Date of Publication: April 7, 2021

Author: Rumina Dhalla & Felix Arndt

Summary:

Coca-Cola, Glencore (a european mining company), and British American Tobacco are ranked in the top five environmentally and socially responsible companies on the FTSE 100. This can appear as confusing as it makes consumers question how these companies are considered environementally responsible. The industry and demand for sustainable goods is increasing and many investors look at ESG information before making investment decisions. While this happens, there is also a rise in the number of companies entering these ESG rankings. Despite there being many of these ESG rankings, there is no consistency on the factors and criteria for these rankings. The lack of consistency in ESG standards has caused companies to be ranked as high- risk on one list and low-risk on another. This can make the reliability of sources questionable. Investors and consumers should seek out rankings which do not accept payment from companies so they are not able to influence their ranking on the list.

Link to Full Reading:

https://theconversation.com/sustainability-rankings-dont-always-identify-sustainable-companies-157023