Forbes is known for its lists. The most famous are those of theworld’s wealthiest people, yet Forbes Asia also features othernotable lists, such as this issue’s Global 2000 ranking of theworld’s 2,000 best big companies. Later on in the year we’llalso have the Best Under a Billion list, of the 200 best performingcompanies with sales under $1 billion, and the Fab 50 list of the 50best large companies, both for the Asia-Pacific region. It’s worthdelving into our screening process for these company lists, since ourmethodology is what sets our lists apart from those found elsewhere.For others, a ranking based on a single metric is enough, for example,companies ranked by sales or profits. The issue with a single metricis that it can be one-dimensional. Any company can goose its sales,for example, by lowering prices, and thus get a higher score on a listlooking only at sales.

      By contrast, Forbes takes an approach that is harder to explain andimplement, but produces a better quality of rankings. The companylists in Forbes and Forbes Asia are typically based on compositescores using multiple metrics. For example, the Global 2000 list’smethodology looks at a company’s revenues, profits, assets and marketvalue. These four metrics are all taken into account to derive the finalscoring of the 2,000 companies. It is much harder for companies togame this approach, as artificially increasing sales by lowering priceswould normally result in reduced profits. When added together, thehigher score in one area will be offset by a poorer score in another.

      Taking these four metrics together leads to a powerful filtering ofcompanies, with only the highest quality ones making the final cut.Only those managing well across all the metrics—sales, margins,assets and market value—will rise to the top of our Global 2000 list.These companies are doing well across a range of metrics, implyingthey have a more robust and sustainable business model than thoseexcelling in only one metric.
      To top it off, these lists get both digital and human screenings.Once the computer has sorted the results by raw numbers on aquantitative basis, human editors provide the final quality controlon a qualitative basis. They check for issues such as firms with goodresults but lackluster reputations, and other issues that don’t show upin figures on a spreadsheet. When the final tally is made, the distilledproduct is not just a tally of one-dimensional wonders, but also amore accurate representation of real-world champions.