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LG Innotek published the ‘2020-21 Sustainability Report’ that contains the company’s ESG achievements
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The company reorganized the ESG vision system and strengthened relevant organizational structure and activities
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“LG Innotek will reinforce ESG management to become a company lasting for 100 years”
LG Innotek (CEO Cheoldong Jeong) reduced greenhouse gas emissions by 11% in 2020 from the previous year. The total reduction amount is about 45,000 tons (tCO2eq, carbon dioxide equivalent), which is equivalent to the amount of greenhouse gas absorbed by 3.9 million trees in a year.
Considering that the company’s sales increased by 20% during the same period, it is a significant figure. For manufacturing companies, greenhouse gas emission generally rises as sales grow.
LG Innotek announced on the 12th that it had published the ‘2020-2021 LG Innotek Sustainability Report,’ which contains the company’s ESG (Environment, Social, Governance) efforts and achievements.
LG Innotek’s commitment to reinforce ESG management is well illustrated in this report. In the report, the company disclosed a new ESG vision and relevant organizational structure.
LG Innotek has established the ESG vision system that includes strategies and tasks for each ESG field with the vision of ‘Global No. 1 Material and Component Company to Bring a Better Tomorrow.’
Its relevant organizations were also reinforced. The ‘ESG Board Committee’ was established within the board of directors (BOD) to act as the supreme review board for ESG. In addition, the ‘ESG Executive Committee’ is running to promote company-wide ESG activities. The Executive Committee is chaired by the CFO, and relevant departments are participating.
Especially, this year’s report disclosed ESG management activities more in detail as per the global information disclosure standards to reinforce communication with stakeholders.
Along with it, the report introduced the company’s major environmental, social and governance-related efforts and achievements.
First, in the field of environment, LG Innotek has proactively performed green management activities with the goal of ‘zero environmental impact.’ Such activities include introducing renewable energy and expanding the application of high-efficiency production facilities to reduce greenhouse gas emissions. Through these efforts, the company saved the total energy cost of KRW 5.2 billion last year. Greenhouse gas emissions decreased by 11% from 2019, and the total reduction amount is about 45,000 tons.
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LG Innotek also cut its consumption of water resources by 7% from the previous year through expanding investment in recycling facilities and managing water usage by the unit of KRW.
In recognition of such achievements in eco-friendly management, LG Innotek received an A- rating from the Carbon Disclosure Project (CDP) on climate change for two consecutive years in 2019 and 2020 and on water security for four consecutive years between 2017 and 2020.
As for social responsibility, the company is continuing the activities for its employees, partners, and the local communities aiming to establish ‘the partnerships for elevating social value.’
For the employees, LG Innotek is promoting what it calls the PRIDE Activity to motivate the employees to become proud of their company. By selecting core domains that affect the employees’ pride, the company is actively undertaking more than 30 activities such as running a hub office, establishing a digital work environment, and improving in-house cafeteria meal service.
LG Innotek is also making efforts for mutual growth with its suppliers through technical and educational supports as well as financial support including a mutual growth fund of KRW 103 billion. In particular, the company is also scrutinizing ESG risks within the supply chain and improving the suppliers’ sustainable competitiveness by implementing supplier ESG assessments.
LG Innotek and its employees have also been active in their social contributions. The company has arranged non-contact social contribution programs in which the employees can participate to continue to give back to local communities even under COVID-19. Last year, LG Innotek supported about 37,000 youths and underprivileged neighbors through 163 beneficiary organizations domestically and internationally, spending a total budget of KRW 3 billion.
In the field of governance, the company is focusing on strengthening shareholder-friendly policies and the transparency of the BOD. This year, LG Innotek more than doubled dividend payments from the previous year and introduced an electronic voting system for the general shareholders’ meeting to assist shareholder rights.
As for the BOD, the company reinforced the autonomy of the Audit Committee by establishing an independent internal audit organization to support the committee. Besides, LG Innotek also established the Internal Transaction Committee under the BOD to improve transparency in related transactions among affiliates.
CEO Cheoldong Jeong said, “For a corporation to last for 100 years, it must fulfill social responsibilities while promoting the business competitiveness and customer value. LG Innotek will continue to strengthen the ESG management for sustainable growth.”
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