What do these companies have in common? According to CRO magazine (formerly Business Ethics), they are among the world’s Best Corporate Citizens, setting the gold standard in governance, ethics and corporate social responsibility (CSR).

“When someone next asks you to define corporate transparency, show them this list,” touts the magazine. “[Our] 2009 CRO 100 Best Corporate Citizens List is the world’s best-known apples-to-apples comparison of Russell 1000 companies’ performance in environment, climate change, human rights, employee relations, philanthropy, financial and governance.”

While the CRO’s leading “apples” might have done laudable things, several are also involved in ongoing legal and public relations scuffles stemming from alleged ethical breaches and poor business judgement. For these “top 100” firms, that’s nothing new:

• Merck, whose Vioxx product gave rise to class action lawsuits over allegedly deceptive marketing practices in 2006, is once again accused of engaging in similar deceptive practices

• Monsanto, which Amnesty International calls a “global corporate terrorist,” is using litigation as a tool to protect its market share and has filed dozens of lawsuits against family farmers across North America, alleging they “stole” airborne seeds

• ExxonMobil, which has a history of environmental and human rights lawsuits, has yet to pay $92 million worth of Valdez spill-related damages to plaintiffs in Alaska

• Chevron, which also has a history of environmental and human rights lawsuits, now argues that renewables “are not a mainstream business”

• Citigroup, which in 2002 faced FTC charges for abusive lending practices,  was recently accused of lying to investors and its own employees about the risks inherent in several speculative, mortgage-backed securities funds. It also froze customer lines of credit after receiving $20 billion in government bailout money

• Goldman Sachs, which in 2002 faced SEC lawsuits for securities fraud and conflicts of interest, recently changed accounting rules in order to hide December losses. It is also accused of being a serial violator of SEC regulations prohibiting long-outlawed “naked” short sales of stock

• Smithfield Foods, which recently faced multiple environmental lawsuits, runs slaughterhouses in Mexico that some experts have linked to diseases like swine flu

CRO’s Best Citizens list sheds light on a critical problem that keeps CSR on the sidelines of many corporate agendas: the industry is too ambiguous for its own good. As Paul Hawken argued several years ago in his critique of the $2.7 trillion socially responsible investment (SRI) industry: “The term ‘socially responsible’ is so broad it is meaningless…There are no standards, no definitions, and no regulations. Anyone can join; anyone can call his or her fund an SRI fund.”

To be sure, the CSR industry’s lack of universal standards and criteria leave many questions unanswered. But research indicates that it doesn’t need to be this way.

Companies that dabble in every conceivable CSR facet (community, diversity, environment, human rights, etc.) tend to be less effective than companies that pursue deliberate strategies in a focused area – both in terms of making a substantive social and environmental impact, and in terms of generating a financial return on their corporate responsibility investment. That was a key finding of my 2007 CSR effectiveness study, and it runs contrary to the way that companies are rated on “Best Citizens” lists.

According to the CRO’s methodology, Best Citizens lists are compiled by quantitatively rating companies across a breadth of performance dimensions:  environment, climate change, human rights, employee relations, philanthropy, financial performance, governance andlobbying activities. Scores are assigned to each category (some categories count more than others) and those companies with the highest cumulative scores win. Though the CRO suggests that this breadth approach to CSR performance evaluation yields a more holistic view, the result is that any company, regardless of history or industry, can be included for consideration. Halliburton and Blackwater (Xe) have yet to make the cut, but that may only be a matter of time.

On the other hand, as mentioned above, my research clearly demonstrates that depth works better than breadth. Rather than taking on every CSR issue at once, the companies producing the best triple bottom-line results (High-Purpose Companies) go deep in one or two particular areas where they know they can make the biggest difference. They find common ground between their core strengths and a critical problem that needs solving – and thus develop profitable solutions to that end. High-Purpose Companies have the financial incentive to create social and environmental value. That’s not always the case at the firms making CRO’s cut, which is why the magazine risks missing the point.

If the CSR industry is to be taken seriously in the future, then it needs to reward companies for producing value, not just preaching values.  Now is the time for an industry makeover. Let’s start with objective standards, critical thinking and a much stronger voice.

While brands are important corporate assets, the value they create for stakeholders tends to be largely intangible in nature. Brands themselves do not physically pollute, clean-up, employ, invent, invest, engineer, design, reach out, assist, collaborate and singlehandedly, they cannot save the world. Corporations and the networks, innovations and people inside them, on the other hand, can – and often do.Irrespective of how catchy the phrase ‘sustainable brand’ is, the fundamental issue remains: either a company is sustainable, or it’s not.

Some companies approach sustainability with an unparalleled level of innovation and fearlessness. I have written about such companies numerous times in books, essays and articles, which is why I am so disappointed to see many of them continuously omitted from the surveys, articles, and highly-touted lists pulled together and promoted by the corporate social responsibility (CSR) industry – particularly those citing the “greenest,” “most ethical” or “most sustainable” citizens or brands.

In March, CRO Magazine chose Merck, Monsanto, Chevron, Citigroup, Goldman Sachs, Smithfield Foods and other questionable choices as “Best Corporate Citizens of 2009” (read my response here).

Last week, a survey released by Cohn & Wolfe, Landor Associates,  Penn, Schoen & Berland Associates; and, Esty Environmental Partners indicated that Clorox Green Works, not Seventh Generation, was the “Top Green Brand.”

Perhaps this result was to be expected given that Clorox Green Works now owns over 40 percent of the green cleaning category. But I found the result disappointing, since Seventh Generation is a 20-year old pioneer in the green cleaning market, a leader in green business practices, and is well on its way to becoming a truly sustainable company. Clorox Green Works was recently introduced and has basically relied on its marketing muscle and existing distribution infrastructure to achieve success with Green Works. Although the Green Works product line is a step in the right direction for Clorox, the company also markets highly profitable toxic products like Formula 409, Tilex, and Armor All.

As frustrating as Seventh Generation’s pass over was, the icing on last week’s faux ‘sustainable brand’ cake had to be Forbes’ lead story: “ExxonMobil: Green Company of the Year.”

Exxon’s latest marketing campaign sends a message to stakeholders: “Taking on the world’s toughest energy challenges” while “preserving and protecting the environment.” Some people might buy that message, along with the company’s pitch that, despite its past and allegedly present efforts to fund global warming skeptics, a sizable investment in natural gas equals a genuine commitment to “going green.” But judging from the reader commentary posted on the Forbes website, not everyone is easily persuaded:

What are you smoking Forbes?? Besides Natural Gas?? Or did Exxon just buy a lot of advertising from you? Calling the company that denies global warming is real “green” is akin to calling the Mob a bunch of nice guys. Burning natural gas is not green, period. Cleaner, yes. But not green. Do some real investigative journalism and not just regurgitate some PR hack’s false truths!

As this reader commentary correctly points out, by calling an unsustainable company like ExxonMobil “green,” Forbes crosses the line between journalism and public relations. In the same way, by labeling other unsustainable and ethically dubious companies “Best Citizens,” “Greenest Brands,” “Sustainable Brands,” or what have you, the CSR industry is effectively perpetuating a standard of greenwash.

Greenwash is dangerous to our economy because it runs the risk of breeding consumer and investor cynicism toward genuinely sustainable companies that create environmental, social and financial value through the products they sell, the investments they make and the issues they relentlessly fight for. All of this ‘information greenwash’ being spun out of research groups, media companies and the CSR industry accumulates on the web over a period of months and years. In time, consumers and investors will be left with a data trove of incomplete and arguably inaccurate information with which to make investment and purchasing decisions. That means their money could end up in the wrong places – in companies and investment funds that, if they knew better, they would not support.

That problem is as serious as it is unjust.

Bottled water activists point to plastic waste, energy consumption, greenhouse gas emissions, the environmental effects of water extraction, water privatization issues and a range of social problemsgenerated by the industry. Could such “road blocks” deter long-term growth for corporate bottled water empires? Nestlé thinks not.

According to a 2009 document entitled “The Future of Bottled Water” authored by Nestlé CEO Kim Jeffery, the company’s broad portfolio of bottled water products, including Poland Spring, Perrier, Arrowhead, Deer Park and Zephyrhills, are well-positioned to recover from the present economic slump. “Bottled water is perfect as it is,” the company says. “[There are] limited opportunities to innovate.”

This company is clearly not of a world-changing mindset. Nestlé takes the position that the bottled water industry is unfairly portrayed as a “villain” by environmental activists and an angry public, and that “environmental facts do not support this.” Really, Nestlé?

In a press release and video web site launched last week, Nestlé attempted to express to the public the environmental virtues of bottled water. “Bottled water is actually the most efficient choice of any packaged beverage available to consumers,” the company insists. “Bottled water is a very small user of our water resources…Plastic represents less than one percent of solid waste. While water bottles can be recycled, not all Americans have access to curbside recycling…To sum it all up, bottled water is a healthful choice, can cost less than 20 cents per bottle, and has a lighter environmental impact.”

Of course, not everyone sees things through the corporation’s rose colored lens. Take the 5,400 local citizens of Salida, Colorado who recently banded together in order to fight Nestlé off and protect its local water resources and land. Or what about the residents of McCould, California, who claim their town was torn apart by Nestlé’s operations in the area? Nestlé makes no mention of such stakeholder concerns in its press release or video web site, both which set forth to “set the record straight.”

Nestlé has a public relations problem. The problem isn’t just that Americans around the country are hanging signs in their windows and entryways reading: “Stop Nestlé” or “Nest-Leave.” Nestle’s public relations problem is its sterile, detached response. The company seems to be under the impression that people will read its communications in an isolation chamber, devoid of context, clue, cultural condition, and (yes, Nestlé) fact.

Let’s start with the hard data. According to Food and Water Watch, bottled water produces up to 1.5 million tons of plastic waste per year. That plastic requires up to 47 million gallons of oil annually to produce. And while the plastic used to bottle beverages is of high quality and is demand by recyclers, over 80 percent of plastic bottles end up in land fills. That’s why the Pacific Rim Garbage Patch, the floating vortex of waste that’s twice the size of Texas, is comprised mainly of plastic. It’s also why so many sea creatures die every day from ingesting plastic, and why plastic waste has become one of the chief concerns of our Nation’s top environmental groups.

On the cost side of things, consumers pay a huge markup on a product even though as much as 40 percent of it comes from a tap in the first place. Stakeholder communities also pay. Food and Water Watch says Nestléhas an unfortunate reputation for moving into communities, taking water for next to nothing, selling it for a hefty profit, then leaving the locals to deal with the residual environmental and social externalities, and moving on. “Next!”

None of these issues are substantively addressed in Nestlé’s press release or on its video website. Through bullet points, select interviews and clip art snippets, the company only superficially confronts the environmental impacts of bottled water. Nestlé avoids all controversial content, including details related to ongoing rifts with local communities around the country. The company’s corporate tone of voice, detached message and superficial approach to “issues outreach” demonstrates an indifference to the wider public’s ardent support for environmental reform and social justice. The pitch is all wrong.

Nestlé broke every cardinal rule in social media, stakeholder engagement and transparency with it’s one-sided, “set the record straight” public relations effort. There is no meaningful opportunity to interact with the company, no way to leave a comment. My bet is, the only folks convinced by Nestle’s “bottled water is good” message will be those who manufactured it.