Apple (AAPL), Microsoft (MSFT), Disney (DIS) Are Top Admired Companies

Apple Inc. (AAPL), Microsoft Corporation (MSFT), and The Walt Disney Company (DIS) are all at the head of the class in the 2021 release of the World's Most Admired Companies list, a long-running feature in Fortune Magazine. These companies rank first, third, and fourth, respectively, on the 2021 list. The second-place finisher was Amazon.com, Inc. (AMZN).

The Methodology

Fortune partners with organizational consulting firm Korn Ferry in creating the World's Most Admired Companies list. They start with a universe of 1,500 companies, consisting of the 1,000 largest in the United States by revenues, plus 500 non-U.S. companies with revenues of at least $10 billion. They then select the highest-revenue companies in each industry, eventually reducing the field to 670 companies representing 52 industries and 30 countries.

Executives, directors, and securities analysts responded to surveys sent by Korn Ferry. They were asked to rate companies within their own industries based on nine criteria, from investment value and quality of management and products to social responsibility and ability to attract talent. This stage produced lists of the best-regarded companies in each of those 52 industries.

Next, the 3,820 executives, directors, and securities analysts who had responded to the industry surveys were asked to select the 10 companies that they admired most, regardless of industry. The field from which they made their selection included both the top 25% in the 2020 surveys and the top 20% within each industry in the 2021 process. The final result was a list of 50 all-stars, comprising the 2021 World's Most Admired Companies.

Significance for Investors

Ranking high on a list of this sort certainly offers some bragging rights to the companies so honored, but direct impacts on company results and investor returns are likely to be marginal, at best. However, companies do use such honors as a recruiting tool, and some potential job candidates indeed are swayed by them when making decisions about where to work.

As a result, companies such as Apple, Microsoft, and Disney may be getting a bit of an advantage over their competitors in the war for top talent. Meanwhile, second-place finisher Amazon.com, Inc. has become noteworthy for a high-pressure corporate culture, which may be an attraction for some job seekers, but a negative for many more. Whether this survey helps to soften negative impressions about Amazon as an employer is anyone's guess.