JC Atkinson and Son beat off competition from multimillion-pound companies with thousands of employees to land the title.

The third generation family firm, based on the Wear Industrial Estate, Washington, produces 60,000 coffins a year.

It has won numerous environmental awards for its commitment to using wood drawn from sustainable forests.

Now it has added another by topping the inaugural Sunday Times Green List, beating construction giant Carillion into second place with Co-operative Financial Services third.

It was a quadruple success at the ceremony at London's South Bank this week, as the firm also won the regional title, was named best small company with a high or medium environmental impact, and scooped a special award for outright environmental performance.

Managing director Julian Atkinson was delighted with the achievement, which has followed years of working towards becoming carbon neutral.

He said: "It has been our company policy to make our coffins stand out from the rest of the marketplace by having a more environmental approach, in buying materials and manufacturing.

"We just researched the best ways to do things. A lot of what we do behind the scenes doesn't always get noticed.

"Now the environment is more of a mainstream issue it's really fitted into place."

As well as using wood from sustainable forests, JC Atkinson – which was established in 1936 – saves 50,000 litres of drinking quality water per year by collecting rainwater from its factory roof.

The firm has also recently installed a biomass generator, which uses sawdust and wood off-cuts to produce heat and electricity for the factory, as well as surplus for the National Grid.

Its Washington factory operates 24-hours-a-day and coffins leave the site in the middle of the night to make transport more efficient.

The awards also honoured social housing firm gentoo – formerly Sunderland Housing Group – named fifth best green company in the North.

Sally Hancox, director of gentoo green, said: "We are only one year into our journey in becoming more environmentally sustainable, so to be recognised for our efforts at such an early stage is fantastic and a fitting reward for the enthusiasm and commitment of our staff.

"As an organisation we are always seeking to learn, and this provides us with a brilliant opportunity to see what other companies are doing to help the environment and to use this knowledge to improve our own practices and hopefully do even better next year."