Methodology: how does the list come together?
The Global Cleantech 100 is designed to achieve two unique things to make it distinctive from other lists: to give fair representation to global innovation and private company creation, and to represent not Cleantech Group’s editorial voice and opinion, but that of hundreds of people within the wider global cleantech innovation community.
The question we are seeking to answer is:
According to the world’s cleantech community, which 100 of today’s private cleantech companies are the most likely to make the most significant market impact over the next 5-10 years?
The answer is derived by Cleantech Group drawing on its own data and research, and
combining it with the weighted qualitative judgments of hundreds of people, and the viewpoints of an expert panel. To be on the list, companies must be independent, for-profit, cleantech companies that are not listed on any major stock exchange.
The process we run is analogous to that of a two-stage presidential election, or a reality TV show, using a combination of wider input and narrow expert judging. The process runs in two stages.
Phase 1
During phase 1, a long list is built from both active nominations made by hundreds of worldwide experts Cleantech Group reaches every week through its online and offline media, and from passive nominations and validations. The latter are derived from analyzing a wealth of market data, taking ‘votes of confidence’ in a company’s ability to achieve high growth and high market impact from market transactions such as investment rounds, and major customer and partnership announcements, as well as leveraging the results of over 130 (up from 50 in 2010) third party awards and rankings, where expert assessment has already been applied, with criteria relevant to the question we are asking.
In this way, in 2011, 6,652 nominations were received (an increase of 2,036 from 2010), giving us a long list of 4,274 companies (a 36% increase on 2010). A weighting and filter system was then applied to collate the results, score each company, and reduce the candidates to a short-list of 213 companies to present to the expert panel in phase 2.
The scoring system rewards companies who have multiple validations, to align with our objective to synthesize and represent collective opinion. Another key objective is to produce a Global Cleantech 100 that truly represents the breadth of cleantech innovation companies, from Agriculture to Wind, from California to China. To counter geographical and sectoral bias, a weighting system is used to keep the list within general bands, so that the end list cannot be all solar or renewable companies, or all American or European companies, for example. Geographies and sectors are weighted by their proportionality in cleantech. The weightings used are derived from Cleantech Group data on the number of companies of the global total that any particular geography or sub-sector represents.
Phase 2
In phase 2, members of an expert panel are each given a limited number of votes they can use to voice a strong opinion, be that positive or negative, to strengthen or weaken a shortlisted company’s case for making the final 100. The scores from phase 1 are carried through, so the end result is a combination of the two. At all points, voting is blind and remote, meaning expert panellists, do not know where any one company is ranked after phase 1, or what other expert panellists are doing or saying. This is to counter tactical voting and to prevent anyone being unduly influenced by others, which we have witnessed happening in physically-convened panels and editorial meetings.
The expert panel is made up of 70 individuals, drawn principally from leading investors in Asia, Europe and North America, and from representatives of multi-nationals from a deliberately-varied (and balanced) set of industrial backgrounds. It includes pioneers, leaders, rising stars, and new entrants in cleantech.
The composition of the expert panel, in alignment with our weighting system, is created to be broadly representative of the global cleantech community, reinforcing the intended outcome that the end result should be a list in which all, or most, sub-sectors of cleantech are represented, and many countries have the chance to be represented, in approximate proportionality to their share of the overall number of innovative, private cleantech companies in the world.
A core principle of the approach throughout is to counter commercial bias by forcing participants to nominate companies where they are not a stakeholder. For every company anyone nominates that they have an association with, they must nominate two others where they do not, but which they admire. For example, an investor’s input was only accepted if, for every portfolio company they put forward, they also nominated at least two others where they are not shareholders. We call this the ‘Lust List’ principle.
The end result is a list of companies that command a broad base of respect and support from many players within the global cleantech innovation ecosystem, not just insiders. Clearly, there are many, fine companies who are not on the 2011 list. They may be waiting to be discovered by a broader pool of people, they may be out of favor this year, their time is still to come (or to come again, in the case of those who have fallen off from the 2009 or 2010 lists); or they may simply have just missed the cut. Only so many companies can be on the list.