Trustmark, Walgreens Join 'Clean Stocks' List

Rose, the CEO of Expeditors International (EXPD Quote), earned a base salary of just $110,000 in 2002. Roche, president and CEO of T. Rowe Price (TROW Quote), earned just $300,000.

Ever heard of Rose or Roche? Probably not, as all they've done is run their companies in ways that investors can trust. Digging to find companies that you can trust with your money is worth the effort. For the last 10 years, the cumulative return on the S&P 500 is 126%, and it's 152% on the Nasdaq Composite. In the same period, shares of T. Rowe Price are up 539% and Expeditors International 2,156%.

Stocks of companies that behave well toward shareholders often are, but obviously not always, superior long-term investments.

That's the premise behind the growing list in my Clean Stocks project.

The process works like this: Each month or so, I nominate three candidates for inclusion on the list from suggestions readers have sent me. That lets us harness the combined knowledge of everyone who reads Jubak's Journal.

In the month after the nomination, I do due diligence on each stock and so do readers who send in whatever they know about them. At the end of that, I report which companies made the list and which didn't and why. And ask for another three nominations.

If at any point a reader or I come up with something that makes us question the company's place on this list, I'll review the selection.

Companies and their stocks are judged in eight areas: executive compensation, accounting, conflicts of interest, growth strategies, corporate structure, options accounting, pension accounting and potential return to investors. Clean Stocks almost certainly will have a blemish or two, but the bad marks should be limited and, ideally, immaterial to their investment quality.

Last month's nominees were Southwest Airlines (LUV Quote), Trustmark (TRMK Quote) and Walgreens (WAG Quote).

Let's see how they did.