Asia-Pacific is home to the second largest number of public companies that rank top among their industry peers in terms of sustainability performance, a new annual report said.
The Sustainability Yearbook 2015, published by RobecoSAM, included 99 companies from Asia, second only to Europe, which had 211. The report by the Dutch asset manager’s sustainable investing subsidiary only included firms that place in the top 15% of their respective industry in terms of their sustainability efforts.
Furthermore, the study awarded each listed company gold, silver, or bronze status depending on the scale and effectiveness of its Environmental, Social and Governance (ESG) programmes. In Asia-Pacific, 16 companies were awarded gold medals, behind Europe with 33. Companies whose score is within 1% of the industry leader’s score receive this gold medal status.
At seven, Korea had the most gold ranked companies in Asia, including Hyundai Engineering and Samsung Electro-Mechanics, followed by Japan and Australia.
Other key findings from the report included that 35% of companies in Asia-Pacific addressed their material sustainability issues in their respective corporate sustainability reports, while 3% noted sustainability considerations in their annual report.
According to the RobecoSAM report, companies in Asia-Pacific recorded the lowest average criterion score in terms of tax transparency, partly due to the lower scores for Japanese companies. Companies in Australia performed almost as well as the ones based in Europe in this regard, the report showed.
“More aggressive tax planning from multinational companies over the past decade has become a growing risk for investors. Such a risk should be incorporated in company valuation,” wrote Matthias Müller, senior sustainability investing analyst, RobecoSAM. “But because transparency about where companies pay their taxes remains low, it is difficult for investors to assess the risks associated with companies’ tax practices.”
