Brazilian Corporate Still Lead the Way

Brazilian corporates won the highest marks for corporate social responsibility (CSR) and corporate governance (CG), risk, and overall sustainability, according to a LatinFinance study in association with Madrid-based consultancy Management & Excellence (M&E). The region’s largest economy again shines in relation to the rest of LatAm in the second-ever assessment of the region’s largest power, energy and oil and gas entities by market capitalization. “Sustainability has matured with a need to look beyond mere compliance,” says William Cox, managing director at M&E. This year’s rankings incorporate quantifiable sustainability performance and risk-to-compliance in order to determine whether companies are successfully implementing sustainability and not just paying lip service to it, he explains. Petrobras tops the overall scores, led not only by high compliance but by achieving a much higher mark in the performance category (which measures implementation) than peers. On the energy side, CPFL and Cemig’s scores tell a similar story. Companies like Argentina’s YPF and Chile’s Enersis fall short in performance, while OGX’s inconsistency in implementation sees it get the lowest rating. Both power and oil and gas saw a wide distribution of scores. Scores tabulated for the Mining and Telecoms sectors will be released later this year. Cox says CPFL and Petrobras score well compared to the global leaders in their sectors. He points out that CPFL’s equity price jumped by 108% between March 2009 and March 2011, while Enersis came in last in the sector, with a 34.3% rise. The two also both publish annual sustainability reports. Globally, more companies should begin to be rated according to sustainability performance, Cox says.