|
The PSI 3.00
Scoring System
Intent scoring
criteria
Intent category measures the coverage and company’s involvement in general
environmental or social issues. The criteria of scoring topics in intent
category are a discussion and an example of an initiative or action taken by the
reporting company.
Reporting
scoring criteria
Environmental reporting scores indicate transparency in publicly discussing the
company’s dealing with environmental issues independent of success in making
improvements. The maximum score for each topic in the reporting category is five
points.
In this category, the
depth of reporting is categorized into qualitative and quantitative elements.
The three levels of
reporting qualitative topics are:
1. Discussion of the
topic (1.66 points)
2. Initiative or
action taken by the company on the topic (1.66 points)
3. Demonstration of
an external context that shows how performance relates to that of peer
companies, to that of industry standards, or demonstrates recognition from
third parties (1.66 points)
The five levels for
quantitative topics are:
1. A discussion on
the topic (1 point)
2. An external
context (1 point)
3. One or more
explicit numerical goals (1 point)
4. At least one
previous measure of performance for the topic (1 point)
5. More than one
previous measure of performance for the topic (1 point)
In the social
reporting category, there are a series of human rights topics that are given
full credit (5 points) if they are mentioned.
Performance
Scoring Criteria
In this scoring
period, we give a maximum of two points for performance. Topics analyzed in the
reporting and performance categories are identical, however the performance
scores is derived from different criteria.
For quantitative
topics, when the current performance is superior to that previously reported, we
give one point. We give another point when the current performance is better
than the industry average. Another point is awarded if the latest numerical
value of the quantitative performance is above the mean value of all of the
performance values we have for the particular sector analyzed. In other words,
individual companies cannot be scored fully independent of data from other
companies in the sector.
For qualitative
topics, we give one point for an external context and another point for an
indication of improvement from the previous report or year. We assign full
credit for reports mentioning human rights topics.
In the social
performance category on human rights two points is given if they are mentioned.
What do the
scores mean?
We normalize all the
scores to the potential maximum score. Scores of subsets of the overall score
are also normalized to their potential maxima.
The letter grades
(A+, A, A-, B+, etc.), however, are normalized to the highest scoring company in
the sector, in the same sector.
Companies with scores in the highest 4% get A+ and any in the bottom 4% get F.
We assign these by dividing the maximum PSI score obtained in the sector into 12
equal parts then rounding fractional score up or down. This means that A+ and F
are under-represented compared the other grades. The same technique applies to
the separate categories of environmental and social scores. Thus, we grade on
the curve. We assume that the highest score obtained in the sector and any
scores near it represent the state of the art for that sector and deserve an A+.
Additional Information
on the PSI Scoring System:
The PSI
Scoring System
The Pacific Sustainability Index (PSI) uses two systematic questionnaires to
analyze the quality of the sustainability reporting—a base questionnaire for
reports across sectors and a sector-specific questionnaire for companies within
the same sector. The selection of questions is based on and periodically
adjusted to the most frequently-mentioned topics in over 900 corporate
sustainability reports analyzed from 2002 through 2007 at the Roberts
Environmental Center.
The Roberts
Environmental Center
The Roberts Environmental Center is an environmental research institute at
Claremont McKenna College (CMC). Its mission is to provide students of all the
colleges with a comprehensive and realistic understanding of today’s
environmental issues and the ways in which they are being and can be resolved,
and to identify, publicize, and encourage policies and practices that achieve
economic and social goals in the most environmentally benign and protective
manner. The Center is funded by an endowment from George R. Roberts (Founding
Partner of Kohlberg Kravis Roberts Co. and CMC alumnus), other grants, and
gifts, and is staffed by faculty and students from the Claremont Colleges.
Our Goals
The philosophy of the PSI is described in detail in our book, Clean, Green, and
Read All Over published by and available from the American Society for Quality
Press*. The selection of PSI topics is constantly adapted to include topics
discussed in the world’s best sustainability reports, raising the bar for better
sustainability reporting in the future. We also encourage all of our readers to
contact us for consultation on better sustainability reporting or for recruiting
our student analysts who often look for corporate summer internships and
post-graduation positions in environmental education or environmental
communications.
Methodology
Our analysts download relevant English web pages from the main corporate website
for analysis. Our scoring excludes data independently stored outside the main
corporate web site. When a corporate subsidiary has its own sustainability
reporting, partial credit is given to the parent company when a direct link is
provided in the main corporate web site. We archive these web pages as a PDF
files. Our analysts use a keyword search function to search reporting of a
specific topic and based on their findings, they fill out a PSI scoring sheet
(http://www.roberts.cmc.edu/PSI/scoringsheet.asp), and track the coverage and
depths of different sustainability issues mentioned in all online materials.
Scores and
ranks
When they are finished scoring, the analysts enter their scoring results into
the PSI database. The PSI database calculates scores and publishes them on the
Center’s website. This sector report provides an in-depth analysis on
sustainability reporting of the largest, but not more than 30, companies of the
sector, as listed in the latest Fortune Global 500 and 1000 lists. Prior to
publishing our sector report, we notify and encourage companies analyzed to
provide feedback and additional new online materials, which often improve their
scores.
*http://www.qualitypress.asq.org/perl/catalog.cgi?item=H1145
Roberts Environmental Center at Claremont McKenna College
W.M. Keck Science Center
925 N. Mills Avenue
Claremont, CA 91711-5916
(909) 621-8190 or (909)621 8698 or (909) 621-8298
FAX (909) 607-1185
emorhardt@cmc.edu
|