What does the Dow Jones Sustainability Index primarily evaluate?

The Dow Jones Sustainability Index is a prominent benchmark that specifically assesses companies based on their sustainability performance. This index evaluates a range of criteria related to environmental, social, and governance (ESG) practices. It highlights how well companies manage their operational impacts on the environment and society, which can include factors like resource conservation, social responsibility, and corporate governance practices.

By focusing on sustainability performance, the index encourages companies to enhance their practices in these areas and provides investors with insights into firms that are committed to sustainable development. This evaluation does not primarily focus on traditional financial metrics like profitability, product quality, or growth potential, but rather on how these companies contribute to sustainable growth and responsible business practices. Thus, the emphasis on sustainability performance distinguishes the Dow Jones Sustainability Index from traditional performance metrics that evaluate profitability or market share.