Adidas, Burberry Among the World’s Most Sustainable Companies
Adidas just scored major bragging rights.
Not only did the sportswear giant make the Dow Jones Sustainability Indices (DJSI) for the 19th year in a row, but the annual ranking also named it an industry leader in the textiles, apparel and luxury goods sector.
Adidas outpaced rivals like Nike and Puma in criteria such as innovation management, supply chain management, human rights, environmental policy, operational eco-efficiency and social reporting, according to RobecoSAM, a Swiss sustainabilityinvestment firm that has worked with S&P Dow Jones Indices since 1999 to assess the 2,500 largest companies in Standard & Poor’s Global Broad Market Index based on their economic, environmental and social practices.
A sustainability leader, RobecoSAM noted, is one that integrates environmental considerations into a product’s entire life cycle, from design and materials sourcing to end-of-life management.
“Businesses not only engage with suppliers and subcontractors on sustainability issues, but also actively monitor various practices and disclose the results to stakeholders to protect their reputation and ultimately, their brand and company value,” it added.
Indeed, Adidas has fielded more kudos than brickbats of late. Together with Parley for the Oceans, it created the world’s first sneaker made from recycled ocean plastic. After graduating from a limited run of 50, it sold one million pairs of the shoes in 2017 and plans to sell another five million in 2018.
Its ongoing collaboration with Stella McCartney continues to earn plaudits for its use of lower-impact materials such as organic cotton and regenerated nylon. And in July, Adidas pledged to replace all virgin plastic in its products with 100 percent recycled polyesterby 2024.
But while the firm has reaffirmed its commitment to the Bangladesh Accord on Fire and Building Safety, labor-rights groups still criticize Adidas for paying “poverty wages” to the workers who sew its clothes and shoes.
The DJSI World Index includes other familiar names: Paris-based conglomerate Kering earned its fifth mention in as many years. Hugo Boss, which debuted on the list last year, returned for a second time. Burberry earned a spot for the fourth time, making it the world’s most sustainable luxury brand despite the recent brouhaha over burning unsold stock. (The British house has since repented, and it’s outlawed fur for good measure.)
Canada’s Gildan disappeared from DJSI’s World index after a five-year run, emerging instead on the geographically narrower North America index. Similarly, Japan-based Asics made the grade but only on the Asia Pacific index.
H&M’s absence from any of the indexes is also notable in light of its well-touted efforts to take sustainability mainstream. Although the Swedish retailer rated on the World index from 2012 to 2015, it has been M.I.A. since.
As the longest-running global sustainability benchmark, the DJSI has become a key reference for sustainability-focused investors, as well as a platform for promoting best practices in corporate governance, supply-chain standards and operational efficiency.
RobecoSAM uses a questionnaire-based methodology known as the Corporate Sustainability Assessment (CSA) to crunch together roughly 600 data points, derived from a series of industry-specific questions, into a Total Sustainability Score that ranges from 0 to 100. The leading 10 percent of scorers in each industry are included in the World Index.
CSA results are also used for the creation of the RobecoSAM Sustainability Yearbook, which the company dubs one of the most comprehensive annual publications on corporate sustainability.
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