2007 World’s Most Ethical Companies
2007 RANKINGS
//Click image to enlarge
SPOTLIGHT ON SELECTED WINNERS
Perry Minnis is the Director of Global Ethics & Compliance for Alcoa, a metals and mining company with over 120,000 employees in 44 countries. Minnis, who started with Alcoa in finance 39 years ago, runs the Global Ethics & Compliance department to track metrics and determine if the company has a positive impact on the community. According to Minnis, “Our management has a very strong focus on safety. Alcoa is considered to be one of the safest corporations in the world.” The company’s Ethics and Compliance Council, which includes the CEO, vice presidents, and department directors, was formed in order to notify all executives of the latest in operations. The Council presents findings to the Board on a quarterly basis.
Minnis told us that Alcoa’s Code of Conduct has been condensed to apply to specific roles and translated into different languages in order to make it an effective tool for all employees. The Code is also provided to suppliers, so they understand Alcoa’s expectations and policies. “If a vendor’s values or policies differ drastically from Alcoa, chances are they won’t be doing business with us,” emphasizes Minnis. He continues, “The most important thing is our values. We have a set of values and policies that is consistent across the company, and we train all employees to adhere to and uphold those values.”
Sandy Cutler, CEO of Eaton Corporation, spoke in great detail about the basic beliefs that make Eaton a value-based company. These core values have allowed Eaton to maintain a strong foundation and sense of stability during recent internal changes and mergers. Rather than approaching ethics as a compliance issue, Cutler believes, “It’s about doing business right through internal philosophies and customer commitments. We’ll lose business before we will compromise our values.”
Eaton employs 61,000 people in 125 countries, and almost all of their products target helping people and companies effectively use energy. For example, Eaton developed a technology with the EPA for UPS, that allowed the shipping company to save 70% in fuel economy. Additionally, Eaton developed a hybrid electric bus technology for possible use during the Beijing Olympics.
Eaton places high value on contributions in the workplace and community, believing they are key components for doing business right. “People will work where the company and the community involvement values reflect their own,” insists Cutler. Every employee at Eaton has the opportunity to raise questions if they believe their personal morals are at risk. If a company is committed to doing business ethically, “you can cut the top off and the bottom would keep working,” maintains Cutler.
When we spoke to Knight Kiplinger about the company his grandfather started, his pride, dedication and passion was obvious. When Kiplinger speaks about the ethical culture of the company, he emphasizes that they “go the extra mile for their clients and their employees.” Founder W.M. Kiplinger, a social liberal and economic conservative of the 1920s, believed in communal capitalism within his company and shared his success with his employees by giving company stock to employees, among other great benefits.
Like many publishers today, Kiplinger is facing tougher times, but believes that “in the more difficult of times, the belt tightening should start at the top rather than at the bottom.” Setting the ethical tone at the top, Kiplinger maintains the idea that “we are all in this together” by freezing executive bonuses instead of cutting jobs. “It’s easy for a company to act generously and ethically during boon times. It’s when difficult times come that you see how a company truly is.”
Maintaining trust with non-employee family shareholders is also of great importance to Kiplinger. “Our company is a model of how to deal ethically with family members that don’t work in the business but have a stake within the business,” says Kiplinger. In the midst of maintaining company stability and sustainability, Kiplinger upholds its responsibility to its readers and will oftentimes reject ads that are of little or no value to its readers.
We spoke with Brackett Denniston, General Counsel for General Electric about creating an ethical culture and maintaining strong compliance programs. Denniston believes “a good company thinks about its human side,” and how people are impacted by business practices. To answer the needs of employees and communities, GE is active in organizations like NAFTA and the National Electrical Manufacturers Association, and is a founder of Transparency International, a global society that fights the impact of corruption on people worldwide. “You have to act like a leader, be a leader, and be aware of the impact of your actions and how they affect hundreds of thousands of people,” says Denniston.
GE dates back to 1892 and carefully considers the social impact of its products and operations on the communities in which it operates. From jet engines to household appliances and financial services to plastics, General Electric is dedicated to converting ideas into leading products to help solve the world’s challenges. Compliance and governance challenges are equally important to GE and remain non-negotiable aspects of operations. “A strong compliance practice begins with the basics of incorporating good citizenship into the company culture,” says Denniston.
When we spoke to Neil Nyberg, VP of Ethics & Compliance and Gary Pilnick, General Counsel for Kellogg’s, they declared,
“W.K. Kellogg believed in doing things the right way and built this company on integrity.” In business for 100 years, Kellogg’s has taken pride in its ethics and compliance program known as “K Values.” According to Pilnick, “It starts with the values, which guide behavior and ethical choices.”
Founder W.K. Kellogg wanted to do good things for people, starting with nutrition and the environment, and began promoting environmentally-friendly processes by producing the first boxes of cereal in recycled packaging in 1906. Today, Kellogg’s uses 100% recycled packaging. In addition, Kellogg’s created a Social Responsibility Committee in 1979 that now deals with environmental concerns, health & safety, addiction and abuse, and other issues that impact employees and communities.
According to Nyberg, culture and diversity truly matter. “We see ourselves as role models. Our commitment to ethics is absolutely non-negotiable.” Kellogg’s recently received an award from the National Association for the Advancement of Colored People for diversity in compliance and ethics. Kellogg’s is also the 2007 national sponsor for Race for the Cure, and has a comprehensive program for United Way’s Days of Caring, in which the entire company donates time. “You can tell in the eyes of the employees that it is a great reminder of what we have and how lucky we are,” says Nyberg.
In business for 170 years, John Deere prides itself on enabling “human flourishing.” With core values of integrity, quality, innovation and commitment, the company provides advanced products and services for agriculture, forestry, construction and landscaping, as well as manufacturing engines for use in heavy equipment. James R. Jenkins, Senior VP and General Counsel for Deere & Company, told us “John Deere fully recognizes the need to conduct business with integrity. Our broad approach to citizenship, coupled with market leadership, helps us improve the world while growing a business.”
Deere believes in creating and distributing service in ways that respect the earth’s limited resources while providing safe and healthy workplaces to help employees develop to their full potential. Deere continually reinforces its commitment to helping find policy solutions that benefit the environment. “We believe that effective policy to address global climate change must include development and support of renewable energy sources including agricultural, forestry, wind and bio-technologies, as well as processing and distribution improvements,” says Jenkins.
With a passionate commitment to doing what is right and operating ethically, John Deere makes their conduct guidelines transparent to employees, customers, and suppliers. Acting out of principled, long-term self-interest, Deere contributes to the greater good by supporting the quality of life in their communities, protecting the environment and preserving precious resources. According to Jenkins, “We believe that exceptional performance will not be sustainable if it is at the expense of our values.”
Print This Post
October 10th, 2007 at 11:21 pm
To me ethical is ethical if you are not ethical for all things then clearly you are not ethical. Looking at these comments it seem that this is a PR stunt that has no postion in ethics. Cant you here the expression of upset these comments pose. clearly your research is flawed.
September 24th, 2007 at 4:28 pm
Official Ethisphere Response to Mitch Gold:
The substance of your thinking about ethics is clearly faulty. Those identifying global standards to achieve Sustainability, and Corporate Social Responsibility encourage the use of Triple Bottom Line Accounting (as a minimum) and generally includes the aspects of the Four E’s = Economics, Energy (efficiency), Ethics (Equity), and Education. Your models do not consider the MDG’s, the UN Global Compact, or the Earth Charter as principled documents. Where is the ethics in that?
Mitch Gold, homeplanet.org
Ethisphere Response: In actuality, the WME CSR and Citizenship analysis does take into account Triple Bottom Line adoption, GRI Reporting Guidelines use, adherence to ISO14001, SA8000, involvement with the UN Global Compact, World Business Council for Sustainable Development and World Economic Forum. In fact, we go beyond memberships, certifications and the Davos speeches and look into a host of other criteria including environmental protection record, local community involvement, product innovation that contributes to public well-being, supplier diversity and supplier conduct, etc.
September 24th, 2007 at 4:26 pm
Official Ethisphere Response to Andrew Kay:
There’s clearly some limit on company size here (either a priori or as a result of the method used) — I find it hard to believe that there aren’t millions of tiny companies more ethical than all of these. Therefore it is important to know which companies were in the original 5000 and therefore deemed “less ethical,†rather than just “not considered.â€
Andrew Kay
Ethisphere Response: The issue with small companies is that many of them are private and therefore less visible or transparent. Many small companies were not considered for this reason, as we could not obtain adequate information about them to validate our methodology.
September 13th, 2007 at 4:46 pm
As an independent for Arbonne Int’l., I am disappointed our company did not make your list. Arbonne is an American-based skincare/health & wellness company owned by Harvest Partners, the same private-equity firm that owns Whole Foods, which, wonderfully, DID make your list. Arbonne is a 27-year-old company featuring Swiss-formulated products that have always been manufactured in Irvine, CA.
Our CEO, Bob Henry, who joined the company in 2004, won the Ernst & Young award “Entrepreneur of the Year” in 2005. Our president, Rita Davenport, who has been with Arbonne since 1990, is in the American Television Broadcasters Hall of Fame for her previous career as a television interviewer/personality in Phoenix.
The above attributes are all well and good, but the true beauty behind Arbonne is the great heart of this company. Yes, Arbonne is a Network Marketing company, much in the same vein as Avon or Amway, but I have come to find the company’s ongoing training programs, compensation plan, and bonus/rewards program are unparalled in this industry, possibly in ANY industry.
Just last February, Arbonne and its consultants raised $250K for Rita’s favorite charity, Sojourner House in Phoenix, a battered women’s shelter which offers both refuge and job training.
In today’s uncertain marketplace of dwindling 401Ks, non-existent pensions, and major downsizing, Arbonne offers people hope for their futures. Thousands of women and men have changed their lives for the better because of their affiliation with Arbonne. Those previously living paycheck to paycheck and/or drowning in debt, have realized financial freedom and greater financial security through Arbonne.
The compensation plan also includes a white Mercedes for those who reach the Regional Vice-President level. There are over 200 Arbonne white Mercedes in Oklahoma alone! Quite a nice trophy for hard work and determination.
To quote Rita Davenport: “Arbonne is a personal development company wrapped around a personal skincare, health & wellness company.”
All these perks would mean nothing, however, without Arbonne’s extreme integrity and ethical stance towards its product formulations. Our company motto “Pure. Safe. Beneficial.” could not be more accurate. You will find no animal by-products or mineral oil (a near-toxic preservative) in Arbonne’s products. All our products are based on botanical formulations. Arbonne has never tested on animals, even before it became cachet not to do so.
So, for next year’s “Most Ethical Companies” list, I feel strongly you should look into Arbonne. Not only do our products work (the anti-aging line is unparalled), but we are growing at the unheard of average rate of about 112% per year! And we’re doing it by leading the pack in sheer excellence in all your areas of criteria.
Note: I am not with the corporate office or some hired hand to promote Arbonne. I am simply an independent consultant who, like so many others, have hope again in my life because a complete stranger offered to share this wonderful company with me. That stranger is now my sponsor and together we will build a networking team that benefits everyone who grabs the “Gift of Arbonne” and runs with it.
Thank you for allowing my comments. For more info. on Arbonne, I suggest going to the website at http://www.arbonne.com. Click on the ‘Arbonne = REsults’ button to get a quick overview of the company: its products and its people.
Sincerely,
Shannon Mantrom
Independent Consultant
Plano, TX
(972) 693-0954
September 4th, 2007 at 8:39 am
I guess you feel “business as usual” , translate unethical practices now constitute fair corporate policy? I’ve personally worked for 2 of the above companies and believe me, their dirtier than the scum they suck on. Your list is as good as garbage and you obviously have been easily swayed to write this puff piece for the usual greasing the PR wheel. You make me sick. Especially for putting this an ‘ethical news’ website, to give it a semblance of dignity. Pathetic.
September 3rd, 2007 at 11:08 pm
Please check your facts before you write a comment. Wegmans has commented on its handling of the birds: http://www.wegmans.com/meb/columns/032605.asp. It sounds like they are willing to go the extra step to ensure reasonable handling of the birds.
Perhaps people should be also lobbying the federal government to have standards for how egg-laying hens are treated. According to http://www.indybay.org/newsitems/2006/05/05/18211371.php, there aren’t any, and Wegmans brought in an un-paid veterinarian as well as a paid expert professor from the University of California at Davis to receive advice.
Also, for instance, take a look at Wegmans Angus beef which has no hormones from birth, no antibiotics from birth, and environmentally friendly grazing. (http://www.wegmans.com/kitchen/ingredients/meat/byfga.asp).
August 30th, 2007 at 1:16 am
GE?? come on!! the most unethical company there is. Maybe not to the customers but surely to its channel partners.
August 9th, 2007 at 7:50 am
The substance of your thinking about ethics is clearly faulty. Those identifying global standards to achieve Sustainability, and Corporate Social Responsibility encourage the use of Triple Bottom Line Accounting (as a minimum) and generally includes the aspects of the FOur E’s = Economics, Energy (efficiency) Ethics (Equity), and (H)ealth. Your models do not consider the MDG’s, the UN GLobal COmpact, or the Earth Charter as principled documents. Where is the Ethics in that?
August 1st, 2007 at 5:56 pm
You’ve got Royal Dutch/Shell on your list??!! A company that got the Nigerian government to hang Ken Sarawiwa and seven other people for protesting what Royal Dutch/Shell was doing in Nigeria — especially to the indigenous Ogoni people (taking out oil and giving the people no compensation for it; polluting the entire Niger Delta, so the Ogoni couldn’t grow crops anymore; etc.) That, to you, is an ETHICAL COMPANY?! Are you completely out of your minds??!!
July 30th, 2007 at 4:37 pm
Who put this list together? Are you sure you are not missing an “un” in the title?
I mean, Nike?? Please.