Shell has come top of Business in the Environment’s (BiE) fifth annual Corporate Environmental Engagement Index.
The oil company, which has been under fire in the UK recently for the level of its profits, scored highest on a range of environmental engagement measures, putting it ahead of Scottish Power, British Energy, Severn Trent and J Sainsbury in descending order.
This year’s index, which measures company performance on factors such as energy consumption, waste and water pollution, showed a slight increase of average scores.
While companies in the utilities sector retain their position as leaders in the index, banks, insurance and life assurance companies have all made ‘significant’ progress and even the IT sector – traditionally slow on environmental performance – is showing signs of ‘limited progress’.
But the area causing most concern is reporting and target setting on global warming emissions, which BiE says is ‘disappointing’ across all sectors. Companies are not measuring the impact of their transport adequately and four out of five of the 184 index participants either set no emissions reduction targets at all or targets that were unspecified or ‘very low’.
More than one in four of the companies taking part (28 per cent) are failing to measure even their waste outputs.
BiE, which is a business-led campaign for corporate environmental responsibility, also says few companies were adequately addressing the environmental performance of their supply chains.
Highest new entrants to the index were UBS in 15th position and ABB in 22nd. Most improved in terms of their ranking were Invensys (64th), Rentokil Initial (87th), Anglo American (130th), AEA Technology (67th) and John Laing (114th). Companies invited to participate are current or former members of the FTSE 350, Business in the Community members and businesses that lead their industry sectors in the Dow Jones Sustainability Group Index.
The total market capitalisation of the companies taking part is $1,968billion (£1,360bn), or 78 per cent of the FTSE 350 by value. A total of 61 businesses participated for the first time this year.
The index shows that:
measurement of energy consumption was tackled best by participants, with 86 per cent of respondents reporting publicly and setting improvement targets
the most engaged sectors were water, electricity, gas distribution, tobacco, mining, oil and gas, with 100 per cent of companies participating in the index
the most improved sector participation in the index was in construction and building materials, which increased from 20 per cent to 68 per cent of companies eligible.
Last year Severn Trent headed the index, followed by BT, Cable & Wireless and Thames Water (EP11, 2000).
BiE has now set up a working group to propose a format for the survey that will make it easier to compare one year’s results against another.
It is also looking at proposals to broaden the scope of the survey ‘without losing the clarity of its approach’.