The second annual State of Green Business Report used a GreenBiz Index - 20 areas that are essential to a green economy - and found clear progress since last year in only five of them: water use, energy efficiency, clean energy patents, investments in clean tech and recycling of paper.

Three areas showed backsliding - carbon emissions, electronic waste and telecommuting by employees - and the other areas showed little or no progress.

"What we found striking is that progress is coming much more slowly relative to the need for action," said Joel Makower, the executive editor of Greenbiz.com, in Oakland, which issued the report. "The problems are not getting any better."

Greenhouse gas emissions, for example, dropped only 0.6 percent per unit of gross domestic product, according to the report - the smallest drop in seven years. The number of new consumer electronics products in the last year far outweighed the number recycled. Capital investments in green buildings remained flat, even though more companies have committed to building them.

Companies are getting more methodical about how they measure their environmental impact, Makower said, and they're better at understanding it in more detail.

S.C. Johnson & Son, which makes Windex and other household cleaners, classifies everything that goes into its products - including the ingredients and the packaging - according to a Greenlist that measures their impact on the environment and human health. Managers are challenged to improve their products' scores every year.

But there's still much work to be done, he said, including government policies that set prices which reflect the true costs of using energy and polluting the environment.

To see the full report, go to www.greenbiz.com.

E-mail Deborah Gage at dgage@sfchronicle.com.

This article appeared on page C - 2 of the San Francisco Chronicle