General Electric Co., the world’s biggest maker of power-generation equipment, led a ranking of U.S. companies based on their efforts to manage carbon emissions, fight global warming and profit on climate rules.
GE edged out Ford Motor Co., the second-biggest U.S. automaker, and Intel Corp., the world’s largest chipmaker, to take the top spot for a second year on the Climate Innovation Index U.S. 100, according to Maplecroft, the U.K. risk assessment company that calculates the measure. Billionaire investor Warren Buffett’s Berkshire Hathaway Inc. came in last.
Maplecroft rated the 100 largest public companies in the U.S. on 100 categories including their reduction of greenhouse gas emissions, use of new technologies, pursuit of climate-related opportunities and disclosure of environmental policies.
“Climate change is not just about managing risks and preparing for future regulations on carbon, but is also an opportunity to cut costs,” Dan Haglund, climate indexes project manager at Maplecroft, said in a telephone interview. “The companies doing the most in this regard will be the future financial winners.”
Fairfield, Connecticut-based GE, with products ranging from water heaters that cut domestic energy use to fuel-efficient aircraft engines, was also cited for setting a price on carbon emissions in some of its contracts.
Berkshire was rated low for its lack of disclosure on climate-change policies, Maplecroft said. Buffett assistant Carrie Kizer didn’t immediately respond to an e-mailed request for comment.
Buffett’s Rail Purchase
Buffett’s biggest acquisition, the $27 billion purchase of railroad Burlington Northern Santa Fe Corp., is a bet on the most efficient and “environmentally friendly” way of moving goods in the U.S., he told Charlie Rose in November. Berkshire’s MidAmerican Energy Holdings Co. owns hydroelectric plants in the U.S. Northwest and wind turbines in Iowa.
Berkshire Hathaway’s Class B shares have risen 26 percent this year, compared with a 23 percent gain for Ford shares and an 8 percent increase for General Electric stock. The Standard & Poor’s 100 Index rose 0.6 percent in the period.
Maplecroft surveyed the biggest U.S. companies by market capitalization as of Aug. 18 to craft the list. A wider ranking of more than 330 companies with market capitalizations of more than $1 billion also was headed by GE and Ford. Alcoa Inc., the largest U.S. aluminum producer, was ranked third on that list.
The risk assessor said it may start exchange-traded funds based on its Maplecroft Climate Innovation Index Benchmark. Constituents are weighted according to their ranking. GE now constitutes 2.45 percent of the U.S. 100 index, Ford accounts for 2.44 percent, and Intel is 2.22 percent.
The Climate Innovation Index U.S. 100 gained 1.7 percent for the nine months ending Sept. 30, compared with a 0.1 percent gain for the Standard & Poor’s 100 Index, a 3.5 percent rise in the Dow Jones Industrial Average and a decline of 16 percent in the WilderHill New Energy Global Innovation Index.
Maplecroft used publicly disclosed information such as company sustainability reports, and then contacted all companies with at least two follow-up emails, Haglund said. Berkshire didn’t respond, Haglund said.
“We found no evidence of any climate-related policies, management systems, or guidance on innovation promulgated by the Berkshire Hathaway holding company,” Maplecroft said in an e-mail. “The active investment strategy adopted by the company constitutes a great opportunity to influence companies in which Berkshire invests to respond, positively and proactively, to changing political and market sentiment around climate change.”