Companies From Emerging Markets Dominate Rankings of World’s Top Shareholder Value Creators, Says Report by The Boston Consulting Group

Top Ten Performers in BCG’s Annual Value Creators Rankings Are All Based in Asia–Five in China, Two in Hong Kong, and One Each in India, Indonesia, and South Korea

BOSTON, One side effect of the Great Recession has been to accelerate the ascent of companies from rapidly developing economies to the top ranks of the world’s creators of shareholder value, according to a new report by The Boston Consulting Group (BCG). This is the core finding of Threading the Needle: Value Creation in a Low-Growth Economy, the twelfth annual report in BCG’s Value Creators series.

Starting from a database of more than 4,000 companies worldwide, the report presents detailed analyses of the total shareholder return (TSR) at 712 companies across 14 major industries for the five-year period from 2005 through 2009. It also identifies the top ten value creators overall and in each of the industries studied. Among the key findings:

• Of the 142 companies included in this year’s global and industry rankings, 81 are located in developing economies — 57 percent of the total.
• Even more dramatic, the top ten value creators in the 712-company sample are all from Asia — five companies listed on stock exchanges in China, two in Hong Kong, and one each in India, Indonesia, and South Korea. (See the exhibit “The BCG Global Top Ten, 2005-2009.”)
• Seven of the top ten large-cap value creators (those with market valuations of more than $35 billion) are listed on stock exchanges in rapidly developing economies as well — Brazil, Hong Kong, India, Mexico, and South Korea.
• Of the 14 major industries covered by the report, only one – pharmaceuticals and medical technology — does not have any companies from emerging markets in its top ten.

“One of the consequences of the Great Recession is that we are now living in what BCG calls a ‘two-speed’ economy,” said coauthor Daniel Stelter, a senior partner in BCG’s Berlin office and the global leader of the firm’s Corporate Development practice. “Most developing economies are rebounding relatively quickly to their precrisis growth levels. In contrast, developed economies are entering an extended period of below-average growth — with profound implications for how companies create value and which companies come out on top.”

Trends in Value Creation

The report also discusses other findings from BCG’s analysis of this year’s Value Creators database.

• The average annual TSR for the 712 companies in the database was 6.6 percent — and in 3 of our 14 industry samples, TSR was actually negative, on average, during the past five years. This relatively poor performance (considerably below the long-term historical average of approximately 10 percent) reflects the precipitous decline in market values in late 2008 owing to the global financial crisis — a decline that the rebound in 2009 equity values only partly recovered.
• The big industry winner in this year’s rankings is the mining and materials sector, with a weighted average annual TSR of 18 percent. This performance is a function of the rise in commodity prices during the 2005-2009 time period, driven in part by rapid development in emerging markets. In second and third place are the chemicals industry and the machinery and construction industry.
• The leading companies in the sample substantially outpaced not only their own industry average but also the total sample average. For example, the average annual TSR of the global top ten — 75 percent — was more than 11 times greater than that of the sample as a whole. The top ten companies in each industry outpaced their industry averages by between 13.2 percentage points (in pulp and paper) and 34.5 percentage points (in machinery and construction). And in every industry we studied, the top ten companies also did substantially better than the overall sample average — by at least 6.6 percentage points of TSR.

“The lesson for executives is clear,” said coauthor Frank Plaschke, a partner in BCG’s Munich office. “Coming from a sector with below-average market performance is no excuse. No matter how bad an industry’s average performance is relative to other sectors and to the market as a whole, it is still possible for companies in that industry to deliver superior shareholder returns.”

The Impact of Low Growth on Value Creation

In addition to analyzing TSR rankings, Threading the Needle also explores the implications of below-average economic growth for value creation at companies that mainly do business in the developed world.

Capital gains will become a relatively less important source of TSR as lower GDP growth puts pressure on corporate revenues and profits, and average valuation multiples decline as investors reset their future growth expectations. Meanwhile, declining multiples means that the yield from payouts of free cash flow will increase, making direct payments to shareholders in the form of dividends or stock repurchases relatively more important.

“This shift in the composition of TSR means that there will be opportunities for some companies to achieve above-average shareholder returns by emphasizing cash payout,” said coauthor Eric Olsen, a senior partner in BCG’s Chicago office. “But the big winners will be those companies that manage to increase cash payouts even as they deliver above-average profitable growth in what is a much tougher and more competitive economic environment.”

The report identifies three priorities for value creation strategy in a low-growth environment.

• Target value-creating growth. Because achieving profitable growth is going to be more difficult, companies will need to take a tough look at existing business plans so as to weed out those growth investments that do not create value and focus only on those that do.
• Rethink capital deployment. As direct payments to shareholders become more important, companies may also have to question some legacy assumptions — for example, the preferability of share buybacks over dividend increases.
• Explore alternative scenarios for value creation. By creating alternative future scenarios that emphasize different uses of capital, a company can assess critical tradeoffs and define the most appropriate path for optimizing its value-creation strategy.

To receive a copy of the report or arrange an interview with one of the authors, please contact Eric Gregoire at +1 617 850 3783 or gregoire.eric@bcg.com.

About The Boston Consulting Group

The Boston Consulting Group (BCG) is a global management consulting firm and the world’s leading advisor on business strategy. We partner with clients in all sectors and regions to identify their highest-value opportunities, address their most critical challenges, and transform their businesses. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 69 offices in 40 countries. For more information, please visit www.bcg.com.

The antitrust inquiry disclosed by Google late Friday is just the latest sign of the intensifying scrutiny facing the company as it enters its adolescence. Since its inception in a Silicon Valley garage 12 years ago, Google has gone from a quirky startup to one of the world’s most influential businesses with annual revenue approaching $30 billion.

A spokesman for Texas Attorney General Greg Abbott confirmed the investigation, but declined further comment.

The review appears to be focused on whether Google is manipulating its search results to stifle competition.

The pecking order of those results can make or break websites because Google’s search engine processes about two-thirds of the search requests in the U.S. and handles even more volume in some parts of the world.

That dominance means a website ranking high on the first page of Google’s results will likely attract more traffic and generate more revenue, either from ads or merchandise sales.

On the flip side, being buried in the back pages of the results, or even at the bottom of the first page, can be financially devastating and, in extreme cases, has been blamed for ruining some Internet companies.

European regulators already have been investigating complaints alleging that Google has been favoring its own services in its results instead of rival websites.

Several lawsuits filed in the U.S. also have alleged Google’s search formula is biased. Google believes Abbott is the first state attorney general to open an antitrust review into the issue.

“We look forward to answering (Abbott’s) questions because we’re confident that Google operates in the best interests of our users,” Don Harrison, Google’s deputy general counsel, wrote in a Friday blog post.

Harrison said that Abbott has asked Google for information about several companies, including: Foundem, an online shopping comparison site in Britain; SourceTool, which runs an e-commerce site catering to businesses; and MyTriggers, another shopping comparison site.

All of those companies offer features that Google includes in its search engine or in other parts of its website. Foundem, SourceTool and MyTriggers have previously filed lawsuits or regulatory complaints against Google.

“Given that not every website can be at the top of the results, or even appear on the first page of our results, it’s unsurprising that some less relevant, lower quality websites will be unhappy with their ranking,” Harrison wrote.

Google says its closely guarded search formula strives to recommend websites that are most likely to satisfy the needs of each user’s request. If it didn’t keep its users happy, Google argues that people would become disgruntled and switch to other search engines offered by Yahoo Inc., Microsoft Corp. and IAC/InterActiveCorp’s Ask.com.

Regulators and lawmakers in the U.S. and Europe also have been looking into Google’s privacy practices and its acquisitions as the company tries to fortify its power.
From:Associated Press

The long-awaited recovery is now under way, but it’s a slow, painful slog that’s short on trust and confidence and long on a drumbeat of numbers that mostly shift from dreadful to less depressing. Twenty-seven months after the recession began, unemployment is stuck at 9.7%. Housing starts are dragging near half-century lows. Consumers are finally spending again, but they’re still too fearful about their jobs and homes to crowd malls and auto lots with the buoyant abandon that heralds a full-rigged revival, the kind Americans are used to.

Amazingly, as consumers struggle, U.S. corporations are staging a nearly unprecedented comeback that’s largely escaping notice. The gargantuan, dispiriting job cuts that seem to dominate the news have also been the spur for an epic resurgence in profits. For 2009, the Fortune 500 lifted earnings 335%, to $391 billion, a $301 billion jump that’s the second largest in the list’s 56-year history, approaching the increase in the robust recovery of 2003. For last year the 500 raised their return on sales from less than 1% to 4%. That’s close to the list’s 4.7% historical average.

Hence, the 500′s profits virtually returned to normal after years of extremes — bubbles in 2006 and 2007, collapse in 2008 — despite a feeble overall recovery that’s far from normal. This year’s list — reminder: the Fortune 500 ranks U.S. companies by revenue — is packed with changes that reflect and spotlight the trends reshaping corporate America. The homebuilders that occupied 14 places in 2007 and three last year, including Centex and Pulte, have all disappeared, casualties of shrinking sales. No fewer than nine newcomers from recession-resistant health care joined in 2009, among them drugmakers Genzyme (sales: $4.5 billion) and Allergan ($4.5 billion).

The fall in commodity prices removed half-a-dozen energy production, oil refining, and pipeline companies, and bumped last year’s No. 1, Exxon Mobil ($285 billion), into second place, far behind the new leader, Wal-Mart ($408 billion). The collapse in car sales pushed General Motors ($105 billion) from sixth to 15th place, the first time in the list’s history that GM didn’t make the top 10.

The rebound comes chiefly from three sectors: financial services, consumer cyclicals — items ranging from toys to furniture — and health care. In 2009 banks, securities firms, and insurance companies lowered their combined losses from a staggering $213 billion to just $20 billion. Buoyed by a government bailout, AIG swung from a loss of $99 billion in 2008 — a Fortune 500 record — to a deficit of $11 billion last year. The combined losses at Fannie Mae and Freddie Mac shrank by $15 billion to a still-huge $94 billion, as write-downs continued on subprime mortgages. By contrast, the banks and brokers, including J.P. Morgan, Wells Fargo, and Goldman Sachs, rebounded from losses of $8.7 billion to $38 billion in profits. Write-downs on toxic securities receded, and investment-banking profits jumped, helping offset losses on credit cards and mortgages. J.P. Morgan Chase doubled earnings to $12 billion, thanks chiefly to big gains in fixed-income trading.

In consumer cyclicals, a category that could be labeled “things you’d like to buy but can put off,” companies suffered losses of $42 billion in 2008. Casino operators, electronics retailers, and auto-parts suppliers saw revenues fall faster than they could slash costs. That trend reversed in 2009. Wal-Mart managed to lift revenues, on top of a big increase in 2008, by attracting bargain-hungry customers from competitors with remodeled stores and inexpensive private-label goods, offering everything from frozen pizza to patio furniture in one stop. A single trip also meant less spending on gas. Result: Earnings surged 7.0% to $14.3 billion.

The 500′s most exceptional study in ingenuity may be Mattel, the world’s largest toymaker. In late 2008, Mattel foresaw that sales would plunge in 2009 and introduced a clench-jawed cost-cutting campaign called Global Cost Leadership. Mattel pared its professional workforce by 10%, or 1,000 employees; paid down debt to lower interest costs by $10 million; and reduced overhead by $132 million. Its revenues did drop by $487 million, or 8%. But costs fell much more, by a remarkable $669 million before tax. Mattel booked a net income increase of $149 million, or 39%.

The star of 2009 is undoubtedly health care. The sector’s earnings jumped to an all-time high of $92 billion, placing it second behind tech at $94 billion. Health-care earnings rose by $23 billion, or 33%.

The Fortune 500′s remarkable response is yet another chapter in the saga of a list that’s gone from boom to bust to almost normal, all in the space of three short years. Never has getting to “almost normal” been a bigger achievement.
From:www.fortune.com

东京大学排名榜单第22位，在亚洲排名首位，香港大学排名第24位紧随其后，另外香港科技大学(35位)和香港中文大学(46位)也进入了前50名的榜单。

清华大学今年在此榜单中上升明显，排名第49位，跃升7位，去年排名为第56位。

附：世界大学前十名及部分大学排名

1、哈佛大学(美国)

2、剑桥大学(英国)

3、耶鲁大学(美国)

4、伦敦大学学院(英国)

5、伦敦帝国学院(英国)

6、牛津大学(英国)

7、芝加哥大学(美国)

8、普林斯顿大学(美国)

9、麻省理工学院(美国)

10、加州理工学院(美国)

22、东京大学(日本)

24、香港大学

35、香港科技大学

46、香港中文大学

49、清华大学

2 IBM 60,211 2% US

3 Microsoft 56,647 -4% US

4 GE 47,777 -10% US

5 Nokia 34,864 -3% Finland

6 McDonald’s 32,275 4% US

7 Google 31,980 25% US

8 Toyota 31,330 -8% Japan

9 Intel 30,636 -2% US

10 Disney 28,447 -3% US

11 Hewlett-Packard 24,096 2% US

12 Mercedes-Benz 23,867 -7% Germany

13 Gillette 22,841 4% US

14 Cisco 22,030 3% US

15 BMW 21,671 -7% Germany

16 Louis Vuitton 21,120 -2% France

17 Marlboro 19,010 -11% US

18 Honda 17,803 -7% Japan

19 Samsung 17,518 -1% S. Korea

20 Apple 15,443 12% US

21 H&M 15,375 11% Sweden

22 American Express 14,971 -32% US

23 Pepsi 13,706 3% US

24 Oracle 13,699 -1% US

25 Nescafe 13,317 2% Switzerland

26 Nike 13,179 4% US

27 SAP 12,106 -1% Germany

28 Ikea 12,004 10% Sweden

29 Sony 11,953 -12% Japan

30 Budweiser 11,833 3% US

31 UPS 11,594 -8% US

32 HSBC 10,510 -20% Britain

33 Canon 10,441 -4% Japan

34 Kellogg’s 10,428 7% US

35 Dell 10,291 -12% US

36 Citi 10,254 49% US

37 J.P. Morgan 9,550 -11% US

38 Goldman Sachs 9,248 -10% US

39 Nintendo 9,210 5% Japan

40 Thomson Reuters 8,434 1% Canada

41 Gucci 8,182 -1% Italy

42 Philips 8,121 -2% Netherlands

43 Amazon 7,858 22% US

44 L’Oreal 7,748 3% France

45 Accenture 7,710 -3% US

46 eBay 7,350 -8% US

47 Siemens 7,308 -8% Germany

48 Heinz 7,244 9% US

49 Ford 7,005 -11% US

50 Zara 6,789 14% Spain

51 Wrigley 6,731 10% US

52 Colgate 6,550 2% US

53 AXA 6,525 -7% France

54 MTV 6,523 -9% US

55 Volkswagen 6,484 -8% Germany

56 Xerox 6,431 1% US

57 Morgan Stanley 6,399 -26% US

58 Nestle 6,319 13% Switzerland

59 Chanel 6,040 -5% France

60 Danone 5,960 10% France

61 KFC 5,722 3% US

62 Adidas 5,397 6% Germany

63 Blackberry 5,138 7% Canada

64 Yahoo! 5,111 -7% US

65 Audi 5,010 -7% Germany

66 Caterpillar 5,004 -5% US

67 Avon 4,917 -7% US

68 Rolex 4,609 -7% Switzerland

69 Hyundai 4,604 -5% S. Korea

70 Hermes 4,598 1% France

71 Kleenex 4,404 -5% US

72 UBS 4,370 -50% Switzerland

73 Harley-Davidson 4,337 -43% US

74 Porsche 4,234 -8% Germany

75 Panasonic 4,225 -1% Japan

76 Tiffany & Co. 4,000 -5% US

77 Cartier 3,968 -6% France

78 Gap 3,922 -10% US

79 Pizza Hut 3,876 -5% US

80 Johnson&Johnson 3,847 7% US

81 Allianz 3,831 -5% Germany

82 Moet & Chandon 3,754 -5% France

83 BP 3,716 -5% Britain

84 Smirnoff 3,698 3% Britain

85 Duracell 3,563 -3% US

86 Nivea 3,557 5% Germany

87 Prada 3,530 -2% Italy

88 Ferrari 3,527 0% Italy

89 Armani 3,303 -6% Italy

90 Starbucks 3,263 -16% US

91 Lancome 3,235 N/A France

92 Shell 3,228 -7% Netherlands

93 Burger King 3,223 N/A US

94 Visa 3,170 -5% US

95 Adobe 3,161 N/A US

96 Lexus 3,158 -12% Japan

97 Puma 3,154 N/A Germany

98 Burberry 3,095 N/A Britain

99 PoloRalphLauren 3,094 N/A US

100 Campbell’s 3,081 N/A US

Rankings methodology:For the 2008 Vault consulting survey, we selected a list of top consulting firms to include. These consulting firms were chosen because of their prominence in the consulting industry and their interest to consulting job seekers. This year, over 4,000 consultants responded to our survey.
The Vault survey was distributed to the firms on Vault’s list in spring 2008. In some cases, Vault contacted practicing consultants directly. Survey respondents were asked to rate each consulting firm on the survey on a scale of 1 to 10 based on prestige, with 10 being the most prestigious. Consultants were unable to rate their own firm, and they were asked to rate only those firms with which they were familiar.

Vault collected the survey results and averaged the score for each firm. The firms were then ranked, with the highest score being No. 1, down to No. 50.

We also asked survey respondents to give their perceptions of other consulting firms besides their own. A selection of those comments is featured on each firm profile as The Buzz.

Remember that Vault’s top-50 strategy consulting firms are chosen by practicing consultants at top consulting firms. Vault does not choose or influence the rankings. The rankings measure perceived prestige (as determined by consulting professionals) and not revenue, size or lifestyle.