This is part of our exclusive investigation into the gulf between consumer perceptions of corporate eco-credentials and the reality. We teamed up with two companies that have collected the most relevant data. Earthsense, based in Syracuse, New York, has polled US consumers on their perceptions of the 鈥済reenness鈥� of various companies. Trucost, headquartered in London, has compiled an unparalleled quantitative assessment of companies鈥� global environmental impact.
Our partners
When 快猫短视频 decided to investigate the relationship between corporate green performance and reputations, Earthsense and Trucost were the obvious partners.
has created the largest US market-research database of consumer attitudes and behaviours towards the environment and sustainability, while has compiled a comprehensive quantitative assessment of companies鈥� global environmental impacts.
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Earthsense scores
In May 2008, Earthsense conducted the second wave of its Eco-Insights survey with a nationally representative sample of 30,000 US adults. As part of this online survey, individual respondents were asked about a randomly-assigned sample of up to 20 from a total of .
Participants were first asked if they were familiar with each firm, if necessary being prompted with some examples of its brands.
Only if they were familiar with a company were survey participants asked to rate the firm鈥檚 environmental credentials. This gave an average of 1648 respondents per company included in 快猫短视频鈥榮 analysis, which drew on the answers to two questions:
1) Sustainable business practices allow companies to 鈥渕ake green by going green,鈥� by taking the environment into account in how they run their business. For example: using renewable energy in manufacturing, recycling raw materials, reducing packaging, etc.
When thinking about these companies, how much do you think sustainability is an important part of how they do business? Please rate them on a scale of 鈥�1鈥� to 鈥�10鈥� where a 鈥�1鈥� means you think they don鈥檛 consider the environment in any meaningful way in their business, and a 鈥�10鈥� means you think the environment is a core part of their business approach.
2) Products have different impacts on the environment 鈥� how they are made, what they鈥檙e made from, and how they are packaged and distributed. Thinking about these companies鈥� products, what DIRECT IMPACT on the environment do you think the main products they make or distribute have? Please rate them on a scale of 鈥�1鈥� to 鈥�10鈥�: a 鈥�1鈥� means you think the company鈥檚 products are having a very negative impact on the environment, and a 鈥�10鈥� means they don鈥檛 damage or even have a positive impact on the environment.
For our analysis, we combined the scores from both questions into a single average for each company.
Trucost scores
Trucost鈥檚 assessment of corporate environmental performance accounts for more than 700 different environmental impacts, including greenhouse gas emissions, water use, and a wide range of chemical releases. Its analysts use models based on all of a company鈥檚 activities, and the materials and processes involved, incorporating official sources of data such as the US Environmental Protection Agency鈥檚 , and companies鈥� own environmental data when these are disclosed. Trucost also works with firms to refine the results, to ensure as accurate a profile of their impacts as possible.
Trucost then converts each impact into an annual dollar cost. In the case of a firm running a fleet of diesel vehicles in its distribution chain, for example, these costs could include the burden of treating people with lung disease caused by emitted soot particles, plus the price of greenhouse gas emissions on a carbon-trading market. To assign these costs, Trucost relies on a library of prices derived from the latest academic research, updated with the help of an of leading environmental economists.
Finally, Trucost divides the cost of all the impacts by the company鈥檚 annual revenue to produce an overall environmental impact ratio, expressed as a percentage. For extremely polluting companies, such as those running coal-fired power plants, these ratios can exceed 100 per cent. The ratios for companies in 快猫短视频鈥榮 analysis ranged between 0.47 per cent and 52.60 per cent.
Each company鈥檚 supply chain is included in Trucost鈥檚 analysis 鈥� so that a restaurant chain鈥檚 score, for instance, incorporates the environmental cost of producing and distributing the food and beverages sold.
However, Trucost鈥檚 scores do not include impacts after the sale of a company鈥檚 products or services. In many cases, these post-sale impacts will represent only a small proportion of a firm鈥檚 total environmental footprint. But for our analysis, it risked skewing the results for oil companies and vehicle manufacturers, where consumer perceptions are likely to be dominated by burning the fuel, or running the cars 鈥� measures that Trucost does not include. For this reason, we analysed oil and car companies separately.
More details on Trucost鈥檚 methods are available .
Selection of companies
To define our sample of companies for analysis, we started with the entire list of companies in the Earthsense survey and looked for matches in Trucost鈥檚 database. This narrowed down the sample considerably, as most privately-held companies, and those that are subsidiaries of larger corporations, are not assessed by Trucost.
We also removed a small number of companies for which we were concerned that the brands described in the Earthsense survey may not have given a representative illustration of those produced by the matching company in the Trucost database, and which a typical consumer might encounter.
This gave a total of 143 companies, 28 of which were oil producers or vehicle manufacturers. The sample in our main analysis, therefore, contained 115 firms.
Wherever possible, we used Trucost data for 2008. However, for nine companies (Anheuser-Busch, Borders, Dollar General, Ford, Jones Apparel, Liz Claiborne, Lukoil, Panera Bread Company and Timberland) the 2008 data were either not available, or did not reflect the entity that existed when the Earthsense survey was conducted due to mergers, acquisitions or divestments. In these cases, we used Trucost data from 2007.
To assign companies to business sectors, we used their 鈥淪uper Sector鈥� listings in the system run by Dow Jones Indexes and FTSE, established as a global standard for grouping companies with similar activities.
A document containing the data used for our analysis is available for download.
Statistical analysis
To examine the relationship between Earthsense and Trucost scores, overall and within business sectors, we used .
There was no significant correlation across our main sample of 115 companies. However, there was a correlation across the 28 Oil & Cars and Automotive & Parts companies, significant at P