Frequently Asked Questions
The World’s Most Ethical Companies – Overview
Completing the World’s Most Ethical Companies process is considered to be extremely valuable by past participants, regardless of the recognition that may or may not come from it. The application process enables organizations to understand the elements of an effective program and to also compare their approach to leading practices. It also provides opportunities for ethics and compliance teams to collaborate with other key stakeholders across business functions and work together to answer certain questions.
Upon completing the process, applicants receive a scorecard which outlines their evaluation scores as they compare to honorees. Companies have found this information to be valuable for establishing priorities, celebrating their strengths, building a business case for additional budget, and focusing their teams. The scorecard also includes exclusive data and insights only available to applicants, and links to valuable, curated resources to help improve their programs.
In addition to the scorecard, applicants who are not members of Ethisphere’s Business Ethics Leadership Alliance (BELA) will receive a three-month Associate level membership, enabling participation in a member roundtable and providing access to the member hub featuring organization-contributed materials, and exclusive research, masterclasses, reports and more.
BELA is a community of global organizations that collaborate on best practices for ethics, compliance, and governance made up of more than 380 members and their teams.
Applicants who are BELA members also receive a scorecard with exclusive insights and data comparing their scores to those of honorees, along with a more in-depth benchmarking that provides further insights and guidance.
Applicants with exceptional program elements may also be selected to be featured in Ethisphere Magazine and other Ethisphere platforms, such as our Global Ethics Summit.
Whether an organization applies or not, a robust ethics and compliance program is good business. Our years of data shows that those with strong programs in place outperform, which we call the Ethics Premium. Investors understand this, and importantly, employees, customers and other stakeholders value working with organizations rooted in integrity.
The World’s Most Ethical Companies – Who Should Apply?
That said, the Ethics Quotient questionnaire and peer group is generally designed for those organizations with over $250 million in revenue. This does not mean that smaller organizations cannot benefit from the process or be designated as one of the World’s Most Ethical Companies, but rather that our process is not suitable for many smaller organizations unless they have the type of programs in place typically seen at larger organizations.
Please note that while our process has broad eligibility requirements, non-profit colleges and universities, governments, governmental agencies, government majority owned organizations, and NGOs are not eligible. If you have a question regarding eligibility, please contact Ethisphere at [email protected]
We encourage wide participation, regardless of whether an organization thinks that it will be honored. All organizations that submit a survey will receive an Analytical Scorecard that provides their overall Ethics Quotient and evaluates how their score in each of the five categories compares to those of honorees. The value in participating is not only in learning how one’s organization compares to the honorees, but also in better understanding what’s trending in leading organizations and more about their best practices.
Application Process – Ethics Quotient Survey
Ethisphere’s proprietary Ethics Quotient®, the World’s Most Ethical Companies assessment process includes more than 200 multiple-choice and free-form questions on ethical culture, environmental and social practices, ethics and compliance activities, governance, leadership, diversity, and initiatives to support a strong value chain.
Applicants are able to download the questionnaire in advance of entering details into the survey platform so that they can prepare responses and gather information from other sources within the organization.
The EQ questionnaire is jointly developed by our internal team of legal and compliance professionals, feedback provided by previous applicants, and our Methodology Advisory Panel. Advisory Panel members include leading experts from the fields of law, corporate reputation, corporate ethics, governance, and anti-corruption.
We review the questionnaire annually to ensure that it aligns with the ever-changing expectations of employees, managers, shareholders, regulators, and the public at large.
The first step is for an organization to complete the Ethics Quotient (EQ) questionnaire. This results in an objective self-reported EQ score. Companies then submit documentation that allows us to qualitatively evaluate aspects of an organization’s programs and processes.
Lastly, Ethisphere’s team of analysts researches each organization’s history of litigation, reputation, and ethical track record to inform the score for the organization’s Leadership and Reputation. The self-reported scores are combined with the qualitative assessment of an applicant organization’s supplemental documentation and independent research to produce a final EQ score.
Application Process – Reputation Evaluation
Our evaluation of an organization’s reputation looks carefully at the perception of the organization’s brand among stakeholders. We give an applicant credit for third-party recognitions indicating positive stakeholder perception. For example, we consider awards and accolades garnered as well as inclusion on indices related to governance, ethics and compliance, culture, environmental practices, citizenship, or social responsibility.
We off-set the credit given for third-party recognitions with any negative reputational issues faced by an applicant. Specifically, we conduct a review of publicly available information (e.g., public filings and the Dow Jones Factiva business information and research tool) to understand any negative perceptions caused by an applicant’s legal compliance, litigation, environmental, or other ethical issues. This review has a five-year look-back period.
Ethisphere bases its timing for the look-back period on the timing of an issue’s resolution. For example, if the conduct occurred in 2005, but the issue is settled in 2020, Ethisphere would consider the relevant timing to be 2020 for purposes of the five-year look-back period.
While evaluation of any particular issue is necessarily objective, Ethisphere considers the following factors in its evaluation: (i) how long-ago the conduct at issue occurred and when it was resolved, (ii) the seriousness of the conduct or issue, (iii) actions taken by the applicant to address the issue, and (iv) how the issue impacts the applicant’s reputation. If the issue is severe enough, it alone can exclude an organization from being included on the World’s Most Ethical Companies List. In such a case, we will fully score the applicant’s submission and provide the Analytical Scorecard and feedback. We will also inform the applicant that, regardless of its performance within our evaluation process, the reputational issue precludes it from being included as one of the World’s Most Ethical Companies.
Given the necessary subjectivity of this reputational evaluation, we are happy to answer any questions you may have at [email protected].
Application Process – Documentation
EQ scores are adjusted based on documentation review and independent research. Each candidate then receives a final score that may be higher or lower than the initial “self-reported” score. Note that if we are unable to evaluate certain aspects of performance (i.e., requested documentation is not submitted), the resulting scores may be discounted.
While Ethisphere will not contact an applicant except as specified above, new this year, each applicant will have a portal that will indicate whether documents have been received. Assuming an applicant submits documents as instructed, the portal will indicate whether documents have been received for each category.
Application Process – General Questions
The 2023 application process opens in August 2022, with all materials due in early November.
We do not disclose the names of organizations who are not honored, and no individual response is made public. Scores will only be used to calculate EQ scores and/or provide a report or analysis to an organization. We also use EQ scores and responses in an aggregated or anonymized fashion for benchmarking and research purposes.
Additionally, honorees may not publicly share or reference their organization’s scores or performance compared to the World’s Most Ethical Companies’ averages. Our purpose is to celebrate all of the organizations equally; accordingly, we very intentionally do not rank the organizations that make the list each year. Sharing information or referring to the scores necessarily leads to a comparison among the honoree organizations. Also, the selection process compares organizations to their peers. Without context, publicizing how an organization fares against the average scores misrepresents our process and could cause confusion.
Companies that submit the Ethics Quotient (EQ) survey and supporting documentation between between August 10th, 2022, and November 15th, 2022, are considered for inclusion in the World’s Most Ethical Companies recognition program for 2022. However, organizations that would like to participate in the EQ—with the opportunity to be benchmarked against honored organizations—may do so throughout the year, at any time.
Fees
About Ethisphere
No, the World’s Most Ethical Companies selection process is unbiased. As an ethics and compliance organization, we are very conscious of conflicts of interest and use our methodology to quantify recognition as much as possible. Organizations are honored for their programs, practices, policies, and reputations as measured by the Ethics Quotient methodology.
Our mission is to define and advance the standards of ethical business practices that fuel corporate character, marketplace trust, and business success. We have a deep expertise in measuring and defining core ethical standards using data-driven insights that help organizations enhance corporate character. We believe that this recognition program is important because corporate ethical standards must be set and measured and those who excel should be honored.
Ethisphere receives revenue from our membership group, a broad range of solutions and advisory services, licenses, conferences, and sponsorships. No organization that is honored with the World’s Most Ethical Companies designation is responsible for more than 1.05% of Ethisphere’s revenue. And no honoree may place advertising in the issue of Ethisphere Magazine that announces and highlights new honorees.
Honorees
In 2022, there are 136 honorees representing 22 countries and 45 industries. See 2022 honorees >