Sunday, December 22, 2024
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These Fortune 500 companies earn top marks for leadership

This week, we unveiled the 69th edition of the Fortune 500 list. The top slot once again went to Walmart, followed by Amazon and ExxonMobil. The Fortune 500 as a whole generated record revenue of $18 trillion, up 13% from a year ago.

Big business continues to hum along despite the Federal Reserve’s interest rate hikes. However, how are they doing in terms of purpose and leadership? 

For the third year in a row, Fortune partnered with Indiggo to publish the ROL100 Ranking. The ROL100™ is a unique ranking that captures the Return On Leadership® of the top 100 companies in the Fortune 500. Return On Leadership® (ROL®) is a metric that drives and measures key components vital to activating and maintaining the momentum of change for today’s leaders.

To calculate the ROL100 Ranking, Indiggo leverages the framework from its AI platform together with publicly available information to provide an “outside-in” view of Return On Leadership. 

The numbers to know 

1

$155,469

  • … the EBITDA per employee of companies in the top 25 of the ROL100. While the EBITDA of companies in the bottom 25 of the ranking is $36,810.

80%

8

  • … the number of the healthcare companies in the top 25 of the ROL100. That’s the most of any sector. 

Big picture

There’s a positive correlation between financial success and purpose-driven leadership. Top ranked ROL100 companies outperform lower ranked companies in terms of revenue, profit, and growth.

A few deeper takeaways

Microsoft is winning on many fronts.

Year to date, Microsoft’s stock price is up 39% as investors come to the realization that the Seattle-based software and cloud computing giant is going to make serious noise in the AI space. For evidence, just look at the Bing AI chatbot. 

Microsoft also once again took the top spot in the ROL100 ranking (see chart above).

The reason being? Microsoft CEO Satya Nadella has put purpose at the forefront of their business, according to Indiggo’s data. In particular, Microsoft received the No. 2 rank for “purpose”, the No. 3 rank for “strategy”, and the No. 4 rank for “alignment.” 

It pays to have forward-thinking leadership. 

For the third straight year, the EBITDA per employee of companies in the top 25 of the ROL100 is more than double that of companies in the bottom 25 of the list. 

That speaks to the value of the ROL100 ranking—especially when considering financial metrics like EBITDA aren’t used in the methodology.

Healthcare companies rank high.

Among the companies that cracked the top 25 of the ROL100, eight are in the healthcare business. While the bottom 25 doesn’t include any healthcare companies. At the opposite end of the spectrum is the financial industry. Among the top 25 companies in ROL100 ranking, zero are in the financial services sector.

*Methodology: The ROL100 ranking uses publicly available information to assess Return on Leadership scores for the top 100 companies on the 2023 Fortune 500 list. Return on Leadership measures an organization’s capacity for execution through its leaders and managers, based on four fundamental drivers: Connection to Purpose, Strategic Clarity, Leadership Alignment, and Focused Action. For each fundamental, a mix of three to five key indicators is assessed (16 in all) to determine the overall ROL score and ranking for each company. For more details, go here

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