Ratings & Assessment

A common misconception is that the guide indicates ’ethical’ or ‘unethical’ companies.  In reality companies have praises or criticisms in particular areas, which make them ‘more’ ethical or ‘less’ ethical in these areas depending on the criteria being focused on. The overall rating for a Company tree is useful in broadly comparing companies according to whether they have more or less criticisms or praises. This however, is intended as a first-step way to apply the information, and it must be noted that it does not compare ‘apples with apples’.

In 2015 the ‘colour/letter’ rating icons were introduced to replace the ‘tick/cross’ icons in order to give a more accurate summary of the assessment data.

Methodology Overview

The focus of our database is the companies behind common brands and the social and environmental track record of these companies. This information is found in our smart phone app, pocket-print-guide and website.

new_ratings_menu1The guide seeks firstly to make publicly available information pertaining to a company’s track record available in one place. Our task is largely one of making pre-existing information accessible to the average shopper.

A second function is to assist consumers in applying this information to their everyday purchasing choices. The ratings in the guide signify that one or more companies in the ownership tree has significant criticisms (or praises with no criticisms) from specific selected sources.

Please note the focus of the Shop Ethical! guide is on a company’s track record, rather than the features of the products themselves. Products with outstanding features are noted however (with a Green Star).

The ratings are not an endorsement or comment upon an individual company or brand, beyond the information gathered. We encourage people to follow the links to the reports themselves and to evaluate the information using their own judgments based on what they value.

How does it work

1. Transparency

We gather assessment information for companies related to common brands. These assessments can be grouped broadly under the areas of environment, social, animals, and business governance. All assessment is linked to sources documents.

2. Weighting

Assessments are weighted as Praise, Lesser Praise, Lesser Criticism, Criticism or Boycott Call. These weightings generally count towards a company’s rating*. Additionally assessments can also be weighted as Minor Praise, Minor Criticism and Neutral, and listed under the Information heading. These do not count towards the company’s rating. (See icon decoder)

* Exceptions – (1) if a company has praises and no criticisms (full, lesser or boycott call), but does have minor criticisms, then ratings are downgraded from a tick to a light tick. (2) if a company has an annual revenue exceeding one billion dollars, then ratings are downgraded from an ‘A’ to a ‘B’. This is consistent with our approach of supporting small local businesses over large multinationals.

Weighting is at our discretion. An example of an assessment weighted as a Lesser Praise than (full) Praise is ‘signatory to the Australian Packaging Covenant’ as it is a voluntary agreement where companies set out their own action plan and goals for waste minimisation.

3. Up the tree.

The overall company tree rating , as seen in the ‘Company Ratings’ icon decoder (image above), is calculated using the following rules.

Rules for calculating ratings

Each company is given a total numerical score, which is calculated by adding up praises and criticisms for a company, including companies up the ownership tree.

Lesser Praise = 1                      Full Praise = 2

Lesser criticism = -1                 Criticism = -2

The overall rating (ie. colour dot/grade) is then calculated using the following rules.

Green              3 or more points

Lt Green         1 or 2

Grey                No praises, no criticisms

Yellow             0 or more, but has at least one criticism

Orange            -1 or -2

Red                  -3 or less

This points system has the following overrides/exceptions:

> Company revenue exceeding $1billion limits the potential rating to Lt Green
> Any minor criticism limits potential rating to Lt Green
> Any lesser or full criticism limits potential rating to Yellow
> Assessment tagged ‘boycott call’ limits potential rating to Red
> A company can only get a maximum of 3 points (or -3 points) for any one assessment subcategory (eg. climate change, workers rights)

Please note: our previous rating system using ticks and crosses for praises and criticisms displayed the same information. We have moved to this updated system using colors and letters in order to give a clearer summary of the assessment data. Please see individual company profiles for specific assessment details.

(More on negative and positive screens).

4. Compare.

Our comparison pages (ie. beer) list common brands with their primary related company and parent company in brackets. The primary related company listed is usually the manufacturer. We assume manufacturer and brand owner are the same unless otherwise stated*. If there are other related companies, these are listed underneath along with the type of relationship (eg. brand owner). The ‘owned’ icon and ‘rating’ icon are for the overall ownership and rating of the company tree (primary company, parent companies).

* Exception – For Supermarket Housebrands the supermarket is most often the brand owner AND the exclusive retailer of a listed product (ie. Coles). In this case that company is listed as the primary related company. The manufacturer, where available, is listed underneath.

Product Features
Products under a brand that have outstanding features are highlighted with a green star. Outstanding ethical or sustainable features include certified organic, GE free, recycled content and fair trade. Details can be seen by mousing over the star.
Industry Alert

While we’ve identified companies that are more or less preferable given their company record, the common practices within some industries may be damaging, or the product may have substantial health concerns, enough to warrant avoiding the product completely.

Examples of such practices are factory farming for eggs, chickens and pigs; child labour and exploitative work conditions for coffee, chocolate, clothing and footwear; tobacco, directly linked to lung cancer; and batteries, leaving toxic chemicals in landfill.

Wheexplainationmarkre this symbol appears next to the product type heading we recommend seeking products with an outstanding product feature star that addresses the particular concerns.

Sources criteria

We seek sources that are:

  1. independent and impartial (separate from an organisation’s own claims),
  2. recognised and reputable (not someone’s blog site),
  3. systematic and reasonable (have methodology)

All assessments use existing, publicly accessible information. We seek to make this transparent and accessible to the everyday shopper in a way that assists in making positive buying choices. We have used the principles below as a guide for inclusion of assessments. We document where possible the reasons for inclusion if they fall outside those listed below.

Criteria for inclusion:

  1. Broadly relate to company record under the areas of environment, social, animals, and business governance.
  2. Fall into one of three general categories:
    • external – independent assessment or critique from a third party (including news reports)
    • voluntary covenant – company signs up to an external agreement
    • self-disclosure – own reporting managed by third party
  3. Not older than five years.

Generally if assessments use sources that fall outside these criteria, the assessments are tagged as ‘information’ (rather than ‘praises’ or ‘criticisms’) and so do not add in the calculation of the company-tree rating.

Key Sources

(Assessment data is updated weekly. See full list – 195 sources, August 2013 ).

See key sources below.

CAMPAIGNS / REPORTS / SCORECARDS
Animals Australia www.animalsaustralia.org.au
Australian Fashion Report www.behindthebarcode.org.au
Babymilk Action www.babymilkaction.org
Campaign for Safe Cosmetics www.safecosmetics.org
Carbon Disclosure Project Index www.cdp.net
Carbon Reduction Institute www.noco2.com.au
China Labor Watch www.chinalaborwatch.org
Choose Cruelty Free Preferred Products www.choosecrueltyfree.org.au
Clean Clothes Campaign www.cleanclothes.org
Climate Counts www.climatecounts.org
Conflict Minerals Company Rankings www.raisehopeforcongo.org
Electronics Industry Trends Report www.behindthebarcode.org.au
Ethical Clothing Australia www.ethicalclothingaustralia.org.au
FREE2WORK www.free2work.org
FOE Emerging Tech Project www.emergingtech.foe.org.au
Global Exchange www.globalexchange.org
Greenpeace Canned Tuna Guide www.greenpeace.org.au/tuna
Greenpeace Cool IT Leaderboard www.greenpeace.org/coolit
Greenpeace Guide to Greener Electronics www.greenpeace.org/greenerelectronics
Greenpeace True Food Guide www.truefood.org.au
HRC Corporate Equality Index www.hrc.org
Humane Society Fur-Free List www.humanesociety.org
Institute for Global Labour and Human Rights www.globallabourrights.org
International Labor Rights Forum www.laborrights.org
KnowTheChain www.knowthechain.org
Newsweek Green Rankings www.newsweek.com/green
Open Secrets www.opensecrets.org
PETA animal testing factsheet www.caringconsumer.com
Project on Emerging Nanotechnologies www.nanotechproject.org
Skin Deep Cosmetics Database www.ewg.org/skindeep
WWF Palm Oil Buyer’s Scorecard www.panda.org/palmoil
CORPORATE ACCOUNTABILITY
As You Sow www.asyousow.org
Corporate Accountability International www.stopcorporateabuse.org
Corporate Critic www.corporatecritic.org
Corporate Research Project www.corp-research.org
Corpwatch www.corpwatch.org
Environmental Working Group www.ewg.org
Ethical Company Organisation www.ethical-company-organisation.org
Ethical Consumer www.ethicalconsumer.org
Facing Finance www.facing-finance.org
Friends of the Earth www.foe.org
Greenpeace www.greenpeace.org
Knowmore www.knowmore.org
Multinational Monitor www.multinationalmonitor.org
Oxfam www.oxfam.org
Rainforest Action Network www.ran.org
RankaBrand www.rankabrand.org
Responsible Shopper www.responsibleshopper.com
SUSTAINABILITY INDEXES / CSR
Corporate Responsibility Index www.corporate-responsibility.com.au
Dow Jones Sustainability Index www.sustainability-indices.com
VOLUNTARY AGREEMENTS
Australian Packaging Covenant www.packagingcovenant.org.au
Bangladesh Safety Accord www.bangladeshaccord.org
Conflict-Free Sourcing Initiative www.conflictfreesourcing.org
Electronic Industry Citizenship Coalition www.eiccoalition.org
Ethical Trading Initiative www.ethicaltrade.org
Fair Labor Association www.fairlabor.org
ICTI CARE Process www.icti-care.org
Sustainable Apparel Coalition www.apparelcoalition.org
Public-Private Alliance for Responsible Minerals Trade (PPA) www.resolv.org/site-ppa
SA8000 www.sa-intl.org/sa8000
Sustainable Trade Initiative (IDH) www.idhsustainabletrade.com
UN Global Compact www.unglobalcompact.org
COMPANY OWNERSHIP / DATA
IBISWorld www.ibisworld.com.au/car
Hoovers www.hoovers.com
Limitations to the Guide

In making this guide both concise and practical we offer a somewhat simplified version of what is a complex web of company ownership, assessments and related issues. Please view this website as a starting place in developing a greater understanding of the connections between how we act and its effect on the world around us.

Some considerations:

  • The company ratings indicate criticisms and/or praises in one or more issue areas in the ownership tree, but not all areas. For most product types there are usually a variety of connected issues that individuals will weight differently according to their own priorities and concerns. For example, it would not be correct to assume a clothing company has a good track record in the area of workers rights simply because it receives a positive rating (it may be for something like using exclusively organic fibre). A common misconception is that the guide indicates ‘good’ or ‘bad’, ‘ethical’ or ‘unethical’, companies. In reality companies are ‘more ethical’ or ‘less ethical’ in particular areas depending on what criteria are being focused on. The simplified nature of our ratings system does not adequately reflect this, and is intended as a first-step way to apply the information.
  • There is little or no transparency on the conditions behind common processes in most supply chains in many industries. Although having ‘no information’ implies minimal standards are in place, we have not treated ‘no information’ as a ‘criticism’.
  • You may note that some large companies tend to rate well given the sources and methodology used. This may be because some sources focus only on large companies or larger companies have more resources to put into sustainability reporting and policy. It could also be that there is limited information available on smaller companies.

It seems unfortunate that a company is seen as ‘outstanding’ because it has commitment to be free from genetically engineered ingredients, or refrains from animal testing, or has made a voluntary agreement to minimise packaging waste. All these things should be normal practice for business however the reality is that these things are often secondary to profit. Common business operation is based on reducing expenses by every possible means which for the most part involves exploitation of our planet, its people, and each of us as consumers.

Let us redefine what can be considered ‘acceptable’ and raise the bar by holding companies to account and so encouraging company responsibility.