21 Korean Companies Included in Dow Jones Sustainability Index

Korea Productivity Center Announces 2021 Dow Jones Sustainability Index (DJSI) Evaluation Results

[Asia Economy Reporter Kim Cheol-hyun] According to the 2021 Dow Jones Sustainability Index (hereinafter DJSI) evaluation results, 21 Korean companies were included in the DJSI World index, which targets the top 2,500 global companies. Since its first evaluation in 1999, DJSI has marked its 23rd year this year and is recognized worldwide for its credibility in sustainability assessment and investment.

On the 13th, the Korea Productivity Center (Chairman An Wanki, hereinafter KPC) disclosed the 2021 DJSI evaluation results. Since 2009, KPC has jointly developed and announced DJSI Korea with S&P Dow Jones Indices, a global financial information provider based in the United States.

◆21 Korean Companies Included in DJSI World Index=DJSI consists of the DJSI World index, which targets the top 2,500 global companies by 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.

According to this year’s evaluation, 322 companies, accounting for 12.7% of the 2,544 global companies evaluated, were included in the DJSI World index, with 21 Korean companies among them. In the DJSI Asia Pacific index, 153 companies, or 25.1% of the 609 evaluated companies, were included, with 32 Korean companies among them. In the DJSI Korea index, 43 Korean companies, or 21.2% of the 203 evaluated companies, were included.

Looking at the detailed inclusion status, Samsung Biologics, SK Telecom, Kakao, Hyundai Motor, Hyundai Glovis, and Hyundai Mobis were newly included in the DJSI World index. Samsung Electro-Mechanics was included for 13 consecutive years; Samsung Securities, S-Oil, and Hyundai Engineering & Construction for 12 consecutive years; Mirae Asset Securities, SK, and LG Electronics for 10 consecutive years; Shinhan Financial Group for 9 consecutive years; Samsung SDI for 7 consecutive years; Coway, KB Financial Group, and Hankook Tire & Technology for 6 consecutive years; Samsung C&T for 5 consecutive years; and LG Household & Health Care and Hyundai Steel for 4 consecutive years.

Newly included companies in the DJSI Asia Pacific index are Doosan Heavy Industries & Construction, Samsung Biologics, Woori Financial Group, Kakao, and Hyundai Motor. Long-term included companies are Samsung SDI, Samsung Electro-Mechanics, Shinhan Financial Group, SK Telecom, LG Chem, KB Financial Group, and Hyundai Steel for 13 consecutive years; Mirae Asset Securities, Samsung Securities, SK Hynix, S-Oil, LG Household & Health Care, LG Electronics, GS Engineering & Construction, Hyundai Engineering & Construction, and Hyundai Mobis for 12 consecutive years; and SK for 10 consecutive years.

Newly included companies in the DJSI Korea index are Samsung Biologics, SK Chemicals, LG Innotek, and Kakao. Long-term included companies include DB Insurance, Samsung Electro-Mechanics, Samsung Securities, Samsung Fire & Marine Insurance, Shinhan Financial Group, LG Electronics, LG Chem, OCI, KB Financial Group, KEPCO KPS, and Hyundai Engineering & Construction, all included for 13 consecutive years; Hyundai Doosan Infracore, Mirae Asset Securities, Amorepacific, SK, and Hyundai Mobis for 12 consecutive years; and Samsung Engineering, Samsung Heavy Industries, SK Hynix, and Hankook Tire & Technology for 11 consecutive years.

◆Improvement of Domestic Companies Compared to Global Companies=The average score of global companies in 2021 was 76.5 points, down 0.6 points from the previous year. The average score of domestic companies rose 1.1 points from the previous year to 70.9 points, showing an overall improvement. The average score gap between global and domestic companies was 5.6 points, indicating that domestic companies still need to improve their sustainability management levels, but this is a 1.7-point improvement from the 7.3-point gap in 2020.

Domestic companies showed excellent performance and global competitiveness in the food, oil and gas, home appliances and leisure goods, automobile, automobile parts, financial services, steel, and transportation and infrastructure industries. The food (78 points) and oil and gas (89 points) industries scored about 4 points higher than the global average; home appliances and leisure goods (75 points) scored 3 points higher; automobile (77 points) 2 points higher; automobile parts (77 points) and financial services (75 points) 1 point higher each. The steel (77 points) and transportation and infrastructure (75 points) industries scored the same as the global average.

Among the DJSI evaluation categories for domestic companies, environmental policy and systems (83.1 points) and personal data protection (70.7 points) increased by 2.6 points and 18.0 points respectively from the previous year, and were 8.0 points and 2.1 points higher than global companies, confirming excellent performance. On the other hand, governance (36.0 points), risk management (62.0 points), talent attraction and retention (65.3 points), climate change strategy (74.4 points), and code of ethics (75.3 points) were 26.4 points, 16.0 points, 7.0 points, 10.2 points, and 8.2 points lower than global companies respectively, showing a significant gap. However, governance (1.1 points), code of ethics (2.6 points), and talent attraction and retention (3.3 points) improved compared to last year, narrowing the gap, while risk management (2.3 points) and climate change strategy (11.0 points) scores declined compared to last year.

KPC Chairman An Wanki said, "As ESG information utilization and socially responsible investment are activated in the capital market, the importance of evaluation criteria to measure and compare ESG performance is increasing," and emphasized, "While many companies have so far focused on areas that are easy to improve to increase their total ESG scores, now is the time to focus on core issues such as climate change." Chairman An added, "It is more urgent than ever to build company-wide consensus, secure budgets, and achieve results for agendas requiring mid- to long-term directions such as carbon neutrality."

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