This year's "100 Best" list is led by Green Mountain Coffee Roasters of Waterbury, Vt., which was cited for its "meticulous attention to corporate social responsibility," including its pioneering work in the fair trade movement, which pays coffee growers stable, fair prices. Green Mountain has been among the top 10 companies on Business Ethics' list for four years running.
Now in its seventh year, the list for 2006 is striking because of the dominance of technology firms among the top 10. Hewlett-Packard is enjoying its seventh time in the top 10, while Advanced Micro Devices makes its first appearance on the list. Motorola is enjoying its third time in the top 10, and Agilent Technologies its second time.
Rounding out the top 10 this year are The Timberland Company, list newcomer Salesforce.com, Cisco Systems, Dell and Texas Instruments.
Why the strong showing by tech?
"Surprisingly, it's not due to financial out-performance," said Marjorie Kelly, editor of Business Ethics, "since none of the top tech companies ranked in the top 10 in financial returns."
Instead, Kelly noted, most top tech companies do well on environmental issues. They also tend to be active in their communities and score high in employee relations.
"These firms know that to attract and retain talent, it pays to be socially enlightened. High-tech seems to be a genuinely socially responsible sector," she said.
The list saw quite a bit of turnover from 2005, with 33 companies appearing for the first time. Newcomers Johnson & Johnson and McGraw-Hill Companies score particularly high in workforce diversity. Newcomer Milwaukee-based Johnson Controls rates high marks because of products that help conserve energy.
The 100 Best Corporate Citizens list puts a numerical rating on service to these various stakeholders. Environmental, social and governance ratings are drawn from SOCRATES, the online social research database created by KLD Research & Analytics Inc. in Boston, an independent research firm serving investment management professionals.
"KLD is proud to have powered the ratings for The 100 Best Corporate Citizens in each of the seven years since inception," says Peter Kinder, president of KLD. "Our quality is rooted in independent research and analysis of listed companies for environmental, social and governance factors. Clearly, The 100 Best Corporate Citizens demonstrates some perform better than others.
The universe of companies considered for the list encompasses U.S. firms in the Russell 1000, the S&P 500, and KLD's Domini 400 Social Index. These firms are ranked on their performance in eight stakeholder categories: shareholders, community, governance, diversity, employees, environment, human rights, and product. Social scores use KLD's assessment of "strengths" and "concerns" demonstrated in each category. The shareholder score is based on three-year average total return (stock appreciation plus dividends) through year-end 2005.
"Being a good corporate citizen requires focus, dedication, and hard work. The companies on our list are to be congratulated," said Michael Connor, publisher and executive editor of Business Ethics.
