Which companies have come out to the top as the most sustainable? Here is the list.
Nvidia
Cisco Systems Inc
HP Inc
Autodesk
Verizon Communications
VF Corporation
Microsoft
McCormick & Company
Top sustainable companies in the US in 2022
1. Nvidia
Nvidia is one of the world’s largest manufacturers of semiconductor chips. It is one of the world’s leading designers of graphics processing units (GPUs) and system on chip units (SOCs) for the gaming, mobile, and automotive industries. As a manufacturer of chips, and at that scale, Nvidia has a massive carbon footprint. It mines materials, its factories and labs are power-hungry and consume a lot of water. However, Nvidia is renowned for its sustainability practices, operating at power efficiencies as high as 35%. By 2025, it has pledged to increase its renewable energy usage to 65%. The manufacturer is also 100% Responsible Minerals Assurance Process-compliant. Besides environmental stewardship, it is also renowned for its generous medical plan and paid parental leave policy.
By 2025, it has pledged to increase its renewable energy usage to 65%.
2. Cisco Systems Inc
Cisco is one of the world’s leading developers and manufacturers of networking hardware, software, and telecommunication equipment. It is also one of the world’s most sustainable organizations. It is remarkably energy-efficient across its supply chain, from sourcing materials, designing products, and consuming electricity to promoting fair hiring and securing data. Cisco claims that 80% of its electricity (operations only) is clean. It has also reduced its Scope 1 and Scope 2 emissions by nearly 50%. (Scope 1 refers to emissions generated by direct, owned sources like company vehicles. Scope 2 refers to indirect sources like cooling or heating systems. While Scope 3 emissions are caused by the remaining aspects in the value chain like employee commute and waste management.)
3. HP Inc
Hewlett-Packard is one of the world’s most prominent information technology hardware and services manufacturers. HP is most renowned for its computers and laptops. After all, between 2007 and 2013, HP was the world’s leading manufacturer of personal computers. But the IT giant also produces printers, scanners, cameras, servers, and calculators. Across its long and complicated value chain involving various materials, HP has managed to keep over 1.7 million pounds of plastic out of the ocean and recycle over 875 million ink cartridges. In fact, HP is the world’s number one recycler of printer supply. By 2025, it has pledged to reduce single-use plastic in packaging by 78%. It also collaborates with non-profit organizations worldwide, supporting healthcare, sanitation, and water management projects.
4. Autodesk
Autodesk creates software for the engineering, construction, architecture, education, manufacturing, and entertainment industries. The leader in 3D design uses highly efficient data centers and creates cloud computing software that enables companies to share data and collaborate seamlessly. Additionally, half of its directors are women, while stock has been granted to everyone in the company.
5. Verizon Communications
Verizon Communications or, simply, Verizon, is a leading provider of communication, entertainment, and information products and services. Verizon, like Cisco, is taking giant strides in its sustainability actions. By 2025, it has committed to generating 50% of its electricity from renewable sources. And by 2035, Verizon has committed to becoming carbon-neutral in Scope 1 and Scope 2 emissions. The company also funds projects in education and communication, supporting underserved communities by providing them free tablets and wireless access.
Cisco claims that 80% of its electricity (operations only) is clean. It has also reduced its Scope 1 and Scope 2 emissions by nearly 50%.
6. VF Corporation
VF Corporation is one of the world’s leading apparel, footwear, and accessories companies. VF has committed to shifting entirely to renewables by 2025, operationally. Further, it will decarbonize throughout by 2030. VF has also committed to using only regenerative, recycled, and responsibly sourced materials by the same year. Packaging, too, will be sustainable, with a focus on plant-based materials.
7. Microsoft
Microsoft is one of the world’s most valuable companies. It is the maker of Windows—the world’s most used operating system, by far and wide. But besides utterly dominating the PC software market, Microsoft also designs software for servers and manufactures its own computers. It has heavily invested in cloud computing and AI. Knowing full well the extent of its footprint, Microsoft has already achieved operational carbon neutrality.
Now, it has committed to achieving carbon neutrality across its chain by 2030 and, incredibly, by 2050, offset emissions generated since its inception in 1975. Besides environmental stewardship, Microsoft is transparent, offers generous stock plans, childcare policies, and even tuition assistance. A big player in AI, it heavily invests in research, especially ethics in AI.
McCormick & Company is a global leader in manufacturing, marketing, and distributing seasonings and spices. A food company, McCormick’s value chain extends to various parts of the world. It sources over 3000 products from over 80 countries. Despite a value chain so complex, McCormick has done remarkably well in sustainability efforts. The food industry has always been infamous for exploitation. McCormick, however, has partnered with organizations like the World Wildlife Fund, the Rainforest Alliance, and the Sustainable Trade to support poor communities, empower women, and help eradicate exploitation.
The ESG landscape in 2022
A private company has several goals. But all goals are achieved to fulfill one primary purpose: profitability. That is the only reason a company is established—to make money.
That is what we have always believed. Today, the reality is quite different. Earlier, a company’s sole focus was on creating value for shareholders. Today, the focus seems divided. Companies are now striving to create value for both shareholders and stakeholders—investors, customers, employees across the supply chain.
“Let us not forget that climate change is also linked to extreme weather events like the wildfires in Australia and Canada, which led to several hundred casualties.”
What changed? Well, the stakeholders themselves.
In the last five decades, evidence connecting human actions to climate change has increased in size and strength. The Intergovernmental Panel on Climate Change (IPCC), the UN’s leading authority on climate change, has put the certainty of the connection at 95%.
Private corporations are easily the biggest contributors to greenhouse emissions like carbon dioxide and methane. Forests are cut down to build factories, and those factories are powered by coal. This says nothing of the billions of gallons of water wasted or polluted annually. Or how acres of soil are affected by mining.
But today’s investors, customers, and even employees are having none of it. They wish to invest in, buy from, and work for companies that are accountable and refrain from exploiting the planet for profit. Let us not forget that climate change is also linked to extreme weather events like the wildfires in Australia and Canada, which led to several hundred casualties. And that harmful micro-plastics have infiltrated the air we breathe, the water we drink, and the food we eat.
That said, stakeholders demand accountability beyond energy usage. Stakeholders demand that companies are transparent and fair in their hiring. They expect that companies promote diversity and inclusion (D&I), create a culture that shuns discrimination, and offer equal opportunities regardless of gender and ethnicity. A culture that does society well, in a nutshell. Finally, stakeholders demand that companies be fair and ethical in their trade practices and not violate human rights.
Companies that comply with these demands are called ESG-compliant—they comply by the Environmental, Social, and Governance standards expected by their stakeholders. And since they do, they are likely to be more sustainable.
Such companies are perpetually innovating across their value chain, maximizing efficiency, if not replacing power sources with renewable energy altogether. The companies are more transparent, generous in leaves, and inclusive, hiring people from different communities. They comply with labor standards established in different nations, educate the underprivileged, and donate to non-profits.
As a result, they gain a high ESG score or rating. ESG consulting firms, like SG Analytics, analyze several hundred environmental, social, and governance factors to determine a rating that gives investors a measure of a company’s ESG performance. Higher ESG performance equals greater sustainability, which equals greater stakeholder value.
And that value is rapidly rising. It may even accelerate as the EU and US have committed more than $500 billion and $2 trillion, respectively, over the next ten years to fight and perhaps reverse climate change. In the United States alone, nearly a third of the total assets under management have been deemed sustainable by the US SIF.
If you are pro-sustainability, there is a lot to await in 2022.
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