Frequently Asked Questions

The announcement of 2021 honorees marks the fifteenth year we have honored companies with the designation of World’s Most Ethical Companies®

Yes. We evaluate a company’s (i) Ethics and Compliance Program, (ii) Culture of Ethics, (iii) Corporate Citizenship and Responsibility, (iv) Governance, and (v) Leadership and Reputation. Each category is evaluated through a combination of answers to our Ethics Quotient® (EQ) questionnaire, submitted supplemental documentation, and where necessary, independent research and follow up with a candidate. Evaluation of the Leadership and Reputation category also includes a review of publicly available information with a bearing on a company’s reputation for acting ethically (e.g., public filings, media review).

The World’s Most Ethical Companies® evaluation is an annual exercise. Each year’s evaluation process considers company programs information at the time it is submitted by the applicant and considers reputational information available up to December 31st of the year being reviewed. For example, the 2021 evaluation considers reputational information available up to December 31, 2020.

The EQ questionnaire is jointly developed by our internal team of legal and compliance professionals and our Methodology Advisory Panel. Advisory Panel members include leading experts from the fields of law, corporate reputation, corporate ethics, governance, and anti-corruption.

We review the questionnaire annually to ensure that it aligns with the ever-changing expectations of employees, managers, shareholders, regulators, and the public at large. For 2021, the question set has been updated and revised for clarity and to simplify the response burden. Questions were revised or added to better capture corporate citizenship and responsibility impacts, align with the new guidance released in June by the U.S. Department of Justice on Corporate Compliance Programs, keep up with evolving best practices, and capture companies’ responses to the current global pandemic and social justice issues.

We believe strongly that measurement matters. Utilizing the questionnaire allows us to include substantial quantitative and objective analysis in our process. The questionnaire is one step of our three-step review process. The first step is for a company to complete the Ethics Quotient (EQ) questionnaire. This results in an objective self-reported EQ score. Companies then submit documentation that allows us to qualitatively evaluate aspects of a company’s programs and processes. Lastly, Ethisphere’s team of analysts researches each company’s history of litigation, reputation, and ethical track record to inform the score for the company’s Leadership and Reputation. The self-reported scores are combined with the qualitative assessment of an applicant company’s supplemental documentation and independent research to produce a final EQ score.

A company’s final Ethics Quotient (EQ) score is evaluated relative to those of its peers within the context of its structure, size and operating environment. Those companies demonstrating the strongest application across our methodology receive the designation of being one of the World’s Most Ethical Companies. As applicant companies come from a variety of industries with significant differences in regulatory and operating environments, the overall EQ score is used to understand a company’s performance in context of similar companies, not to set a floor. However, reputation and legal issues are carefully evaluated. Receiving a materially deficient score in the category of Leadership and Reputation will prevent a company from being selected as one of the 2021 World’s Most Ethical Companies.

Our evaluation of a company’s reputation looks carefully at the perception of the company’s brand among stakeholders. We give an applicant credit for third-party recognitions indicating positive stakeholder perception. For example, we consider awards and accolades garnered as well as inclusion on indices related to governance, ethics and compliance, culture, environmental practices, citizenship, or social responsibility.

We off-set the credit given for third-party recognitions with any negative reputational issues faced by an applicant. Specifically, we conduct a review of publicly available information (e.g., public filings and Dow Jones Factiva business information and research tool) to understand any negative perceptions caused by an applicant’s legal compliance, litigation, environmental, or other ethical issues. This review has a five-year look-back period. Ethisphere bases its timing for the look-back period on the timing of an issue’s resolution. For example, if the conduct occurred in 2005, but the issue is settled in 2020, Ethisphere would consider the relevant timing to be 2020 for purposes of the five-year look-back period.

While evaluation of any particular issue is necessarily objective, Ethisphere considers the following factors in its evaluation: (i) how long-ago the conduct at issue occurred and when it was resolved, (ii) the seriousness of the conduct or issue, (iii) actions taken by the applicant to address the issue, and (iv) how the issue impacts the applicant’s reputation. If the issue is severe enough, it alone can exclude a company from being included on the World’s Most Ethical Companies List. In such a case, we will fully score the applicant’s submission and provide the Analytical Scorecard and feedback. We will also inform the applicant that, regardless of its performance within our evaluation process, the reputational issue precludes it from being included as one of the World’s Most Ethical Companies.

Given the necessary subjectivity of this reputational evaluation, we are happy to answer any questions you may have at [email protected].

No. Each section, question, and answer choice is individually weighted. Certain sections carry more importance than others, as do certain questions.

Any company, public or private, for-profit or not-for-profit, U.S. or foreign-based, is eligible to participate in the process and be considered for designation as one of the World’s Most Ethical Companies. That said, the Ethics Quotient questionnaire and peer group is generally designed for those companies with over $250 million in revenue. This does not mean that smaller companies cannot benefit from the process or be designated as one of the World’s Most Ethical Companies, but rather that our process is not suitable for many smaller companies unless they have the type of programs in place typically seen at larger companies.

Please note that while our process has broad eligibility requirements, non-profit colleges and universities, governments, governmental agencies, government majority owned companies, and NGOs are not eligible. If you have a question regarding eligibility please contact Ethisphere at [email protected].

We encourage wide participation, regardless of whether a company thinks that it will be honored. All companies that submit a survey will receive an Analytical Scorecard that provides their overall Ethics Quotient and evaluates how their score in each of the five categories compares to those of honorees. The value in participating is not only in learning how one’s company compares to the honorees, but also in better understanding what’s trending in leading companies and more about their best practices.

A company’s industry, size, geographic location, etc. are all taken into consideration during the review process. A company’s final Ethics Quotient (EQ) score is evaluated relative to those of its peers, within the context of its structure, size and operating environment. While we evaluate applicants within the context of their peers, we have minimum expectations for all companies, regardless of size or industry when designating the World’s Most Ethical Companies. Accordingly, regardless of size, for-profit companies will be compared to companies with at least $250 million (USD) in revenue and non-profit companies to those with at least $1 billion (USD) in revenue.

We understand that practices can be different for public, private, and non-profit organizations. Private organizations and non-profits are not penalized for failing to follow certain guidelines that are expected for public companies. However, all organizations must demonstrate that their policies, procedures, and practices are best in class for their specific organization type.

While our evaluation process begins with the objective scoring based on responses to the Ethics Quotient (EQ), our review does not end there. We also request applicants submit documentation to allow us to subjectively evaluate certain aspects of their program. The type of information submitted provides us an understanding of the program beyond answers to the EQ. For example, the EQ asks questions about modalities of communications; the supporting documentation goes further and allows us to evaluate the quality of the communications.

Ethics Quotient scores are adjusted based on documentation review and independent research. Each candidate then receives a final score that may be higher or lower than the initial “self-reported” score. Note that if we are unable to evaluate certain aspects of performance (i.e., requested documentation is not submitted), the resulting scores may be discounted.

Yes, we require all application materials to be submitted in English.

We supply a list of recommended documents in the Supplemental Documentation Guidelines provided to each applicant. As explained therein, applicants are expected to provide documents and evidence to support their responses to the Ethics Quotient questionnaire. Ethisphere will only contact an applicant regarding its supporting documentation if no documentation associated with the applicant company is received (this is to ensure there was not a problem in delivering or transmitting the documentation) or there is a technical issue with particular files or documents. If an applicant is missing a specific document or documents, Ethisphere will not contact the applicant nor will the applicant receive any points associated with review of such documents.

While Ethisphere will not contact an applicant except as specified above, new this year, each applicant will have a portal that will indicate whether documents have been received. Assuming an applicant submits documents as instructed, the portal will indicate whether documents have been received for each category.

Applicants trust us to keep all analysis and results of each company confidential. We take that responsibility seriously.

We do not disclose the names of companies who are not honored, and no individual response is made public. Scores will only be used to calculate EQ scores and/or provide a report or analysis to a company. We also use EQ scores and responses in an aggregated or anonymized fashion for benchmarking and research purposes.

Additionally, honorees may not publicly share or reference their company’s scores or performance compared to the World’s Most Ethical Companies’ averages. Our purpose is to celebrate all of the companies equally; accordingly, we very intentionally do not rank the companies that make the list each year. Sharing information or referring to the scores necessarily leads to a comparison among the honoree companies. Also, the selection process compares companies to their peers. Without context, publicizing how a company fares against the average scores misrepresents our process and could cause confusion.

We don’t publicly disclose the total number of applicants each year. We established this policy so that companies have the freedom to apply and be measured against others in total confidence and so that those who are honored recognize that their programs are being measured both competitively and on their own merits.

No. We evaluate every company independently and then in comparison to peers within the context of structure, size and operating environment. Because we’re recognizing companies that are the “most ethical” and not merely “ethical,” there is a natural limit to the number that we honor both in total and by sector. The number can vary based upon the ever-increasing expectations of stakeholders (both internal and external) and the fact that the scoring process is updated to reflect changes in best practice and methodology.
There are 131 companies spanning 21 countries and 50 industry sectors on the 2020 list.

Past honorees are given no inherent advantage over non-honorees or companies applying for the first time. Typically, companies that have participated in the evaluation process in previous years (both honorees and non-honorees) are more familiar with the expectations and therefore better prepared when it comes to completing the questionnaire and submitting supporting documentation.

We understand that many companies are stretched thin and that our process requires resources to complete. To that end, we have made an effort this year to simplify and streamline our application process while still collecting the information we need to properly evaluate each applicant. Our actions include reducing the number and type of supplemental documents requested, removing certain types of questions from the Ethics Quotient (EQ) questionnaire that past participants identified as burdensome to answer (e.g., those requiring answers in a table format), providing clear guidance on any changes to last year’s EQ questionnaire, providing last year’s responses to prior year applicants, simplifying and streamlining the EQ questionnaire in general, and adding questions to allow applicants to explain how they are addressing the unique circumstances faced from the pandemic. Finally, recognizing that each applicant may be dealing with a unique set of challenges, we are making an increased effort to be available to answer any questions or discuss any issues an applicant may have. If you have any questions or concerns, please contact us at [email protected].

A real benefit to participating in the Ethics Quotient (EQ) process is that all participants, whether or not they’re honored, receive a high-level analysis with their overall EQ score and how their five category scores compare to those who are honored as that year’s World’s Most Ethical Companies. This is an important and valued outcome of the process, since many organizations are looking to move forward both in compliance activities and ethical corporate behavior. This independent review allows a company to compare itself not just to any group of companies that want to complete a survey, but to those who excel and are named as the World’s Most Ethical Companies.

Companies that submit the Ethics Quotient (EQ) survey and supporting documentation between August 7, 2020 and November 13, 2020 are considered for inclusion in the World’s Most Ethical Companies recognition program for 2021. However, companies that would like to participate in the EQ—with the opportunity to be benchmarked against honored companies—may do so throughout the year, at any time.

Beginning in 2015, Ethisphere instituted a processing fee in order to, at least partially, cover the administrative costs of gathering and analyzing the data. The fee is $3,000 USD and also allows us to provide each participant with their benchmarked scores and best practices that helps to inform their programs and future decisions.

There are no additional fees to be honored or communicate either internally or externally that a company has achieved this designation. However, companies that wish to use the year-specific World’s Most Ethical Companies logo must license the logo and follow the branding guidelines. Ethisphere developed these guidelines in coordination with the Ethisphere community and by examining best practices from other organizations that review and recognize companies. Once licensed, the logo for that year may be used in perpetuity without additional fee.

Ethisphere receives revenue from conferences, event sponsorships, subscriptions to publications, advertising, membership groups, advisory services and licensing. No company that is honored with the World’s Most Ethical Companies designation is responsible for more than 1.3% of Ethisphere’s revenue. And no honoree may place advertising in the issue of Ethisphere Magazine that announces and highlights new honorees.

There is no connection between the two. Organizations are honored for their programs, practices, policies, and reputations as measured by the Ethics Quotient methodology.

Our mission is to define and advance the standards of ethical business practices that fuel corporate character, marketplace trust, and business success. We have a deep expertise in measuring and defining core ethical standards using data-driven insights that help companies enhance corporate character. We believe that this recognition program is important because corporate ethical standards must be set and measured and those who excel should be honored.

We strive to honor companies based on their body of work and not just one particular policy or program that is groundbreaking or admirable. Likewise, we don’t believe that one particular controversy, settlement, fine, regulatory action, or lawsuit necessarily disqualifies a company from being honored. That being said, these outcomes are taken into consideration during the evaluation time frame. How companies prepare employees for ethical dilemmas, how they respond to unethical or illegal actions once uncovered, and their general culture and policies are also considered in our evaluation.