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The Sustainable Management Rating Institute (SMRI) of Japan, an environmental rating body created through the collaboration of businesses and academic researchers, presented its second round of rating results on February 26, 2004, following its first round released last year. The ratings for the 67 Japanese companies that cooperated with the entire rating process were shown in the form of "Rating Trees."

A Rating Tree has 63 leaves, shown either as green, yellow or red leaves on the tree, or as leaves fallen onto the ground. Each leaf represents one rating item, which involves three questions. If the answer to all three questions is "yes," the corresponding leaf is colored green; two "yes" answers means yellow; one "yes" means red; and no "yes" answers means a fallen leaf.

Thus, the strengths and weaknesses of a target company can be seen at a glance. This scheme was developed to give a visual indication of a company's current sustainable management status to the public, including local residents and new employees.

To accomplish the task of rating, SMRI committee members conduct a hearing, a sustainability dialogue, and an interview with the top management of the subject company, addressing three areas - management, environment and society. All of the approximately 90 committee members do this work as volunteers.

Scores are expressed as percentages, and in the area of management have risen dramatically, from 85.3 last year to 94.1 this year. This shows that the 2003 rating exercise contributed to improvements in each company's performance.

SMRI's policy is not to reveal its rankings since it believes that "What is important for companies is to take an attitude of pursuing continuous improvement, not one that seeks relative positioning." The organization hopes that the scheme will contribute to the establishment of an innovative business model by encouraging not only environmentally conscious companies but a wider range of other companies to actively take part in the rating scheme.