The Industrial Management Institute has prepared a ranking of Iran's top companies for many consecutive years now. Inspired by the institute’s mission, this list creates a clearer atmosphere of the country's economics and businesses through providing transparent, meaningful stats and info about the Iranian economic enterprises. This helps managers, policymakers and researchers in reaching a more accurate understanding of the scale and the financial/economic structure of the country's major industries and enterprises.
The Top 100 Companies List belongs to major Iranian companies in a way. Due to IMI’s national macro view in creating this list, the main focus is on identifying the interrelated status of the country's major enterprises. In other words, due to the extensive back-and-forth communications between Iran's largest companies, their boom and bust will quickly manifest in all levels of the country's economy; therefore, by preparing these rankings, IMI endeavors to annually paint a reliable quantitative statistics-backed picture on how the changes in the arrangement of large Iranian enterprises and various industries and economic activities work alongside each other. The dynamism, consistency, and acceleration of the development process in enterprises, and consequently the national economy, relies on a comprehensive, correct cognition of the strengths and weaknesses of their economic activities; the strength or weakness are conceptually relative and dependent on comparison, hence the comparison of the Iranian industries and enterprises against each other provides a context that can be a beneficial guide for managers, policymakers, and investors, and also help researchers view the business environment from new perspectives.
In recent years, the changes in this picture that have occurred or are just shaping up constantly, can have different implications or inferences from different perspectives for the viewer. Meanwhile, the gradual fall in the rankings of companies operating in a certain industry within a multi-year trend, would signify an unjustified investment, or an increase in opportunity costs, for domestic or foreign investors. To economic policymakers, this may be a sign to increase their efforts in finding solutions or identifying problems; for the researchers however, the shifts in the rankings of the Top 100 Companies List are opportunities for scientific research. For the CEO of an enterprise that is ranked among the top 100, a shift in their ranking could be a good time to review the performance and identify the new strengths and weaknesses. There are other examples, but let’s suffice to the above.
This macro/national-level standpoint, along with the attention to the demands of the project beneficiaries on one hand, and the consideration for the availability of quantitatively reliable statistics and the relative nature of the rankings on the other hand, are the reason that the indicators’ type implemented in these rankings are selected and refined in line with the purpose of the plan.
As a first step in doing so, the list that compares companies and enterprises from a macro and national perspective in order to paint a picture of the arrangement of the enterprises within the Iranian business environment, is a general list. In fact, all the economic activities (services, industrial, etc.) can essentially compete with each other in the allocation of society's resources, will be put together in the same list. The second step is to set the sales criterion as the basis for the selection of the top 100 companies. As the final step, these selected companies are compared from different perspectives, with several indicators that are mentioned later.
The economic effectiveness of an enterprise’s activity at national level is directly correlated to the company's sales volume. The sales volume of a company shows the degree of interaction between a firm and the economic structure of the country, and the more the firm interacts with other economic components, the more its prosperity and recession gains important. Therefore, the selection and ranking of companies based on the ‘sales volume’ index follows an economic and managerial logic. Basically, the issue of ‘corporate growth’ is of special importance and status in economics and management. ‘Sales’ is the most important final output in any commercial company, and the ‘sales process’ in particular, shows the outcome of the interaction of many quantitative and qualitative, internal and external, factors of the company. Also, entering the global competition arena is only possible for large companies (with high sales).
This comparison and ranking is based on the financial info disclosed in the financial statements of the companies, which has been obtained through the public call, direct correspondences, and numerous subsequent follow-ups. We hereby thank all those companies for their cooperation.

Ranking Methodology

Ranking the companies in the business environment is a scientific attempt to summarize a large amount of the business environment information in the form of a simple, comprehensible benchmark. Rankings can provide the beneficiaries (e.g., managers, shareholders, investors, creditors, banks, customers/clients, government, state organizations, etc.) with valuable information about the status of the companies in comparison to their competitors. With the help of the continuous reviewing of the changes in the rankings of companies, it is now possible to identify and follow-up on the direction of the movement of businesses, determine the prospects of future boom or bust in various industries, and even evaluate the effectiveness of the applied reform policies.
Bear in mind that there are two main methods for evaluating enterprises:
First method evaluates the status and performance of companies. Many of the world's most conventional ranking lists, (e.g., Fortune 500, Fortune 1,000 US, FTSE, S&P 500, etc.) rank companies based on one, or a set of output-oriented benchmarks. In fact, the evaluation of the status and performance of companies for the list is based on one, or a set of indicators which, by nature, determines the output of the company's performance.
The second method includes the process evaluation of the company's performance, aka the process-oriented method. In such ranking models, the evaluation criteria of companies are mainly focused on the work process. These models rely on a wider array of indicators, both qualitative and quantitative, as well as on a wider range of variables, including inputs, processes, and outputs. Conventional types of quality assessment models, such as Deming, Baldrige, EFQM, etc., are in this group. These models are undoubtedly more appropriate for evaluating any particular company, therefore in order to report to the managers and direct stakeholders of the company, because they get extensively involved in the performance of the company, but for the same reason, they have less influence. In fact, the audience for this type of ratings are limited to the direct beneficiaries of the company; also the companies participating in this type of ratings are limited.
In many cases, some parts of the process for these rankings are conducted in a ‘self-evaluation’ manner, since process-oriented methods need a wide range of information in order to calculate the evaluation criteria.
This issue will make the outcome unreliable when it comes to ranking a large number of companies. Therefore, the process-oriented methods have less capacities in compiling public catalogs. Here’s an example of the difference in influence levels between the two rating methods: many are familiar with the Fortune 500 list and know which company is on top of the list, but there’s not enough information about the EFQM rankings of the US or other countries available.

Ranking Objective

The main objective for compiling the IMI-100 rankings is to “determine and rank the companies’ level of contribution to the national economy, in order to promote transparency and competitiveness within the business environment, and to generally raise the status of Iranian enterprises.”
Taking this objective into account, output-oriented (result-oriented) ranking methods are more suitable for the IMI-100, since bringing transparency to the economic status of companies is a goal that process-oriented models cannot meet; especially when it comes to determining the companies’ economic status comparatively, we cannot limit our assessment to a few specific companies. Also, increasing the number of companies will make it impossible to use process-oriented methods as a consistent, annual work.
In short, the IMI-100 is a list that intends to identify the economic status of enterprises based on output-oriented ranking methods.
IMI-100 is a general list that consists of various different enterprises – i.e., manufacturers, services, insurances, investment companies, and banks – participating in this, so in order to homogenize their sales figures, the total operating income of the company is taken into account.

Ranking Indicators

After selecting and ranking them based on the ‘sales volume’ index, these companies are compared and ranked based on other indicators as well. Here are these indicators:

Category Indicators
Company size and growth indicators Sales, sales growth, per capita sales, value added, assets, asset growth, number of employees, employment growth
Profitability and performance indicators Profitability, profit growth, sales returns, return on assets, return on equity, turnover, ownership ratio, share of non-current assets in total assets
Productivity indicators Total productivity, total factor productivity, manpower productivity, capital productivity
Export indicators Exports, per capita exports, export growth, export-to-sales ratio
Liquidity indicators Current ratio, net ratio of operating funds to sales, net ratio of operating funds to operating profit
Debt indicator Debt ratio, interest expense coverage ratio
Market Indicators Market value, equity market returns, P/E ratio, P/B ratio

In analyzing the statistics and ranking results provided by companies, it is necessary to pay proper attention to the issues that may arise due to the specific conditions of Iran – as a developing economy:

  • • In the Iranian economy, as in many developing economies, prices do not reflect all economic realities. The existence of various subsidies, government interventions in controlling prices, and such issues cause prices to deviate, and therefore the prices won’t reflect the true state of the companies’ growth. In a healthy economy, for example, an increase in a company's gross profit indicates an increase in the price, or the number/amount of products sold. Since the increase in prices is basically due to the increase in the quality of the manufactured products, thus, the increase in sales indicates a real, healthy growth of a company. Within the Iranian economy, part of the changes in prices is either due to the existence of monopolistic markets, or due to government intervention in determining the prices of products of manufacturers. Therefore, this issue must be considered when ranking companies in terms of their sales. The price deviation problem is not only a problem of the IMI-100 rankings, but also a problem that manifests itself in all kinds of economic statistics. National accounts, household consumption baskets, government budget, and similar statistics all contain price deviations and, therefore, do not reflect all economic realities. It is only natural that pricing will move towards greater transparency and health, as government intervention is reduced and trade is liberalized.
  • • Due to the country's inflation history in recent years, the comparison of the total fixed assets of companies and the related calculations should be conducted with caution. Since companies record their fixed assets in the books based on historical prices, and they have different investment dates, then the assets and the profit/sales to assets ratio does not reflect the whole reality. It is necessary to take this issue into account when using the indicators related to the amount of assets of the companies in economic surveys and research.