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Most Environmentally and Socially 

Controversial Companies in 

May 2009 

Zurich, June 11, 2009 / Charlotte Mansson 

According to the reputational risk radar RepRisk, the top ten most environmentally and socially 

controversial companies in May 2009 were: BP, Exxon Mobil, Shell, Chevron, Wal-Mart Stores, Barrick 

Gold, KBR Inc, RBS, Bertin Ltda, and Nestle. Companies on the list have been severely criticized by the 

world’s media, governmental organizations and NGOs for issues including human rights abuses, severe 

environmental violations, impacts on local communities, corruption and bribery, and breaches of labor, 

and health and safety standards. Rankings are based on the Reputational Risk Index (RRI), as measured by 

RepRisk in May of this year. The RRI is directly derived from the negative press captured by RepRisk and its 

calculation is strictly rule-based. 

RepRisk does not measure a firm's overall reputation. Instead, by capturing criticism, RepRisk computes a 

firm's exposure to controversy and therefore provides an indicator for reputational risk. RepRisk is used by 

asset owners and asset managers, commercial and investment bankers, supply chain managers, and 

corporate responsibility experts. 

BP 

Exxon Mobil 

Shell 

Chevron 

Wal-Mart 

Barrick Gold 

KBR 

RBS 

Bertin Ltda 

Nestle 

40 60 

80 100 

Top ten most criticized and 

controversial companies in 

May 2009 

The three environmental and 

social issues for which the ten 

companies were criticized most 

were: 

1. Impacts on 

Ecosystems/Landscapes 

2. Impacts on Communities 

3. Local Pollution 

© ECOFACT AG 2009, all rights reserved RepRisk® is a registered trademark of ECOFACT AG Page 1 of 9

The RRI ranges from zero (lowest) to 100 (highest) and its calculation is based on the reach of news 

sources, the frequency and timing of news, as well as its content, i.e. severity and novelty of the issues 

addressed. The RRI is an indicator of a company's exposure to controversial issues and allows an initial 

assessment of risks which are attached to investments and business relationships. It also allows the 

exposure of an entity to be compared with that of its peers and permits risk trends to be tracked over 

time. 

The following pages provide a summary of the criticism to which the ten most controversial companies 

have been exposed, as well as the environmental and social issues that have been associated with these 

companies. The company’s ranking from the previous month is shown in brackets. 

In addition to the regular top ten list, this month’s focus area will be on the Mining industry and its top 

five most environmentally and socially controversial companies. 

Please refer to page 9 for more details on methodology. 


BP Plc, Rank 1 [8] 

A large majority of shareholders from BP PLC have voted against the 2008 pay packages put forward at 

the annual meeting, claiming they are excessive. WWF criticized BP, Exxon and Rosneft for refusing to 

join an advisory panel formed by the International Union for the Conservation of Nature in response to 

the potential impacts of oil and gas development on Gray Whale populations in Russian waters. BP came 

under fire as it proposed to expand its Whiting Refinery in Michigan, which has been releasing 

dangerous levels of cancer-causing benzene for the past six years. The US Environmental Protection 

Agency (EPA) has cited BP America for breaches of the Clean Air Act at the Whiting refinery. 

Top three issues: 

1. Impact on Ecosystems/Landscapes 



Exxon Mobil, Rank 2 [12] 

Exxon Mobil Corp was sued over charges that it has allegedly let millions of liters of crude oil seep into 

the earth below Brooklyn, New York, since 1947 and did not do enough to mitigate the situation. A 

separate lawsuit filed by the Louisiana Environmental Action Network (LEAN) alleges that over the past 

12 months Exxon Mobil's Baton Rouge chemical plant has, on at least 66 occasions, released pollution in 

excess of its air permit. In another incident, a US District Court Judge has ordered Exxon Mobil Pipeline, a 

subsidiary of Exxon Mobil, to pay USD 6.1 million in fines for violating the Clean Water Act in relation to 

an incident at its Everett, Massachusetts oil terminal. Fifteen thousand gallons of low-sulfur diesel and 

kerosene spilled into the Mystic and Island End rivers. ExxonMobil has also come under fire for exploiting 

Canadian tar sands using a highly polluting and carbon intensive process, which destroys boreal forests 

and accelerates climate change. It has been named the worst oil company on Green America’s 

Responsible Shopper Website. 


1. Impacts on Ecosystems/Landscapes 




Royal Dutch Shell, Rank 3 [4] 

Shareholders and environmentalists from the ShellGuilty campaign voiced their anger about Royal Dutch 

Shell's track record of alleged polluting, human rights violations and, recently, excessive executive pay 

despite the company's failure to meet pre-set targets. Campaigners claim the company's activities in 

Nigeria have caused severe oil spills in the Niger Delta region, the poisoning of communities through gas 

flaring, the emission of huge amounts of greenhouse gases, and the wasting of approximately USD 2.5 

billion of natural gas annually. Along with facing a trial in the Netherlands over pollution allegations in 

Nigeria, Shell will also stand trial in New York for alleged collusion in human rights abuses dating back to 

the 1995 hanging of a writer and eight other activists. Sixty percent of Shell's shareholders rejected the 

plan to pay executives millions of pounds after not meetingperformance metrics, and Shell’s CEO will 

step down in June amidst accusations that the company is the most polluting in the oil sector and 

shareholder criticism over executive greed. 


1. Impacts on 




Chevron, Rank 4 [5] 

Chevron is facing USD 27 billion in potential damages in one of the world’s largest environmental 

lawsuits in relation to its oil operations in Ecuador. The company has been blamed for increased cancer 

rates amongst local residents, severe damage to the environment and the degradation ofwater sources 

through oil contamination, pollution, and improperly treated waste. Shareholders voiced their concern 

over the effect the lawsuit might have on share prices. 


1. Impact on 


2. Impacts on 

Communities 

3. Human Rights Abuses 

and Corporate Complicity 


Wal-Mart Stores, Rank 5 [2] 

Wal-Mart was mentioned as one of the retailers that sources beef products from companies which 

allegedly contribute to Amazon rainforest destruction and global warming. Greenpeace claims that these 

producers expand into the Amazonian rainforest and log and operate illegally, occupy natives' land, and 

practice modern-day slave labor. Wal-Mart was also accused of sourcing fish products from 

unsustainable suppliers. 


1. Poor Employment 

Conditions 

2. Supply Chain (E, S, L 

Issues) 

3. Human Rights Abuses 

and Corporate 

Complicity 

Barrick Gold, Rank 6 [20] 

A major toxic spill has been reported at Barrick Gold's Mara Mine in Tanzania. The spill has allegedly 

contaminated the river Thigithe, which flows into the nearby Mara River, with hazardous sludge. Barrick 

Gold's Pascua-Lama Project was criticized by community leaders and legal experts from Chile and 

Argentina who denounced the project as illegal and lacking the social license to operate. The leaders 

claim it violates human rights guaranteed by the international and national system of law by ignoring the 

wishes of indigenous land owners affected by the project. NGO MiningWatch Canada made an urgent 

appeal to the United Nations Special Rapporteurs regarding alleged human rights violations at Barrick’s 

Porgera Gold Mine in Papua New Guinea, claiming that the indigenous landowners were beaten by 

security forces supported by Barrick Gold. 


1. Impacts on 

Communities 

2. Impacts on 




KBR., Rank 7 [120] 

KBR has been embroiled in a large corruption scandal in which it was accused of paying USD 180 million 

to officials to secure contracts for the Bonny Island Liquefied Natural Gas terminal in Nigeria. KBR is now 

being sued by a number of investment funds who claim that mismanagement and corruption by 

company employees have had serious financial ramifications for shareholders. In addition to the 

corruption charges, KBR is also under investigation for the electrocution of two soldiers in Iraq, as well as 

for overcharging the US government by millions of dollars. 


1. Corruption, Bribery, 

Extortion, and Money 

Laundering 

2. Violation of National 

Legislation 

3. Health and Safety 

Issues 

Royal Bank of Scotland, Rank 8 [13] 

RBS has been heavily criticized for its executive compensation scheme and bonus payments, in light of 

the bank being partly taken over by the UK government and receiving millions of pounds in bail-out 

money. Outrage was so strong that shareholders rejected the new pay proposals with a 90.42 % 

majority, marking the first time that the bank has lost a vote in the remuneration process. In addition, 

RBS also came under fire for its investment in controversial conflict areas such as Uganda and the 

Democratic Republic of Congo, as well as investing in oil exploration companies operating in areas of 

pristine nature such as Greenland. 


1. Global Pollution (Including Climate 

Change) 


3. Executive Compensation Issues 


Bertin Ltda., Rank 9 [New Entry] 

Bertin was accused of contributing to climate change and rainforest destruction by clearing Brazilian 

rainforests in order to make way for cattle production. NGO investigations found that Bertin, which is 

part-owned by the Brazilian government, sources cattle from farms that have allegedly carried out illegal 

deforestation. 



2. Global Pollution (Including Climate 

Change) 

3. Supply Chain (E, S, L Issues) 

Nestle SA, Rank 10 [6] 

Nestle was accused of trying to control rural and community water resources. NGOs claim the company 

used costly legal battles and public relations campaigns that communities could not compete with, 

negotiated directly with officials rather than with the affected communities, avoided required 

environmental reviews and exceeded water extraction limits. In addition, several NGOs claimed that 

Nestle continues to buy most of its cocoa from Ghana and the Ivory Coast despite alleged ongoing 

forced and child labor practices in those countries. 




3. Overuse and Wasting of Resources 


Most Environmentally and Socially Controversial Companies May 2009: Mining 

Top Five Companies: 

1. Barrick Gold 

2. Rio Tinto 

3. Xstrata 

4. Vedanta Resources 

Top Three Issues: 



3. Human Rights Abuses and Corporate 

Complicity 

5. Frasure Creek Mining 

Barrick Gold, Rank 1 

Please refer to Most Controversial Companies section of report, Rank 6. 

Rio Tinto, Rank 2 

At Rio Tinto's annual meeting in London shareholders heavily criticized the company’s practice of dumping 

waste minerals and chemicals directly into rivers at the Grasberg Gold Mine in Indonesia, a practice that has 

resulted in the company being expelled from several funds. NGOs allege that severe human rights violations 

have taken place at Muriel Mining Corporation's Mande Norte mining exploration site, which Rio Tinto is also 

involved in. A lawsuit under the Alien Tort Statute has been brought against Rio Tinto for alleged human rights 

abuses in Papua New Guinea. 

Xstrata, Rank 3 

Xstrata's Mount Isa Mine in northwest Queensland, Australia was labeled as one of the country’s biggest 

polluters on the National Pollutant Inventory. Several families are currently suing Xstrata, claiming their children 

have been poisoned through its mining activities. A third of Xstrata shareholders voted against the company’s 

remuneration report as investors are believed to be angry about the company’s plans to increase pay and issue 

bonuses despite a 35% fall in earnings last year. 

Vedanta Resources, Rank 4 

Vedanta was granted approval by the Indian Government for its controversial bauxite mine on the Niyamgiri 

mountain in Orissa, despite fierce local tribal opposition. Locals and NGOs claim the mine will destroy large 

amounts of forest, pollute rivers and have other impacts on the tribe. Vedanta was also accused of money 

laundering and tax evasion in relation to its Sterlite subsidiary. 

Frasure Creek Mining, Rank 5 

The Sierra Club urged that action be taken to protect the Robinson Forest in the US from a strip mining project 

proposal by Frasure Creek Mining. The mining activities would allegedly destroy native forest, which is home 

to endangered animal and plant species 


Methodology 

RepRisk objectively monitors the level of criticism to which a company is exposed. All data is collected and 

processed by a strictly rule-based approach; it is not the result of an assessment, rating or verdict from our 

analysts. 

The "Most Environmentally and Socially Controversial Companies" report was compiled using information 

from the RepRisk database, which consists of negative news on companies’ environmental and social 

performance. The RepRisk database currently covers more than 9,000 companies and holds news from 

thousands of sources, ranging from commercial newspapers and on-line media to NGO websites, blogs 

and newsletters. Once the negative news has been identified with advanced search algorithms and 

analyzed for its novelty, relevance and severity, risk analysts enter it into the database and link it to the 

companies in question. No news is entered twice unless it has been escalated to a more influential source 

or higher-profile media outlet. This helps to ensure the balanced and objective rating and weighting of 

the negative news, and thus the company’s RRI. The RRI measures the risk to a company’s reputation, not 

its actual reputation in general. Each report is compiled by taking the ten most criticized companies in our 

database of more than 10,000 companies. 

For more information about the "Most Environmentally and Socially Controversial Companies" report, 

please contact Charlotte Mansson at mansson@ecofact.com, tel: +41 44 350 6022, or visit our websites: 

www.reprisk.com or www.ecofact.com. 

RepRisk® 

RepRisk is a web-based tool that provides insights into environmental and social issues that present financial 

and reputational risks to a bank, company, or investment portfolio. It facilitates the identification and 

assessment of controversial issues associated with specific companies and business relationships. 

RepRisk's assessment of the environmental and social performance of a company is based on the company's 

activities in the field as observed by independent third parties, and is not derived from information provided by 

the company itself. 

Every day, RepRisk captures the reactions of print media, more than 650 NGO websites and newsletters, news 

websites, blogs and other online sources on controversial issues relevant to financial institutions, other 

companies, and projects. 

RepRisk covers controversial issues ranging from employee and community relations to resource availability and 

efficiency, environmental footprint and product portfolio-related risks. In particular, it addresses all of the 

principles of the UN Global Compact. 

ECOFACT 

ECOFACT is a leading provider of reputational, environmental and social risk management solutions in the 

financial industry. ECOFACT is based in Zurich and leverages a global network of sector and issue specialists. 

Our client base consists of asset managers, pension funds, commercial and investment banks, the leading 

development banks, insurance companies, and governmental agencies. 

ECOFACT AG was founded in 1998 as a spin-off from a leading Swiss bank and is a fully independent 

corporation.

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