2009 SB20: The World's Top Sustainable Stocks

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This is the 8th year for the SB20, the World’s Top Sustainable Stocks. As in past years, we worked with a group of judges who are leading green stock analysts to select the companies.

The Judges

Our judges are some of the most respected green analysts in the world:

Rafael Coven, Managing Partner, Cleantech Indices LLC
Matt Patsky, Managing Partner, Winslow Management Company
Elizabeth Levy, Research Analyst, Winslow Management Company
Jules Frieder, Environmental Analyst, Calvert Group
Ton Rennen, Senior Sustainability Analyst, Triodos Bank NV
Arthur van Mansvelt, Sustainability Analyst, Triodos Bank

The purpose of the SB20 – the Sustainable Business 20 – is to showcase innovative, model companies that are leading us toward our ultimate goal of reaching a green economy.

The challenge we give our judges is to nominate, discuss and then vote on 20 companies that, through their products or initiatives, have made substantial contributions over the past year.

This year, the judges were tasked with the proposition of selecting companies that are progressing even during this recession.

To be on the list, companies must be strong on both the sustainable and financial sides. It is not a "buy" list, but because the companies are strong financially, their stock may well be worth be buying at some point based on stock market positioning. We strive to choose companies of various sizes, industries and parts of the world, but the list isn’t meant to constitute a diversified portfolio.

SB20 Criteria Our judges selected the 20 companies on this year’s list based on the following Sustainability and Financial criteria: Sustainability Criteria: The most exciting companies in terms of how they are conducting their business, or in the disruptive green technologies they are advancing that solve our environmental problems and lead us to a sustainable society. In particular, they have a very strong GREEN story, with the ability to have widespread influence. Companies must have made major announcements and/or significant progress in meeting targets over the past year. Financial Criteria: Companies are profitable with strong management and balance sheets. Development stage companies must have revenue and be on track to profitablity. Each company would enhance an investment portfolio although it may not be in buying position today.

If it’s not a "Buy" List, then why do we do it?

Although there’s no shortage of information on the environmental performance of companies, it remains scattered and difficult to find. Few people have the time or interest to plow through sustainability reports of thousands of companies, yet we receive requests from the media, financial advisors and individual investors, NGOs, research firms and others asking us which are the top companies and how to differentiate among them.

It’s hugely important that companies that stick their necks out feel appreciated for their work. While it’s easy to make small improvements and send out press releases, it’s exceedingly difficult to literally transform the way a business operates – the products they make, how they distribute them and how they dispose of them – which is what we’re asking them to do.

Many of the "corporate pioneers" depend on us to get the word out on what they do on an-going basis – the really tough work of measuring and reducing carbon emissions, using lifecycle analysis to design products, working with suppliers to meet their green criteria, reducing toxics in products, etc. Much of this work isn’t "newsworthy" and doesn’t get covered by the press, who often doesn’t have a good grasp of its importance.

Another reason we do it is to provide a contrast to the many "best company lists." Although there are many factors that make a company stand out from its peers including governance, employee and community relations, scoring a company on many criteria at once leads to a diluted results. A company can be mediocre on environment performance but excel on community relations and still get high marks, for example. Also, many lists focus on the largest companies, mostly in the U.S.

Over the years we’ve found the exercise of choosing only 20 companies enables us to zero in on the truly outstanding companies that stand head and shoulders above the crowd on environmental performance. Since we’re examining a small universe of companies, we look at them in great depth. We don’t select a company because it’s in "solar" or is a "renewable energy developer." We always ask: what makes this company a leader? And ask hard questions, such as: Does this company have any problems in the communities it operates in?

By analyzing companies based on the deep knowledge and experience of our judges, rather than by using numerical formulas, we’re able to choose small, medium and large companies from every region of the world.

The 2009 SB20 List

Company Name	Ticker	Sector	Country
Bendigo and Adelaide Bank	BEN.ASX	Corporate Pioneer/ Finance	Australia
Chipotle Mexican Grill	NYSE: CMG	Corporate Pioneer/Food	USA
First Solar	Nasdaq: FSLR	Solar Energy	USA
Gamesa Corporacion Technnologica	GAM.MC; GCTAF.PK	Wind Energy	Spain
Google, Inc.	Nasdaq: GOOG	Corporate Pioneer/ Technology	USA
Herman Miller	Nasdaq: MLHR	Corporate Pioneer/ Green Building	USA
IBM	NYSE:IBM	Corporate Pioneer/ Technology	USA
Naturex SA	NRX.PA	Food	France
Novo Nordisk	NOVO B.CO; NYSE: NVO	Corporate Pioneer/ Pharmaceuticals	Denmark
Novozymes	NZYM.CO; NVZMY.PK	Industrial/ Cellulosic Ethanol	Denmark
Ormat Technologies	NYSE: ORA	Geothermal	USA
Philips Electronics	NYSE: PHG	Corporate Pioneer/ Green Building	Netherlands
Plant Health Care	PHC.L; PLHCF.PK	Agriculture	UK
Pure Technologies	PUR.V	Water	Canada
Telvent Git, SA.	Nasdaq: TLVT	Smart Grid	Spain
Timberland	NYSE: TBL	Corporate Pioneer/ Apparel	USA
United Natural	Nasdaq: UNFI	Food	USA
Vestas Wind Systems	VWS.CO; VWDRY.PK	Wind Energy	Denmark
WaterFurnace Renewable Energy	WFI.TO; WFIFF.PK	Geothermal Heat Pumps	USA
Westport Innovations	Nasdaq: WPRT; WPT.TO	Transportation	Canada

There are two categories of companies:

Green Pioneers: companies that produce green products/ services, such as solar and wind;
Corporate Pioneers: companies that produce conventional products/ services that are greening their operations and product lines, such as electronics and pharmaceuticals.

The judges consider these questions when they nominate companies:

* Is the company a leader in sustainability that others can look to as a model?
* Is the company meeting aggressive targets and setting new ones?
* Is the company having or has the potential to make a big impact?
* Does the company stand out from its peers?
* Is the company profitable or on a clear path towards profitability?

After they select the leading companies, we look at the list as a whole and choose a mix of companies in terms of size, industry sector, and region of the world.

Read Snapshots of all the SB20 Companies by clicking into each company name on the list.

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