Sustainability or in Thai, sustainability. If we translate it directly, sustainability means the ability to endure or remain. Why are many organizations or even people in society turning to give importance to sustainability?
Because in this era, the context of doing business has changed. The world of competition has changed rapidly. In addition, most companies in the past until now have focused on expanding their business, focusing only on profits. Doing this has an impact on the environment, creating problems with waste, creating problems with air quality, causing resources to become less and less, and creating many other problems such as social issues. If the situation is allowed to continue like this, it will definitely not be good.
For this reason, organizations and companies need to change their mindset from growth that focuses on only financial results to sustainable growth or setting goals for developing the organization towards sustainability.
In our country, the same thing has happened in the past 10 years. Sustainability has become something that many organizations are giving importance to. This can be seen from the emergence of standards for evaluating business operations in line with sustainable development guidelines to be used to measure the sustainability of organizations or companies.
The Dow Jones Sustainability Indices (DJSI) is another index used to evaluate the effectiveness of a company’s business operations in line with sustainable development. DJSI is an index that is accepted worldwide, perhaps because it is an international standard and transparent. This is why many companies want to become members of DJSI.
What are the principles or criteria used for evaluation of the Dow Jones Sustainability Indices (DJSI)?
The Dow Jones Sustainability Index is primarily assessed in three areas:
- Environment : Caring for and maintaining the environment, such as in business, we must focus on environmentally friendly production, use energy efficiently, and not harm the environment, etc.
- Social : Social care, such as in business, must give importance to stakeholders, such as employees, must receive continuous training and development, or develop business partners to grow together, or provide support for employment for communities living around the company, etc.
- Governance : Having good business governance, such as in doing business, it is necessary to manage risks in every department and conduct business according to the principles of good governance, taking into account fairness, responsibility, honesty and transparent business operations, etc.
In addition, DJSI also considers the assessment of business stability, such as income, profits, and many other important factors. Each year, DJSI selects companies from around the world to assess business sustainability. Most recently, in 2020, there were 3,429 companies from around the world that were assessed. They will consider market capitalization and sustainability performance to select only companies that are outstanding in terms of sustainable business operations to become members of the DJSI group.
DJSI uses different sustainability measures of companies according to the industry or type of business operations. Currently (referring to the latest 2020) it is divided into 61 types of industries, separated by region or world geography, such as indexes for Europe, America, Asia-Pacific, developing economies and country levels, etc.
Why Dow Jones Sustainability Indices (DJSI) Matter to Companies and Why Do Companies Worldwide Want to Participate in the Assessment?
By joining DJSI, companies will know how their company or organization can improve or change its work processes to be as efficient as or better than the world’s leading organizations. Being a member will make us have to continuously develop our organization, our people, and other departments in order to maintain our high-ranking membership status or even become an industry leader.
Another important thing is that being a member of DJSI is an investment option for investors around the world. This is because investors or funds around the world use the Dow Jones Sustainability Index as an important criterion for considering and selecting to invest in those companies. If any company is ranked in DJSI, it is a guarantee of the potential for management or business operations, that this company will be able to create good and sustainable returns for investors, etc.
Thailand is no ordinary country. We are also considered a country with a large number of companies that are DJSI members.
As of 2020 , 22 Thai companies have been selected as members of the Dow Jones Sustainability Indices (DJSI), but that’s not as exciting as the 8 Thai companies that have emerged as Industrial Leaders, as follows:
- Banpu Public Company Limited (BANPU), the leader in the Coal & Consumable Fuels industry group.
- PTT Oil and Retail Public Company Limited (TOP), the leader in the Oil & Gas Refining & Marketing industry group.
- PTT Public Company Limited (PTT), the leader in the Oil & Gas Upstream & Integrated industry group.
- Thai Beverage Public Company Limited (THBEV), the leader in the Beverages industry group
- PTT Global Chemical Public Company Limited (PTTGC), the leader in the Chemicals industry group
- Siam Cement Public Company Limited (SCC), the leader in the Construction Materials industry group
- True Corporation Plc. (TRUE), the leader in the Telecommunication Services industry group
- BTS Group Holdings Public Company Limited (BTS), the leader in the Transportation and Transportation Infrastructure industry.
There are 22 Thai companies selected as DJSI members in 2020 as follows:
The DJSI World Index consists of 12 companies: KBANK, SCB, PTTEP, PTT, CPALL, THBEV, IVL, PTTGC, SCC, CPN, ADVANC and AOT. The index in this group is selected from the world’s top 2,500 companies by market capitalization.
The DJSI Emerging Markets Index group for emerging markets consists of 22 companies: KBANK, SCB, MINT, BANPU, IRPC, PTTEP, PTT, TOP, CPALL, CPF, THBEV, TU, IVL, PTTGC, SCC, CPN, HMPRO, ADVANC TRUE, AOT, BTS and EGCO.
And it is a good opportunity for the admin to have the opportunity to interview some executives from the group of companies that have become leaders in the industrial sector (Industrial Leader). Follow us soon.
More: Why we need to be sustainable? Follow the story of business sustainability in 2021 with this short video now.
