S&P Dow Jones Indices Launches S&P/Drucker Institute Corporate Effectiveness Index
New Index Tracks S&P 500 Companies that Consistently Rank Highly on Management Quality
S&P Dow Jones Indices (“S&P DJI”), the world’s leading index provider, today announced the launch of the S&P/Drucker Institute Corporate Effectiveness Index. The index is designed to capture the non-financial aspects of corporate performance that investors consider important “intangibles” in revealing a company’s management stability and overall health.
This new index utilizes the principles pioneered by the late Peter Drucker, the highly respected management author, educator and consultant. It selects the 100 companies from the S&P 500® that rank highest in excellence and consistency in creating and sustaining value based on factors reflected in the index’s methodology.
The benchmark combines the Drucker Institute’s corporate effectiveness score that quantifies company performance in the five management factors with S&P’s Quality Score, which measures its financial strength. The Wall Street Journal annual “Management Top 250” ranking is based on the Drucker Institute’s data and model.
“While the market has mastered the art of assessing short-term financial performance, long-term success is built on effective management – a factor that is much more difficult to measure,” said Zachary First, Executive Director at the Drucker Institute.“The S&P/Drucker Institute Corporate Effectiveness Index aims to identify companies that rate highest in four non-financial factors—customer relationships, workforce engagement and development, innovation, and societal contributions—along with financial integrity. We believe companies that outperform in these areas are best positioned for both short-term performance and long-term potential.”
“The S&P/Drucker Institute Corporate Effectiveness Index takes a broad view of sustainability,”said Reid Steadman, Head of ESG Indices at S&P Dow Jones Indices.“By looking at the full assessment of quality alongside the intangibles of good management, the index can help identify the companies well-equipped to extend their short-term successes into the future.”
For the full methodology and factsheet of the S&P/Drucker Institute Corporate Effectiveness Index, visit www.spdji.com.