McDonald's is greener than Whole Foods? (A second look at) Newsweek's 100 Greenest Companies

Last month, Newsweek published their “2010 Green Rankings,” a comparative assessment of how the world’s largest companies measure up in terms of environmental impact and commitment to sustainability-related policies. Here’s a quick look at what, the development of these sorts of sustainability metrics can tell us.

First of all, just to clarify, though the headlines read “Green Rankings: U.S. Companies,” and in some cases “Top-10 Greenest Companies” the ratings do not refer to the Greenest companies in the U.S., but rather, a ranking of the 500 largest publicly traded companies in the U.S. in terms of relative “greenness.” In other words, the “Top-10” is not the Top-10 greenest companies, but rather, the top-10 of the Fortune 500.

Development of a Sustainable Methodology

In order to develop a more sustainable means of measuring sustainability, Newsweek collaborated with MSCI ESG Research, Trucost, CorporateRegister.com, and ASAP Media to compare each company’s Environmental Impact (including GHG emissions, water use, and waste disposal), “Green Policies” (i.e. how the company manages carbon emissions, product life-cycles, local resources, and environmental risks, among other things), and each company’s reputation for greenness (or lack thereof.) While Newsweek does go to the trouble of explaining the relative percentages assigned to each factor when computing a company’s total “Green Score” weighted average, the Green Rankings team is less forthcoming about how the data was collected in the first place and what fact-checking was done to ensure credibility of company self-reporting efforts.

The Rankings

The Newsweek list certainly offers an interesting opportunity to compare select sustainability metrics across industry sectors: how does Exxon Mobile’s greenhouse gas emissions compare to Office Depot’s, for example. (In case you were wondering, Office Depot fares considerably better.) However, this flattening of the corporate playing field -- an emphasis on the functioning of the company rather than (in defiance of?) the product or service offered -- allows for some surprising (and seemingly paradoxical) results.

For example, Whole Foods Market, the yuppie grocery chain offering countless varieties of organic foods, ethical snacks, and cleaning products you can feel good about, ranked 93, which was significantly below McDonald’s. (The industrial food giant and infamous contributor to America’s obesity epidemic ranked 79). While Whole Foods boasts solid reputation points (76.25), it, reportedly, measures up relatively weak in the “environmental impact” department.

This, and other comparison facts are certainly interesting to peruse, but what is the take-away message of the Newsweek rankings? Are we to conclude that Whole Foods isn’t actually as green as its marketing campaign? Or that other companies’ greening (greenwashing?) policies are overshadowing unsustainable business models? Sure, selling organic rice cakes or free-range chicken does not impact Whole Foods’ company emissions policy, but shouldn’t their commitment to sustainably-produced merchandise (as opposed to Super-Size-Me fast food) count for something?