Methodology - Page 8 https://www.wwf.org.uk/sites/default/files/2019-07/TimberScorecard2019_FullReport.pdf
    12. Food Emissions 50 Company Benchmark - https://www.ceres.org/resources/reports/food-emissions-50-company-benchmark
    13. Food Emissions 50 Company Methodology - You have to download the report in an excel format and it has a tab in it. The link to download the report is available here https://www.ceres.org/resources/reports/food-emissions-50-company-benchmark
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