[Cross-posted from the Accountable Strategies blog]
In other words, do companies exist just to satisfy their shareholders' interests, or are there other stakeholders involved here, such as consumers, workers, the environment?
I noted, in fact, that those additional societal dimensions are taken into account in the annual Corporate Responsibility Index, which is compiled by a nonprofit, UK-based organization called Business in the Community. The 2006 CR Index was published by The London Sunday Times earlier this month. The Index ranks the 100 most “responsible” companies in Britain based on measures of environmental and social impact. The ranking process is a rigorous one that requires companies to fill out a survey that takes up to two months to complete, and requires site visits to the firms and internal auditing.
Last year, I asked The Boston Globe about their business ranking criteria, and Caleb Solomon, The Globe’s business editor then in charge of The Globe 100 responded by saying that “augmenting our coverage with some social meaures is something we're looking at.”
Well, The Globe has just published its 2008 edition of the Globe 100, bound in a sleek magazine edition to mark the 20th anniversary of the business rankings. They must still be looking at augmenting their coverage with some social measures because their criteria this year for selecting their 100 “best” companies haven't changed. The ranking is based on the same financial measures as it was the year before and the year before that.
The Globe's current ranking notes that five Massachusetts companies have made the 100 list in the past 20 years. They are the financial firms of Eaton Vance Corp and State Street Corp; defense contractor Raytheon Co.; retailer TJX Cos.; and the uniform-service company UniFirst Corp. Granted, these are probably great companies to own stock in right now. But are they the best companies from a societal point of view? Are there not other Massachusetts companies out there that may not be posting as high a return on equity as these five perennial makers of the Globe 100, but that might be doing more for their workers, consumers, their immediate neighbors, and the environment?
We won't know the answer to that because The Globe isn't yet interested in those additional measures. IMHO, our Massachusetts' major newspaper of record is behind the Times on this one.
