Explained: The history of the Fortune Global 500 list and the significance of LIC making the ranks

The Fortune Global 500 is an annual ranking of the 500 largest corporations across the world as measured by total revenue. This year, Life Insurance Corporation (LIC) broke into the list at the 98th position, making it the highest-ranked Indian company

India’s largest insurer, Life Insurance Corporation of India (LIC), has 98 reasons to smile.

The government-owned firm, recently listed, broke into the latest Fortune Global 500 list at rank 98 — the highest spot for an Indian firm on the global index.

LIC, with a revenue of $97.26 billion and a profit of $553.8 million, was joined by eight other Indian companies on the Fortune Global 500 list, including Reliance Industries, Indian Oil Corporation (IOC), Oil and Natural Gas Corporation (ONGC) and others.

But, what is a Fortune 500 company? What’s the history behind the ranking? Why is it considered to prestigious for a firm to be on the list? We examine this and more.

What is the Fortune 500?

The term Fortune 500 refers to a list of 500 of the largest companies in the United States compiled by Fortune magazine every year. Companies are ranked by their annual revenues for their respective fiscal years. This list includes both public and private companies using publicly available revenue data.

In 1955, the editor of Fortune, Edgar P Smith, thought of publishing a list of the most successful American companies in an effort to measure the size and power of American businesses during a time when the country’s economic power was “the envy of the world”.

Originally called the Fortune Industrial 500, the name of the list was shortened to Fortune 500.

Initially, the list contained only companies that were in the manufacturing, mining, and energy sectors. Incidentally, in the original 1955 Fortune 500 list, General Motors (GM) was the top company with annual revenues of $9.8 billion.

In 1995, the ranking underwent its biggest change when it also included service companies for the first time.

In 1989, the magazine decided to come out with a Fortune Global 500 list, which would be an annual ranking of the largest 500 corporations worldwide as measured by total revenue.

Is it a big deal?

The answer is a big, resounding yes.

For a firm to be included in the Fortune Global 500 list is prestigious. As Alan Murray, the president and CEO of Fortune writes, “The Fortune 500 is THE iconic list of large companies. If you made the Fortune 500, you know you have made the big time.”

The list today has become an institution and companies love to be a part of it. Murray adds, “It’s a measure of prestige. It means that they are big enough to play with the big boys.”

As another editor of the magazine had once said, “Being on the list means you are the biggest.”

What did the 2022 Global list reveal?

Walmart landed at number one for the ninth straight year, trailed by Amazon, which reached its highest ranking ever.

Chinese energy giants State Grid, China National Petroleum, and Sinopec rounded out the top five.

China, including Hong Kong, had 136 companies on Fortune's largest companies list — the most of any nation. The US ranked second, with 124, while Japan was third with 47. And for the first time in the history of the rankings, the aggregate revenue of listed companies based in Chinese-speaking countries surpassed that of US companies on the list.

Here are the top 10 on the Global 500 list:

  1. Walmart (US)
  2. Amazon (US)
  3. State Grid (China)
  4. China National Petroleum (China)
  5. Sinopec Group (China)
  6. Saudi Aramco (Saudi Arabia)
  7. Apple (US)
  8. Volkswagen (Germany)
  9. China State Construction Engineering (China)
  10. CVS Health (US)

What about Indian companies?

The Fortune 500 Global list also saw the inclusion of nine Indian companies. LIC was the highest-ranked Indian company, at the 98th position.

Reliance Industries — which has been on the list for 19 years — also saw a jump of 51 spots to 104 in the 2022 rankings.

Indian Oil Corporation (IOC) rose 28 places to the 142nd rank while Oil and Natural Gas Corporation (ONGC) climbed 16 places to 190.

The list also has two Tata group firms — Tata Motors at 370 and Tata Steel at 435th spot. Rajesh Exports at 437th rank was the other private Indian company on the list.

State Bank of India (SBI) climbed 17 places to rank 236th and Bharat Petroleum Corporation Ltd 19 places to 295.

Disclaimer: Firstpost is part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

With inputs from agencies

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