International Company Rankings Key Terms

Understand the key terms used in international company rankings

By B. Lumadue

A number of research organizations, magazines and journals, and private institutions rank international companies. Variables used in rankings vary. Most use financial and sales figures, including revenue, market value, assets and growth. There are other more narrow rankings, such as green initiatives, best places to work and most admired companies. Many research sources rank companies within an industry, which can give a better picture of a company's standing as it relates to current industry trends. When looking at international company rankings, get to know some of the key terminology used by ranking systems to make sure you are comparing the data that is most relevant to your business.

Market capitalization

A popular ranking tool is market capitalization, which is the value of the company's outstanding shares. The monetary values are converted into a common currency when ranking international companies.
Try: See The Financial Times for a description of its ranking system and a few of the top ranking companies. Check out Investopedia for a definition of market capitalization.

Revenue

Another ranking tool, used by Fortune magazine and other industry analysts, is revenue. Revenue is the amount of money a company receives in a year for products or services sold, before deducting expenses.
Try: Check out ADVFN for a definition of revenue.

Foreign assets

The United Nations Conference on Trade and Development ranks international companies based on the amount of foreign assets held as well as additional financial data including sales and employment.
Try: See the United Nations Conference on Trade and Development for information about its company ranking systems.

Growth

Forbes uses annual average growth in revenue and net income to rank international companies. The top ranked companies in their survey have expanded earnings at 25% annually.
Try: View the Forbes international company rankings for more information about their ranking system and examples of high performance.

Green

A modern trend in ranking companies surveys "green" initiatives like emissions, water use, energy consumption, recycling, alternative energy sources and employee training.
Try: Reuters has posted an article about Natural Health Magazine's survey and ranking of the top multinational green companies. Greenpeace ranks electronics companies based on their green initiatives.

Industry specific

Industry specific rankings are used to evaluate and compare companies in a specific industry. Rankings may be done using financial data or variables.
Try: See GlobalEDGE from Michigan State University for examples of industry specific company rankings.