EDF and Centrica rank highest in the Tomorrow’s Value Rating of the world’s 10 largest energy utilities.

EDF and Centrica hold a comfortable lead over their competitors in the Rating. In particular, EDF stands out for demonstrating responsible business practices across a large number of operating markets, from employee consultation panels in Latin America and Asia to rural electrification projects in Morocco and Mali. It is also one of the few companies to monitor supplier performance on sustainability issues.

Overall, the Rating finds that delivering affordable energy to consumers while responding to significant environmental and social concerns presents a tricky balancing act for energy utilities.

Thomas Krick, lead consultant for the Tomorrow’s Value Rating, explains: “Power generation causes a quarter of the world’s carbon emissions, as well as many other social and environmental impacts. At the same time, there are still 1.6 billion people in the world without reliable access to electricity. Sustainable solutions to this dilemma require significant long-term investments.”

Most of the 10 largest energy utilities covered by the study recognise the importance of sustainability, and particularly of social issues such as health and safety and human resource practices, and environmental issues such as climate change and energy security.

However, strategies to address climate change disclosed within the sector are characterised more by similarities than differences, which makes it difficult to point to a clear leader. There is an opportunity for one of these companies to break the mould and emerge as a leader in sustainable power generation.

Key challenges for energy utilities identified by the Tomorrow’s Value Rating

• Delivering on targets: Evidence that ‘responsible policies’ translate into actual performance improvement is rare.
• Global responsibility: Increased activity in less regulated or developed countries heightens the requirement for diligent local management of impacts.
• Supply chain: Promoting adherence to social and environmental principles amongst its supplier base in less regulated markets becomes increasingly important.
• Access to supply: Security of supply to disadvantaged customers and people living in remote areas.
• Bold vision: Given the absence of clear long term governmental guidance, planning security remains a challenge. Any company wanting to undertake long-term investments needs to take a brave bet on what the future might look like.

The companies assessed as part of this Tomorrow’s Value Rating were the 10 largest energy utility companies according to the Fortune Global 500 list, which ranks the world’s largest companies by revenue.

Results of the Tomorrow's Value Rating of the energy utilities sector