Jan 29 2010

PG&E: The Sustainable Utility

Posted by: Jonathan Marshall

 Everyone knows that "sustainable" is good, but what exactly is it? Corporate Knights, a Canadian-based magazine for "clean capitalism," has come up with a comprehensive definition--and it announced yesterday that Pacific Gas and Electric Company ranks second on its Global 100 list of sustainable large companies, right behind GE.

Working with three strategic partners--Inflection Point Capital Management, Legg Mason's Global Currents Investment Management and Phoenix Global Advisors LLC--Corporate Knights came up with what they call the "international gold standard" for sutainability indexes. It summarizes 11 separate measures, including energy productivity (sales divided by energy consumption), water productivity, leadership diversity, R&D intensity and transparency.

Announcing the magazine's findings at Davos World Economic Forum, editor-in-chief Toby Heaps said that to be considered sustainable, companies must "squeeze four times more wealth out of every resource they use."

Heaps explained the significance of the new global ranking: “By using clear metrics to show investors which companies stand out from their peers, we hope to create a virtuous cycle where the most sustainable companies attract the most capital and earn the best returns.”

Although U.S. companies lead the list, they comprise only 12 of the 100. The United Kingdom dominated with 24; Canada and Australia took the bronze medal with 9 each.

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"PG&E" refers to Pacific Gas and Electric Company, a subsidiary of PG&E Corporation.