If there is one thing that business leaders respect above all in a company, it is consistent domination of an industry over many years.

This is the seventh year that the Financial Times and PwC have asked chief executives which companies in the world they respect most and, each time, they have given the same answer: The company we respect most is General Electric, followed by Microsoft.

It was the longevity of the two companies’ achievement that so impressed the chief executives interviewed, 915 of them across 25 countries. One respondent said of GE: “I respect their durability, stability and continuous growth over decades.” Another paid tribute to GE’s “sheer scale”.

Microsoft is a far younger company than GE, but many chief executives marvelled at how powerful it was. “They are so dominant and successful,” one respondent said.

Others may carp at Microsoft’s hold on its industry, but not the chief executives interviewed here. They would no doubt love to occupy a similar position with their own businesses. “They have a monopoly,” said one admirer. Another chief executive said the reason he respected Microsoft was simple: “They rule the world.”

GE and Microsoft are not the only companies that have retained respondents’ respect throughout the time we have been running these rankings.

The top five companies this year have been in the top 10 in each of the past seven years: Toyota and IBM, in third and fourth places respectively in 2004, have always been near the top of our list.

Coca-Cola is also a perennial presence in the top 10. It is fifth this time, up a place, in spite of its recent leadership troubles, which saw Douglas Daft replaced as chief executive by Neville Isdell. The comments of the chief executives we interviewed show that they regarded Coca-Cola’s reshuffle as a temporary difficulty; most of them focused instead on what the company had achieved over the decades.

“There’s hardly any village in the world where Coca-Cola isn’t known,” one chief executive said. “For 100 years, they have maintained dominance,” said another. “A fabulous brand story,” commented a third.

Places eight to 10 on our most respected list are occupied by new faces: all three companies have risen sharply this year.

Eighth place is held by Citigroup. Some may be surprised to see the financial services giant rising from 31st last year, given its regulatory problems on three continents.

Citigroup’s performance is analysed elsewhere in this report, but chief executives made it clear that they still admired the group, in spite of its ethical problems, because of its size, the worldwide nature of its operations, and how long it had been around.

Many of the respondents have clearly seen Citigroup at work in their own countries. “I like their global presence, the way they look and their approach to customers,” one chief executive said. “They are a big company, but they stay in touch with local customers.”

Procter & Gamble has gone from 18th place last year to ninth in 2004, with respondents commenting favourably on the company’s brands, marketing and ability to regenerate itself. The other rising company in the top 10 is Hewlett-Packard, up from 29th to 10th. Carly Fiorina, its chief executive, is given great credit from respondents for successfully integrating Compaq.

While the consequences of the corporate scandals of the past few years continue to reverberate, most chief executives have turned their attention to how to win back investor and public confidence. It is noticeable that most of the companies that won overall respect also won high marks for the quality of their corporate governance.

GE received the highest rating for its corporate governance from business leaders. Several chief executives commented on the quality of the information published by GE. Its corporate governance structure was transparent and easy to understand. Chief executives thought it was no accident that GE had managed to maintain its reputation for ethical behaviour.

“After all these years, they have never been brought into disrepute,” one chief executive said. Another commented: “The complexity of their business makes their ability to stay out of trouble more impressive.”

Respondents also commended GE for the way it handled the transition from Jack Welch, its long-serving boss, to Jeff Immelt, its current chief executive. “The structure of top management has survived Jack Welch. It has held up. They do not cut corners,” one chief executive said.

The same was said about the company chief executives rated second for the quality of its corporate governance: IBM. “Good and very transparent policies, a high standard of corporate governance - and no scandals,” said one chief executive.

Several respondents mentioned different companies’ approach to top executive remuneration. One chief executive said of IBM: “It recognises its responsibility to shareholders. It won’t give extravagant pay packets for mediocre work.”

A striking feature of the top four companies, GE, Microsoft, Toyota and IBM, is that they were in the top 10 on every criterion we asked chief executives about: in addition to overall respect and corporate governance, chief executives also put them in the top 10 for corporate social responsibility and innovation.

Fund managers named Microsoft and GE respectively first and second for generating shareholder value.

What about wider constituencies? Campaigning organisations put Microsoft first and IBM second for corporate social responsibility, although they did not rate GE or Toyota highly.

The campaigners did, however, award Microsoft, GE and Toyota the first three places for their corporate governance.

Another notable feature of our survey of international business opinion, is how dominant US companies remain.

Whatever reservations people around the world may have about recent US foreign policy, they still look to US companies for lessons in how to run a business.

Toyota, the Japanese carmaker, is the only non-US company in the top 10. Of the top 50 companies, 26 are American.

The only other countries with any substantial representation are Germany, with six companies in the top 50, Japan with five and the UK with three, or five if you include Anglo-Dutch groups Unilever and Royal Dutch/Shell.

It is not only the most respected companies that have been remarkably consistent over the years; so have the industrial sectors they represent.

You might expect that the move away from heavy manufacturing to services in most developed countries would be reflected in our rankings.

You would imagine, too, that the bursting of the dotcom bubble would be seen in the decline of information technology, telecommunications and electronics companies at the top of the table.

Neither of these assumption turns out to be true.

The number of engineering companies in the list of the 50 most respected companies has declined from 14 to 10 since 2002, but it is higher than the eight engineering companies that appeared in the top 20 in 2000.

There are more companies in the top 50 from the engineering sector than there are from any other industry.

There are eight IT companies in the top 50 this year.

That is two fewer than there were in 2000, but two more than there were in 2003.

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