FirstGroup, the UK’s biggest bus operator, was named the second best in the world for social, environmental and governance, while the Go-Ahead Group was the 10th best globally.
The German sportswear manufacturer Puma – rated the global leader – British drugs giant GlaxoSmithKline and the electronics maker Philips came out well in the report, by the responsible investment research service Eiris.
By contrast, US tech giants Apple and Google received low scores.
Ahead of the United Nations Earth Summit in Rio de Janeiro in June, Eiris examined the ethical record of all the 2,063 companies in the FTSE All-World Developed Index of large companies, giving them an A-to-E grading.
Among the world’s 50 biggest companies, all four given the lowest E grade were – perhaps unsurprisingly – oil and gas producers: ExxonMobil, Chevron, ConocoPhillips and Occidental.
However, there were also low grades for businesses popular with Western consumers, most notably Apple and Google, which both received D grades.
Pointing to the poor conditions of the Chinese workers who assemble Apple’s iPads and iPhones, Eiris said: “Apple has yet to tackle some of its most relevant ESG [environmental, social and governance] issues. Although the company has recently taken some steps to address this, for example through the auditing of some of their Chinese suppliers, it still has a considerable way to go to fully address all its sustainability-related risks.”
Mark Robertson at Eiris explained: “Google scores poorly overall when compared to other technology companies in its sector, largely a result of poor performance on environmental-management reporting.”
Puma – once associated with sweatshops and now the global ethical leader, according to the rankings – was praised for its efforts at improving the health and welfare of foreign workers.
Mr Robertson said: “Puma is a good example of a company that has made clear efforts to respond to some of the criticisms made against it.”
FirstGroup, Britain’s biggest bus operator with 20 per cent of services nationwide, came second worldwide and top among British businesses despite the environmental problems associated with transport.
The firm – which has improved the fuel efficiency of its UK bus fleet and installed solar panels and harvested rainwater – was “demonstrating significant improvements in its environmental performance, thereby mitigating risks associated with its environmental impact,” Eiris said.
A spokesman for FirstGroup, which also operates the First Great Western rail franchise, said: “We take our need to reduce carbon seriously.”
The Go-Ahead Group, another bus company, which operates the Southern, Southeastern and Gatwick Express rail franchises, was praised for generating more than 90 per cent of its turnover from sustainable public transport.
Globally, Eiris said UK and European firms were outstripping US and Asian rivals on ethics.
National Australia Bank (NAB), which owns Clydesdale and Yorkshire banks in the UK, came third globally. Banks are often heavily criticised for funding questionable practices, such as weapons, tobacco or firms with poor human-rights records, but Eiris praised NAB for confronting the ethical dilemmas in its business and training staff to reduce them when making decisions.
GlaxoSmithKline, the maker of drugs for cancer, diabetes and asthma, was praised for improving health care worldwide and for “promoting access to medicines in the developing world”.
Swiss drug companies Roche and Novartis were fifth and sixth – Roche chiefly for its “advanced code of ethics and anti-bribery management system” and Novartis for its “comprehensive environmental policy”.
The Dutch electronics giant Philips was seventh for its “environmentally and socially beneficial services”.
An Apple spokeswoman said: “We care about every worker in our worldwide supply chain. We insist that our suppliers provide safe working conditions, treat workers with dignity and respect, and use environmentally responsible manufacturing processes wherever Apple products are made. Our suppliers must live up to these requirements if they want to keep doing business with Apple.”
Google responded: “Reducing our environmental impact is something we have always cared about: it makes sense from a business perspective, but more importantly, it can do a lot of good and have huge benefits for the world.”
Ethical business: The top 10 firms
1: Puma Despite working in a sector notorious for human-rights abuses, the German firm has a strong environment record and treats foreign workers well.
2: FirstGroup More than 90 per cent of the UK company’s operations come from sustainable public transport, where it is making its buses more fuel-efficient.
3: National Australia Bank Owner of Clydesdale and Yorkshire banks trains staff to “understand and identify… environmental and social risks when doing business”.
4: GlaxoSmithKline As well as making products that make people healthy, the UK pharmaceuticals firm is praised for selling some drugs cheaper to developing countries.
5: Roche The Swiss pharmaceutical giant has a strong equal-opportunities policy and operates an “advanced code of ethics” – with strong anti-bribery rules.
6: Novartis Strong environmental reporting and an anti-bribery programme stand out at this Swiss-based pharmaceuticals company.
7: Philips Electronics The Dutch household and electronics giant has done a good job in making its products more energy-efficient.
8: Deutsche Börse The German stock exchange scores highly for its environmental record, particularly notable “decreases in paper consumption”.
9: Novo Nordisk Reducing water use and all-round environmental, social and governance record is strong at this Danish drugs giant.
10: Go-Ahead Group The bus and train company – one of three British firms in the top 10 – has a strong record on the environment.
…And some of the worst
Apple Given the second-worst score, D, Apple has not done enough to ensure the good treatment of Chinese workers, according to Eiris
Google The world’s favourite search engine, whose corporate motto is “Don’t be evil”, is rated a lowly D for the quality of its environmental reporting.
Toyota The Japanese car maker produces greener cars, but lags behind rivals on “human-rights and supply-chain-labour standards”, earning it a C.
Nestlé The Swiss food giant is far from the worst performer – receiving a C – but Eiris urged it to reformulate products to improve nutrition and reduce obesity.
Chevron Along with the other major oil and gas producers, including ConocoPhillips and Occidental Petroleum, Chevron is given the lowest ranking.
ExxonMobil Scoring an E too, the world’s biggest company is criticised in the Eiris report for doing too little on “biodiversity, climate change and water management”.