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Being Ethical Has Its Perks: World's Most Ethical Companies

Feb. 26, 2019
Companies listed on the "World’s Most Ethical Companies" ranking outperform large-cap sector over five years by 14.4% and over three years by 10.5%.

What is the criteria for being an ethical company? And why is it important?

Ethisphere, which on Feb. 26 released the 2019 World’s Most Ethical Companies,  chooses companies that have met rigorous criteria across five categories covering the quality of their ethics and compliance program, organizational culture, corporate citizenship and responsibility, governance, and leadership and reputation. 

Making this list translates to improved financial performance. The group tracks how the stock prices of publicly traded honorees compare to the Large Cap Index and found that companies listed World’s Most Ethical Companies outperform large-cap sector over five years by 14.4% and over three years by 10.5%.

In addition to financial markets, other stakeholders view those on this list favorably. “Today employees, consumers and stakeholders value companies that show both a commitment to business integrity and also have the organizational humility to never stop seeking improvement,” said Ethisphere CEO, Timothy Erblich.

This year 128 honorees representing 21 countries and 50 industries have been named to the list which includes 16 first-time honorees and eight organizations that have been named to the list every year since 2007.

The thirteenth class of honorees is among the most sophisticated in cultivating a culture of integrity: measuring whether employees are comfortable speaking up, view leadership as trustworthy and take personal ownership in making sure the company is an ethical place to work.

“Responsibility has been a hallmark of IBM’s culture for 107 years – from our labs to our boardroom – and we’re honored to be recognized as one of the World’s Most Ethical Companies,” said IBM  CEO, Ginni Rometty. “We know our clients and the consumers they serve expect more than groundbreaking innovation and expertise. They want to work with a partner they trust, and one that works to make the world better, safer and smarter. We are deeply committed to these values.”

More than ever, the data from the process shows global companies stepping up to advance society and addressing issues like diversity and inclusion, supporting the rule of law, and advancing human rights.

“At the heart of Milliken is a set of strong beliefs about the way we conduct business ". explained Milliken & Company CEO, Halsey M. Cook. “ We know that ethical practices matter to our customers, our communities and our associates.

Conducting business in an ethical manner can be traced to innovation, according to Sony Corp. “At its core, Sony is committed to ethical and responsible business practices,” said Sony Corp.CEO, Kenichiro Yoshida. “Operating with integrity and sincerity is as central to the identity of Sony as is our groundbreaking spirit of innovation, which is why we are proud to be named as one of the 2019 World’s Most Ethical Companies.”

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