What is a beta launch, anyway? More than a sketch, more than a roadmap, something of a prototype?
We launched our Responsibility100 Index in beta last week in the Tortoise spirit of openness and of working together to get to a smarter answer.
The Index ranks the FTSE 100 companies to see how well they are living up to their social and environmental responsibilities by examining their record on the UN’s Sustainable Development Goals.
On the day we launched the first ranking, we also staged a ThinkIn to discuss the findings, the way they were put together, and the route to January when we will formally launch the Index.
It was great to hear some thoughtful encouragement, but more importantly, it was invaluable to identify a lot of work still to do.
- Measuring for individual performance, not industrial sector. If you are in an inherently environmentally damaging industry like mining or energy, but committed to the UN Sustainable Development Goals in word and deed, perhaps you should be able to outperform a tech or media company with a much smaller environmental footprint that’s doing little to improve the prospects for people or the planet.
- Monitoring investment in research and development. Businesses report retrospectively; we’re interested in their future intent. More granular analysis of investment in R&D is the best way of tracking the extent to which verbal commitments are matched by action.
- How do we account for fines? Regulators are slow and big companies which buy subsidiaries can find themselves paying for historic mistakes which they inherit. Companies often treat fines as the price of doing business, i.e. even if they dispute the wrongdoing, they pay up so they can keep operating in that market.
- Personal leadership. We can learn a lot about a company’s responsibility by learning what the CEO intends for the company.
- Government affairs. We have the data on the number of times companies meet government officials, even, briefly, what the meeting is about. But do we treat that as behind closed doors lobbying or responsible public policy engagement?
- Standardisation. The UN is said to be looking at how it can create measures that work not just for UK-listed companies but internationally, not just listed ones but private ones too. The sooner the better.
A dozen FTSE100 companies were represented in the room last week and 59 of them have engaged with us. Our job in the next three months is to work directly with them to get to a more informed position.