SK Leading Carbon Neutrality... Materials Division Starts, Early Achievement Across All Affiliates (Comprehensive)

Choi Tae-won Emphasizes Group-Level 'Financial Story' on Semiconductors and Water
"Net Zero (Carbon Neutrality) Is Not a Choice but a Matter of Competitiveness"

[Asia Economy Reporter Hwang Yoon-joo] SK Group Chairman Chey Tae-won has proposed advancing the timeline for achieving net-zero greenhouse gas emissions across all SK affiliates, starting with SK Materials in 2030, ahead of the global target year of 2050. Net-zero refers to the point at which carbon emissions and reductions balance out to zero. While many individual companies in South Korea have recently joined the carbon neutrality movement amid the global focus on climate change, SK Group is the first to set an earlier target for all its affiliates at the group level.

On the 22nd, Chairman Chey Tae-won attended the '2021 Expanded Management Meeting' held at the SKMS Research Institute in Icheon, Gyeonggi Province, and stated, "When semiconductors, hydrogen, and other sectors are developed into a financial story at the group level, it can gain market approval," urging the group to accelerate carbon neutrality efforts across the entire organization. ▶Related article page 3

The financial story is a management theme first introduced by Chairman Chey last year, emphasizing the establishment of ESG (Environmental, Social, and Governance) management to receive proper corporate value evaluations from internal and external stakeholders. Reflecting Chairman Chey’s intention to complete the financial story through ESG management, SK Group’s major affiliates became the first Korean companies to join RE100 (committing to 100% renewable energy) in November last year.

Chairman Chey emphasized, "Considering that carbon prices are expected to rise faster than anticipated, net-zero is not a matter of whether to do it or not, but a matter of competitiveness," adding, "If we move faster than others, our strategic options will expand, and ultimately, we can win in the competition."

As part of this, the SK CEOs attending the meeting jointly resolved the ‘2050-α’ initiative, aiming to achieve net-zero greenhouse gas emissions ahead of the global carbon neutrality target date to overcome the climate crisis. SK Materials, an affiliate in the semiconductor and battery materials business, will advance its target to 2030, while other affiliates have also set plans for early achievement. Each SK Group affiliate will set interim targets at least every 10 years and disclose the results annually.

Accordingly, SK Group expects to reduce carbon emissions across all affiliates by 35% from last year’s levels by 2030. The goal is to reduce emissions by 85% by 2040. Compared to a scenario without any carbon reduction efforts, the company anticipates a 93% reduction by around 2040.

Chairman Chey stated, "Our group has led the environmental sector with hydrogen, batteries, and RE100, achieving many results through various deep change methodologies such as business model innovation, social value, double bottom line (DBL), shared infrastructure, and ESG," adding, "Now, if we integrate these methodologies into one framework and communicate and implement them in a way that stakeholders can empathize with, we will ultimately gain trust and achieve greater results."

Additionally, Chairman Chey introduced the concept and necessity of a 'good financial story' with the keyword ‘synchronize’ on the day. He emphasized that all elements?from each company’s future vision to board operations and member evaluations?should harmonize like interlocking gears within the financial story, and that customized stories should be presented for each stakeholder group.

This content was produced with the assistance of AI translation services.