A Link Between Stock Exchange Membership and CSR Performance
By Bahar Gidwani
CSRHub recently examined corporate social responsibility (CSR) and sustainability rating data for the 18,991 companies in fourteen major stock exchanges. Despite the fact that CSRHub includes 64 million pieces of data from more than 380 sources, there is enough data to rate only 17% of the companies on these exchanges. For some exchanges, only 1% of their companies could be rated. The NASDAQ had the highest percentage of rated companies, with data available on 57% of its companies.
The average perceived sustainability performance of the companies varied, across the fourteen exchanges. Companies on exchanges that require sustainability reporting had higher average ratings than those that did not. We expect sustainability reporting to increase dramatically over the next few years in all parts of the world, as both exchanges and exchange regulators mandate more disclosure of material non-financial information. Even without mandated disclosure, we should be able soon to assess the sustainability performance of most public companies, just as we currently measure their credit score or brand value.
CSRHub measures twelve different areas of sustainability performance across four main categories of interest: community, employee, environment and governance issues. There is enough data to fully measure the performance of 2,427 of the companies we studied—13% of the total. We used this data to give an overview of the performance of the companies by exchange, as compared to all 9,300 companies we track.
To see the full discussion including variations in coverage, the current and future international reporting requirements and future implications, download a full report here.
Bahar Gidwani has built and run large technology-based businesses for many years. Bahar holds a CFA, worked on Wall Street with Kidder, Peabody, and with McKinsey & Co. Bahar has consulted to a number of major companies and currently serves on the board of several software and Web companies. He has an MBA from Harvard Business School and an undergraduate degree in physics and astronomy. Bahar is a member of the SASB Advisory Board. He plays bridge, races sailboats, and is based in New York City.
CSRHub provides access to corporate social responsibility and sustainability ratings and information on 14,400+ companies from 135 industries in 127 countries. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices and seek ways to change the world.