Stock Market Index Dow Jones has announced its 2022 Sustainability World Index, consisting of global sustainability leaders as identified by S&P Global through the Corporate Sustainability Assessment (CSA). It represents the top 10% of the largest 2,500 companies in the S&P Global BMI based on long-term economic, environmental and social criteria.
The purpose of the index is to steer investors toward more sustainable investments with confidence. This year, over 7,500 listed companies reported to the evaluation, and only the best in the respective industries qualified for the index.
The Dow Jones Sustainability Index (DJSI) was launched in 1999 with the aim of being the first series of global sustainability benchmarks available in the market. The index family consists of global, regional and country benchmarks.
The key factor for selecting companies for any DJSI index is a company’s S&P Global ESG Score, calculated under the S&P Global Corporate Sustainability Assessment (CSA).
This year’s edition lists a number of new additions and changes as documented below.
Castellum maintains an impressive rating
For the seventh consecutive year, property company Castellum has received top marks in the assessment and is the only Nordic company of its kind to be included in the index.
Its property portfolio covers locations across Sweden, Copenhagen, and Helsinki and is mainly composed of office blocks and public sector buildings.
“It is extremely gratifying to have placed so high in international rankings, but our focus is on future-proofing our own operation and continuing to promote the necessary climate transition,” says Rutger Arnhult, CEO of Castellum AB.
Santander up there with the best of the banks
Elsewhere, Santander ranked among the world’s most sustainable banks in the Index and among the top three in Europe. The bank scored 83 points out of 100, placing it in the 98th percentile of all banks reviewed. Santander has been featured on the Dow Jones Sustainability Index for the past 22 years.
The bank scored highly in every category: economic (86), environmental (76) and social (83). It also highlighted areas where the bank has improved, such as financial inclusion, environmental and social reporting, climate strategy, privacy protection and customer relationship management.
Santander ended the first half of the year, with over 2.4 billion euros in 33 funding transactions and a worldwide market share of 6.4%, according to Infralogic’s ranking. In the past decade, Santander has been a leading bank in renewable energy finance, ranking among the top three in the world in number of transactions and the top five in funding volume.
Earlier this year, the bank’s Polish arm was officially recognised for its high standard of ESG reporting and activities as part of a competition organised by the Responsible Business Forum and Deloitte.
Better representation for Asian companies
More businesses from China, India, Taiwan, and Thailand have been added to the Dow Jones Sustainability Indices this year.
The number of Asian firms in the emerging markets category of the index rose from 75 last year to 82 this year, out of about 110 companies in total, which also includes entities from Europe, Africa, and the Americas.
India
India’s Adani Enterprises has been added to the list, following the year-end review of the index. The company is the flagship of the Adani Group, a multinational conglomerate helmed by Gautam Adani, one of the world’s richest individuals It includes businesses in port management, electric power generation and transmission, renewable energy, mining, airport operations, natural gas, food processing, and infrastructure.
The billionaire leader has pledged billions in renewables and wants to make the world’s cheapest renewable hydrogen fuel, though his conglomerate has been criticised for its growing coal portfolio. Adani Ports, another entity under the Adani group, was struck off the Dow Jones Sustainability Index last year due to its business ties with Myanmar’s military, which is involved in a bloody takeover of its civil government.
Thailand
Thailand has one net addition to the index, with three additions and two boots – including the petroleum exploration arm of state-owned oil and gas firm PTT, though other branches of the group remain on the list.
“It is comforting that emerging Asian markets are making it into the Dow Jones Sustainability Index lists,” said Professor Lawrence Loh, director of the Centre for Governance and Sustainability at the National University of Singapore, adding that the trend “augurs well” given that there has always been a divide between the sustainability credentials of developed and emerging markets.
“It is sometimes said that emerging markets are both the problem and the solution in our global fight against climate change – perhaps we are seeing the trend of the solution rather than problem now,” Loh said.
Other highlights
Japan, the leading market in the Asia Pacific index, lost three spots overall, with 74 firms represented after the review. Australia gained one spot with 24 firms, while South Korea stayed constant at 33.
In total, over 3,500 of the world’s largest companies were invited to take part in a survey for the sustainability index, which includes questions on human rights, climate strategy and corporate governance. The firms’ economic performance is also considered.
Firms can be disqualified if they have dealings in, for instance, adult entertainment and arms sales; 16 companies have been excluded in the latest review. Trade or the use of fossil fuels is not an exclusion criterion.
