17 Domestic Companies Included in Dow Jones Sustainability Index

Korea Productivity Center Announces 2020 Dow Jones Sustainability Index (DJSI) Evaluation Results

[Asia Economy Reporter Kim Cheol-hyun] Seventeen domestic companies including Samsung Electro-Mechanics, Samsung Securities, S-Oil, Hyundai Engineering & Construction, Mirae Asset Daewoo, SK, LG Electronics, and Woongjin Coway were listed on the '2020 Dow Jones Sustainability World Index.'

The Korea Productivity Center (Chairman Noh Gyu-seong) disclosed the '2020 Dow Jones Sustainability Index (hereafter DJSI) evaluation results' including this information on the 14th. Since the first evaluation began in 1999, DJSI has marked its 22nd year this year and is recognized worldwide for its credibility in sustainability evaluation and investment. Since 2009, the Korea Productivity Center has jointly developed and announced DJSI Korea with the U.S.-based global financial information provider S&P Dow Jones Indices and the Swiss sustainability assessment specialist SAM (S&P Global Switzerland SA).

DJSI consists of the 'DJSI World Index,' which evaluates the top 2,500 global companies by free-float market capitalization; the 'DJSI Asia Pacific Index,' which evaluates the top 600 companies in the Asia-Pacific region; and the 'DJSI Korea Index,' which evaluates the top 200 domestic companies. The DJSI World Index included 323 companies, accounting for 12.7% of the 2,540 global companies evaluated. This year, 17 Korean companies were included. Samsung Electro-Mechanics was listed for 12 consecutive years, Samsung Securities, S-Oil, and Hyundai Engineering & Construction for 11 consecutive years. Mirae Asset Daewoo, SK, and LG Electronics were included for 9 consecutive years, Shinhan Financial Group for 8 consecutive years, Samsung Fire & Marine Insurance for 7 consecutive years, and Samsung SDI for 6 consecutive years. Woongjin Coway, KB Financial Group, and Hankook Tire & Technology were included for 5 consecutive years, Samsung C&T and SK Innovation for 4 consecutive years, and LG Household & Health Care and Hyundai Steel for 3 consecutive years.

In the DJSI Asia Pacific Index, 156 companies, accounting for 25.5% of the 611 evaluated companies, were included, with 29 domestic companies listed. Companies with long-term inclusion include Samsung SDI, Samsung Electro-Mechanics, Shinhan Financial Group, SK Telecom, LG Chem, KB Financial Group, and Hyundai Steel, all listed for 12 consecutive years. In the DJSI Korea Index, 42 domestic companies, accounting for 21.5% of the 205 evaluated companies, were included.

According to this year’s DJSI evaluation results, the average score of global companies rose by 1.0 point from last year to 77.1 points, and the average score of domestic companies increased by 1.1 points to 69.8 points, indicating an overall improvement in levels. However, the average score gap between global and domestic companies was 7.3 points, showing that further improvement in sustainability management levels is still needed for domestic companies.

2020 DJSI Inclusion Index Industry Average Comparison

By industry, domestic companies in home appliances, food and beverage, and steel industries exceeded the average scores of companies included in the DJSI World Index, confirming their global competitiveness. On the other hand, the machinery and equipment and facility industries showed a significant gap compared to global levels.

Among the DJSI evaluation categories, domestic companies improved in governance, ethics, and talent development compared to last year, but were still 25.7 points, 11.1 points, and 10.9 points lower respectively than global companies. In the climate change category, the evaluation score difference between global and domestic companies was 3.9 points. Kim Ha-kyung, a researcher at the Korea Productivity Center’s Sustainability Management Promotion Team, said, "Recently, improvements in domestic companies’ responses to climate change and human rights management have been confirmed, but there remains a significant gap with global companies in governance, risk, and talent development. In fact, gaps in governance, risk, and talent development have been confirmed for a long time. Follow-up changes are needed to improve evaluations."

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