Half-empty or Half-full?

Last week, EMC was ranked as #74 out of 500 in the Newsweek Green Rankings.  I received quite a few congratulatory emails, as well as one or two from folks puzzled as to whether this result warranted celebration

To be honest, I'm not entirely sure what to make of it. I'm glad we're in the top 100, of course - plenty of people in EMC have been working hard and making progress, and the recognition is well-deserved. But we're not satisfied with what we've accomplished so far - nor should any of us on the list be.

Oh, I get that rankings create competition, and competition raises the bar. And I'm not so disingenuous as to claim that market perception doesn't influence our environmental programs. We also appreciate the press (see EMC Commended for Leadership in Climate Change Disclosure for Third Consecutive Year, for example).

But I do wish we had deeper insight into the ranking algorithms so we could understand what the raters (KLD Research, Trucost, and CorporateRegister.com) believe is most material to our business. We could compare it with the priorities we've set,  engage in discussions about why our priorities differ (if they do),  decide if they should be adjusted, and set expectations about how we might do in future iterations of the ranking.

Even more to the point, we need to remember that  - at least for most companies - these rankings are only indicators; they are not goals in and of themselves. Because at the end of the day, what's going to matter is how good a job the entire set of companies is doing as a group to transform to a low-carbon, cradle-to-cradle world. And the rankings don't tell us that.  Looking at economy-wide indicators are GHG emissions, waste production, and consumption of non-renewable resources, it's pretty clear we're not doing anywhere near enough. And it won't matter who's in the top 100 if we don't all make some pretty major changes to how we work and live.

So is the glass half-full or half-empty? As the joke goes, it's neither: it's twice as big as it needs to be. And we are all going to have to work to cut it in half.

Comments

[Kathrin]

Vijay,

No question that rankings provide a goal people can rally around, and set a competitive target that people could aim for. I hope I was clear that we're not immune to that at EMC, nor should we be. But wouldn't it be great if there were an absolute (and completely transparent) ranking, so that we could shoot not just for better than the other guy, but better than we were and closer to where we need to be?

It reminds me of my college days of grading on a curve. I argued then that if 50% of my class was high-achievers that met a set of high standards, we should all get A's. Instead, it was usually just 8%. It didn't seem fair to the 42% that were actually top notch but ended up with B's and C's, and were therefore arguably punished for having attended a school with a higher percentage of good students. Only in this case, I'm not there are many that deserve an A yet...

Kathrin

[Vijay Kanal]

Kathrin,

We are not fans of rankings either (despite pressure from some of our clients to rank them in a 26-company best practices study we did recently), but, rankings, ratings, qualitative assessments, etc. serve another purpose: they rally the troops (meaning employees) to do better. And even more importantly, they get the attention of senior execs (normally a type A bunch) who don't like to see their competitors ahead of them, on any list. So if it inspires companies to put more focus and resources on sustainability, we're all better off in the end.

Vijay

[Kathrin]

Eric,

It always comes back to that - that this is truly a system problem. Yet I struggle with how to convert that visceral sense into concrete prescription for metrics and actions. The complexity is so much greater that it can't be just be bottom up coordination of the system components; there has to be a radically new approach to the transforming the system as a whole.

I will weigh in on your post, too. I really like the idea of a longitudinal study!

K

[Eric McNulty]

Kate,
You have it exactly right. This is not a problem that one firm can solve nor one we should approach firm-by-firm. It is a system problem that requires the collaborative efforts of groups of companies. While anti-trust laws may prohibit some horizontal collaboration, vertical collaboration -- cradle-to-cradle -- is what we should be working towards. It would be interesting to see if Newsweek (or someone else) could develop metrics around that.

I authored a post on the methodology behind these rankings at http://iianalytics.com/2009/09/24/analytics-and-sustainability-part-ii/ in hopes of engaging those who hone algorithms for a living. Dive into that conversation if you'd like.