Methodology

The “Green Business CEO Rating” assesses the social and environmental impact of large Swiss companies and their CEOs.

The “Green Business CEO Rating” analyses both the CEOs and the companies of the SMI Expanded and the largest Swiss employers. It was published in the business magazines BILANZ and PME in July 2021.

The rating assesses sustainability risk management as well as the positive impact of CEOs and companies on the environment and society.

Previous CEO ratings from other sources are based exclusively on company performance and are therefore actually company ratings. The “Green Business CEO Rating” now shows that a social orientation of companies is to a large extent the responsibility of the CEO. The mindset of the leader is crucial for the priorities of the company.

This approach is the first of its kind in the world and unique in its depth and informative value. The underlying methodology was developed on behalf of “Green Business Switzerland” by the “Institute for Business Sustainability” (IBS) in cooperation with the sponsors and the business community.

The script: How the top CEO is determined

56 large companies from the SMI Expanded and the largest Swiss employers were examined. They were subjected to a three-stage analysis.

STEP 1: Business Valuation

The companies were rated using the following data from rating agencies. The company rating is based exclusively on this data.

ESG perspective – traditional CSR activities of a company:

The ESG best practices data of the rating agency ISS focus on the classic ESG criteria (environmental, social, responsible corporate governance) and are based on a risk perspective of sustainability.

Sustainability management as risk management focuses on reducing costs and risks for the company and expressing the perception of social responsibility (inside-out perspective). The results mostly consist of reductions in the negative impacts of the company (CO2 burdens, resource consumption, waste, emissions), but not in positive contributions to solving the societal sustainability challenges.

SDG impact – future-oriented “positive impact” perspective:

The SDG analytics data of the rating agency Standard & Poor’s (S& P)/Trucost analyses the positive and negative impact of each company with regard to all 17 SDGs (Sustainable Development Goals of the UN). The focus is on the view from society to the company and from the future to the present. This outside-in perspective is oriented towards the impact of the company and the social orientation of its products and services.

Both sets of data were equally weighted in the company evaluation. Of the total of 56 companies, 32 were analysed at the next level in terms of the performance of their CEO.

Background information on business valuation can be found at our science partner.

STEP 2: CEO Assessment

The CEOs of the 32 top-rated companies from the company rating were assessed using two equally weighted procedures.

Competency test – Inside-out: 85% of CEOs completed a scientifically validated competency test on responsible leadership (Competency Assessment for Responsible Leadership: CARL).

Expert evaluation – Outside-in: 50 sustainability experts evaluated the best CEOs by means of a standardised questionnaire with regard to their sustainability impact and their credibility as sustainability pioneers.

The sustainability experts are members of öbu, the UN Global Compact Network Switzerland (GCNS) and graduates/lecturers of the Diploma in Advanced Sustainability.

The questions concerned the CEO’s role model function (personal commitment and sustainability values), social impact (purpose and proof of impact), internal implementation (incentive and management systems as well as stability), external engagement (cooperation with civil society) and a final question on the CEO’s credibility.

The results of the company rating (weighting: 66 %) and the CEO rating (weighting: 33 %) were added up to an overall score. The ten best CEOs and their companies were presented to the jury for final validation.

STEP 3: Jury Decision

The high-calibre jury reviewed and validated the available data, decided on any exclusion criteria and defined the final CEO ranking (rank 1-5) as well as the other top-rated CEOs (TOP-10).

Jury members resigned in the event of conflicts of interest.