Financial 411: China Dominates Fortune 500 Rankings
Thursday, July 07, 2011
According to Fortune magazine's annual ranking of the world's 500 largest companies, Walmart is still the world's largest company by revenue, but now it's joined by three Chinese companies in the top 10.
The domination of American companies on the Global rankings has shrunk. Only 133 made the list compared to 185 a decade ago. But everyone is making more money — profits of the 500 companies rose nearly 60 percent from last year.
Executive editor of Fortune, Stephanie Mehta, said the large jump in profits this year is due in part to some world economies — namely China and India — coming out of the global recession in 2010, as well as the rise in oil prices.
Sixty-one Chinese companies made the Fortune's Global 500 list compared to just a dozen a decade ago. Mehta said most of them are not household names, like State Grid, Sinopec and China National Petroleum.
"I'd expect the trend is going to change there. Just as it took a while for Japanese and Korean companies to become household names," Mehta said.
While some obvious American companies made the list, like Walmart, others such as Proctor and Gamble and AIG, which received $182 billion in bailout money, came as a surprise.
"We simply record what the companies revenues are," said Mehta who noted the rankings do not take companies' histories into account. "Companies let us know what their revenues are. How they got the revenue, how they achieve a particular revenue isn't a factor. It is an objective ranking... We're not making a judgment call about whether they're good or bad companies."
Mehta said her favorite story from all the rankings is Apple: they shot up to No. 111 from No. 197, as their revenue climbed 78 percent: "Most companies grow because they get a big acquisition or merge. Apple's growth is organic," she said.