Making it onto the World’s Most Ethical Companies list proves to be more and more difficult every year. This year Ethisphere received a record number of nominations from companies in over 100 countries and 35 industries.

This year, 99 companies made the cut. Twenty companies dropped off the list from last year, and 25 companies were newcomers. A remarkable 44 companies are “three-peats,” making the list for the past three years.

Below you’ll find the methodology used to determine winners, as well as a few callouts from companies that made the list, and how they encourage ethics throughout their company on a day-by-day basis.

2009 World’s Most Ethical Companies Selection Process:

1. The Methodology

A methodology committee of leading attorneys, professors, government officials and organization leaders, assisted Ethisphere in creating the scoring methodology for the World’s Most Ethical Companies awards.

2. Candidate Selection

Over the course of the year, companies across the world submitted their applications to become 2009 World’s Most Ethical Companies. Based on these applications, as well as information Ethisphere gathered throughout the year, a list of semi-finalists was created.

3. In-Depth Analysis

At this stage, semi-finalist companies were notified and given an in-depth survey questionnaire to fill out regarding their ethics and compliance program, governance and corporate responsibility.

4. Further Refinement

Ethisphere then conducted data analyses on hundreds of companies based on their responses to the survey, as well as documents and information researched and requested by Ethisphere to confirm survey responses. Every company was then given an EQ score based on the results of the survey and measured against seven distinct categories. These categories were Corporate Citizenship and Responsibility; Corporate Governance; Innovation that Contributes to the Public Well Being; Industry leadership; Executive Leadership and Tone from the Top; Legal, Regulatory and Reputation Track Record; and Internal Systems and Ethics/Compliance Program.

Corporate citizenship and responsibility: 20%

How does the company respond to the community and workplace, what is the company’s sustainability track record and how does it audit its supply chain? Ethisphere factored in placement on major sustainability lists, such as FTSE4Good Index Series.

Corporate governance: 10%

Is the company properly aware of potential value conflicts at and around the company and address those conflicts in an effective way?

Innovation that contributes to public well being: 15%

Does the company provide products, services and/or process innovation that positively contributes to public well-being?

Industry leadership: 5%

How does the company set industry standards for business ethics and compliance, corporate governance, responsibility, sustainable development and environmental protection?

Executive leadership and tone from the top: 15%

Does the company have strong and visible executive leadership on ethics, corporate governance and citizenship?

Legal, regulatory and reputation track record: 20%

What is the legal history of the company?

Internal systems and ethics/compliance program: 15%

Does the company have satisfactory internal control systems, including a leading Code of Conduct, whistle-blower policies, prevention and detection controls, etc?

5. The Winners…

The highest EQ scores for each industry became this year’s 2009 World’s Most Ethical Companies.

You can find more in-depth information on the methodology for 2009’s World’s Most Ethical Companies at www.ethisphere.com/worlds-most-ethical-companies-methodology/.

2009 World’s Most Ethical Companies

Honeywell International USA • Aerospace and Defense	The Aerospace Corporation USA • Aerospace and Defense
Harris Corporation USA • Aerospace and Defense
Nike USA • Apparel	Patagonia USA • Apparel
BMW Germany • Automotive	Cummins USA • Automotive
Johnson Controls USA • Automotive	Toyota Motor Japan • Automotive
HSBC UK • Banking	Rabobank Netherlands • Banking
Standard Chartered Bank UK • Banking	Westpac Banking Corporation Australia • Banking
Accenture Bermuda • Business Services BELA Member	Pitney Bowes USA • Business services
Dun & Bradstreet USA • Business Services BELA Member
Ecolab USA • Chemicals BELA Member	Dell USA • Computer Hardware BELA Member
Hewlett-Packard USA • Computer Hardware	Ricoh Company Japan • Computer Hardware
Xerox USA • Computer Hardware	Oracle Corporation USA • Computer Software
salesforce.com USA • Computer Software	Symantec USA • Computer Software
Henkel Germany • Consumer Products	Kao Japan • Consumer Products
Mattel USA • Consumer Products	SC Johnson & Son USA • Consumer Products
Unilever Netherlands/UK • Consumer Products	General Electric USA • Diversified Industries BELA Member
Freescale Semiconductor USA • Electronics & Semiconductors	Intel USA • Electronics & Semiconductors
Texas Instruments USA • Electronics & Semiconductors	Duke Energy USA • Energy & Utilities
FPL Group USA • Energy & Utilities	Sempra Energy USA • Energy & Utilities BELA Member • EIC™ Certified
Statkraft Norway • Energy & Utilities	Wisconsin Energy USA • Energy & Utilities
CRH Ireland • Engineering & Construction	Fluor USA • Engineering & Construction BELA Member
CH2M Hill USA • Construction and Engineering	Holcim Switzerland • Engineering & Construction
Waste Management USA • Environmental Services & Equipment
American Express USA • Financial services BELA Member	The Hartford Financial Services USA • Financial services BELA Member
The Principal Financial Group USA • Financial services	Danone France • Food & Beverage
General Mills USA • Food & Beverage	Kellogg Company USA • Food & Beverage
PepsiCo USA • Food & Beverage BELA Member	Stonyfield Farm USA • Food & Beverage
Sodexo France • Food Service	Safeway USA • Food Stores
Trader Joe’s USA • Food Stores	International Paper USA • Forestry, Paper & Packaging
Stora Enso Finland • Forestry, Paper & Packaging	Svenska Cellulosa (SCA) Sweden • Forestry, Paper & Packaging
Weyerhaeuser USA • Forestry, Paper & Packaging	Target USA • General Retail
Cleveland Clinic USA • Healthcare	Johns Hopkins Hospital USA • Healthcare
Premier USA • Healthcare	Accor France • Hotels, Travel & Hospitality
Marriott International USA • Hotels, Travel & Hospitality	Caterpillar USA • Industrial Manufacturing
Eaton Corporation USA • Industrial Manufacturing BELA Member	John Deere USA • Industrial manufacturing
Milliken USA • Industrial manufacturing EIC™ Certified	Rockwell Automation USA • Industrial Manufacturing
Aflac USA • Insurance	Sompo Japan • Insurance
Swiss Re Switzerland • Insurance	Google USA • Internet
Zappos.com USA • Internet
Thomson Reuters Canada • Media, Publishing & Entertainment	Time Warner USA • Media, Publishing & Entertainment
Baxter International USA • Medical Devices	Becton Dickinson USA • Medical Devices
Royal Philips Netherlands • Medical Devices	Flint Hills Resources USA • Oil & Gas
Petro-Canada Canada • Oil & Gas	AstraZeneca UK/Sweden • Pharma & Biotech
Novartis Switzerland • Pharma & Biotech	Novo Nordisk Denmark • Pharma & Biotech
Novozymes Denmark • Pharma & Biotech	Jones Lang LaSalle USA • Real estate BELA Member • EIC™ Certified
McDonald’s USA • Restaurants & Cafes BELA Member • EIC™ Certified	Starbucks USA • Restaurants & Cafes
Best Buy USA • Specialty Retail	Gap USA • Specialty Retail
IKEA Sweden • Specialty Retail	Marks & Spencer UK • Specialty Retail
Ten Thousand Villages USA • Specialty Retail	Avaya USA • Telecom Hardware BELA Member
Cisco Systems USA • Telecom Hardware EIC™ Certified
T-Mobile USA • Telecom Services	Vodafone UK • Telecom Services
Nippon Yusen Kaisha Japan • Transportation and logistics BELA Member	United Parcel Service USA • Transportation and logistics

Spotlight on Selected Winners

What goes on behind the scenes of a company to make it one of the World’s Most Ethical? We asked a number of individuals directly responsible for the ethical direction of their company. Following are some excerpts from their responses:

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Accenture

Douglas G. Scrivner, General Counsel, Secretary & Compliance Officer

In Accenture’s ethics and compliance program, the company uses six “core values” of stewardship, best people, client value creation, one global network, respect for the individual and integrity.

Douglas Scrivner, General Counsel at Accenture, says that ethics and compliance can’t be effective if they’re only seen as “bolt-ons,” or something that is only done at the end of the day after the “regular work” is complete. “We aim to put ethics and compliance into the way our people work and lead. We seek to leverage existing processes, procedures, structures and functions to ensure the outcomes we are expecting and alignment with the goals of the organization,” says Scrivner.

To better understand how the company’s ethics and compliance program is being received by employees, Accenture uses employee surveys, risk assessments and results of corporate investigations. Scrivner notes that in a recent survey, over 90 percent of employees feel that Accenture is highly ethical and that the company’s commitment to integrity has been communicated to the whole company.

“Those are excellent scores for a company of more than 181,000 people,” Scrivner says. “We haven’t arrived at the end of our journey (and never will), but I am confident that we continue to move in the right direction and continually reinforce our commitment and our expectations in this area.”

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Caterpillar

Ed Scott, Chief Ethics & Compliance Officer

Ed Scott, Chief Ethics and Compliance Officer at Caterpillar, says that the ethics at Caterpillar start at the top, beginning with CEO Jim Owens. “Our leaders work to ensure that Our Values in Action [Caterpillar’s Code of Conduct] are part of everyday life at Caterpillar,” says Scott. “They take various opportunities to incorporate Our Values in Action into their communications. In turn, Caterpillar employees are expected to know and live by Our Values in Action.”

Scott says that he is most proud of the way that the company’s ethics program reaches out to the thousands of Caterpillar employees working in around 50 countries in all regions of the globe. “Over the past few years, we’ve made significant strides in globalizing our approach,” says Scott. “One item in particular is our Annual Assessment and Questionnaire. It is offered in 14 languages and all of our employees are required to complete this. You can imagine that with so many employees, this is a major undertaking.”

Scott believes that any company’s ethics and compliance program is only as strong as the culture behind it. “You can have the best ethics and compliance program in the world, but if you don’t have an ethical culture supported by strong leadership, the program will ultimately not succeed,” Scott says. “Generations of Caterpillar people built our honorable reputation and ethical culture through their words and deeds.”

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General Mills

Roderick A. Palmore, Executive Vice President, General Counsel, Chief Compliance and Risk Management Officer

As a well established global business, General Mills knows that ethics programs must be adaptable to the different regions in which the company operates. “A strong ethics and compliance program must feel culturally relevant to employees,” says Roderick Palmore, General Counsel of General Mills. “A program that genuinely reflects the culture and values of a company helps employees understand and incorporate the messages of the program into their daily decisions. Employees experience them as part of the very fabric of the company’s culture.”

To help employees learn from prior real-world decisions—both good and bad—General Mills developed a feature on its company Intranet that uses real examples that came from the company’s Ethics Line. “We continually look for opportunities to incorporate real stories from our history to bring to life our heritage of integrity and to respond to that feeling of pride we all have in working for General Mills,” Palmore says.

Palmore says that in order to remain relevant, General Mills makes sure that its ethics and compliance program is continually evolving in a real-time way to meet the needs of a constantly changing demographic-base of employees. “We strive to be the best,” Palmore says. “That means we need to stay fresh in our thinking and be in touch with best practices.”

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Philips Electronics North America

Brent Shafer, CEO

Above and beyond mere “word play” towards and ethics program, Philips links its sustainability and ethics programs with the company’s core strategy. And, even more important, Philips grades its success by measurable results. By 2012, Philips aims to generate 30 percent of total revenue off Green Products, further increase energy efficiency of the company by 25 percent and double the company’s investment in Green Innovations to €1 billion.

“Our performance in 2008 shows that we are well on track to achieve these goals with 25 percent of total sales coming from Green Products, investing 282 million euros in green innovations and reducing our carbon footprint by 5 percent,” says Brent Shafer, CEO of Philips Electronics in North America. “We communicate transparently on our sustainability performance through our annual report that is independently verified by a third party.”

Shafer notes the importance of transparency when it comes to reporting about the ethical environment of the company, especially in developing countries. “It is important for anyone with an interest in Philips to know that any corporate targets, whether it is a sales goal or growth ambition, will not happen at the expense of non-compliance with the Philips General Business Principles,” Shafer says. “This risk is heightened in emerging markets as corporate governance systems are less developed in emerging markets compared to mature markets.”

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Unilever

Iskah C. Singh, Deputy Global Code & Compliance Officer, Associate General Counsel

Unilever uses a number of approaches to engage its employees in the company ethics and compliance program, according to Iskah Singh, Associate General Counsel for Unilever.

“Our employee training and education program raises awareness and reinforces the values of the Code of Business Principles,” says Singh. “Also, employees annually acknowledge understanding and compliance with our Code of Business Principles. In addition to traditional training modules, we have utilized smaller ‘Ethical Moments’ – 3 to 5 minute clips – to raise awareness and strengthen the open ethics and compliance environment.”

Singh says that a strong ethics and compliance program provides many benefits: solid leadership; encourages and facilitates open communication; clearly articulates the standards of business conduct; continually reinforces ethics awareness and actively demonstrates that the values are not just words on paper but are lived on a daily basis.

Singh notes that a key differentiator in Unilever’s ethics and compliance program is the fact that employees deep within the organization can look to their immediate supervisors as examples of ethical leadership. “It is here that an ethical culture is cultivated and the standards and values of Unilever’s Code of Business Principles is given meaning,” says Singh.

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T-Mobile USA

Robert Dotson, President and CEO

Robert Dotson, president and CEO of T-Mobile USA says that the real test of a company’s ethics program is the extent to which it is “in the fabric” of all employees. He says that happens through strong tone of the top. “That emphasis also echoes through the halls of our parent company, Deutsche Telekom,” says Dotson. “However it also includes active participation and support from our employees. Our employees strive to get results the right way; they regularly raise issues or questions to management on our anonymous Integrity Line; and they take personal responsibility for how they live the values in their quarterly performance reviews. It’s a top to bottom program that is owned at all levels of the company.”

Dotson adds that T-Mobile is a fast paced company in a competitive industry, and that “brings a certain amount of pressure to develop game-changing products, outpace the competition, and drive excellent financial results.” But, he says, that shouldn’t affect how the products are developed or how the company operates. “Our employees know that getting great results is only part of the equation,” Dotson says. “We expect everyone to get the right results, the right way. ‘Performance’ and ‘values’ are like two wings of an airplane – they are both required for success, and you really would never try flying without one of them.”

Send your comments to Ethisphere editors by sending an email to letters@ethisphere.com. Your comments may be published in an upcoming issue of Ethisphere Magazine.