Alliance News | 3rd Annual SV 99 Rankings Published

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Author:CASVI

On Sept 20, 2019, CASVI published its 3rd annual A-Share Listed Company Sustainable Development Contributions Rankings, China "Social Value 99", or "SV 99". For the full list, please refer to the attachment at the end of the article.


This year, Hangzhou HikVision tops the chart, with China State Construction Engineering and Zijin Mining following in the second and third place. The list’s Top 10 also includes Agricultural Bank of China, China Yangtze Power, China United Network Communications, BOE, China Shenhua Energy, China Vanke and China Petrochemical.


SV 99, or SV 99 Companies, refers to China’s top 99 A-share listed companies based on their Sustainable Development Contributions. The ranking is created on the basis of quantified assessment of the comprehensive economic, social and environmental performances of selected CSI 300 constituent companies using the Assessment Model for Sustainable Development Contributions for Listed Companies.


SV 99 Continues to Maintain High Economic, Social and Environmental Contributions


Analysis of SV 99’s Doing Well and Doing Good (DW & DG) properties reveal that the listed companies on the rankings continues to maintain high economic, social and environmental contributions.


To unveil the SV 99’s features in DW and DG, these companies are categorized into four groups according to the assessment of their performance in terms of economy, society and environment: i) Companies excel in pursuit of both DW & DG; ii) Companies register outstanding DW performance; iii) Companies stand out in DG performance; iv) Companies feature balanced performance in DW & DG.


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2019 SV99 DW&DG Characteristics (Market Value)


This year, 11 companies have excelled in pursuit of both DW and DG, such as Hangzhou HikVision (002415.SZ), China State Construction Engineering (601668.SH) and Agricultural Bank of China (601288.SH). This number is down by 12 compared to June 2018.


38 companies stand out in their DW performance, including China Yangtze Power (600900.SH), China Shenhua Energy (601088.SH), and China Petrochemical (600028.SH), up by 10 compared to last June.


26 companies feature balanced performance in DW & DG, up by 5 over last year, including TCL (000100.SZ), Lomon Billions (002601.SZ) and Dahua Technology (002236.SZ).

Last but not least, 24 companies achieve outstanding performance in DG, down by 3 compared to previous year, including Zijin Mining (601899.SH), China UniCom (600050.SH) and BOE (000725.SZ).


Looking at the total SV scores across 3 years, listed companies in 2019 have achieved an increase compared to 2017. However, although 2019 first-ranking HikVision outperform 2018’s first-ranking China State Construction Engineering by 3.02 points, the “head”, or also known as the leading companies this year achieve relatively less points than that of last year.


Over the 3 years, economic contribution scoring rate decreases, while social contribution scoring rate varies from high to low, and environmental scoring rate has little variation.


SV 99 Outperforms CSI 300 in Scoring Rate


Comparing SV 99 and CSI 300’s Economic Contribution Scoring Rate.png

Comparing SV 99 and CSI 300’s Economic Contribution Scoring Rate


In terms of DW performance, SV 99 has, 3 years in a row, outperformed CSI 300 over the 5 financial indicators (Profitability, Operation Efficiency, Solvency, Growth Capability and Financial Contribution). Among which, SV 99 displays the most advantage over Financial Contribution, scoring 11.72% more than their CSI 300 counterparts.


Comparing SV 99 and CSI 300’s Social Contribution Scoring Rate.png

Comparing SV 99 and CSI 300’s Social Contribution Scoring Rate


Looking at DG performance, SV 99 scores more than CSI 300 counterparts in all tier-three indicators for social and environmental contribution. Social contribution consists of evaluation of the listed company’s performance in its’ Value to Customers and Users, Employee’s Rights and Interests, Operation Safety, Business Partnership and Contribution to Public Good, and SV 99 scores on average 10% more than CSI 300 counterparts over these 5 indicators.


Comparing SV 99 and CSI 300’s Environmental Contribution Scoring Rate.png

Comparing SV 99 and CSI 300’s Environmental Contribution Scoring Rate


For environmental contribution, it is assessed based on Environmental Management, Pollution Prevention and Control and Ecological Climate. Both SV 99 and CSI 300 performed best in terms of Pollution Prevention and Control, although there is still a 21.40% difference in scoring rate with SV 99 achieving 71.40% and CSI 300 49.99%.   


Higher Scores Comes with More Effective Information Disclosure


For both 2018 and 2019, SV 99 achieves a higher level of data completeness than CSI 300 counterparts, in terms of both tier-two indicators and industry analysis. A high level of data completeness should be a basic characteristic for listed companies.


In 2019, the Energy sector has the highest data completeness across different CSI 300 industries, and it also has the highest mean total score, 63.58 points, for sustainable development value across the 11 industries. 7 out of the 10 energy-related companies made it to the ranking, making it the sector with the highest rate of getting on to the ranking, at 70%. The industry with the lowest data completeness is Real Estate, at 65.65%. It has a mean total score of 51.32 points for sustainable development value, ranked last in 11 industries and the rate of companies in this sector getting on to the ranking is the lowest, at 13.33%. From here we can see that there is a positive relationship between data completement and sustainable development value.


From the results of the regression analysis, we can see that there is a significant positive correlation between the level of data completeness and the score of sustainable development value of listed companies. For every 1% increase in data completeness, the score of sustainable development value increases by about 0.78 points. Therefore, the more effective the information disclosure of listed companies are, it is more likely for their sustainable development value scores to be higher.


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A comparison of HikVision’s 2018 and 2019 Data Completeness and Scoring Rate

2019’s first ranking HikVision ranked only 64 last year. The data completeness for its tier-two indicators in Value Driven, Technological Innovation and Economic Contribution are all 100% for both 2018 and 2019, while the data completeness for other tier-two indicators have all increased, with a significant increase in scoring rate.   


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