"Overcoming 'ESG Risks' Requires Addressing Social Issues (S) Such as Industrial Accidents and Human Rights"

FKI Hosts 'Key Issues in ESG S Sector' Briefing
Focus on Human Rights, Industrial Accidents, Supply Chains
Kim Moon-soo, Chairman of the Economic and Social Council, Also Calls for "Easing Dual Labor Market Structure"

On the 28th, the World Day for Safety and Health at Work, participants hold placards at the Korean Confederation of Trade Unions rally titled "The Right to Work Without Dying" held in front of the Seoul Regional Employment and Labor Office in Jung-gu, Seoul. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Moon Chaeseok] Among ESG (Environment, Social, Governance), which has emerged as a key topic in global corporate management, responses in the 'S (Social)' sector such as human rights, industrial safety, and supply chain are expected to become key factors in reducing ESG risks.

At the 'ESG Social (S) Sector Major Issues Briefing' held by the Federation of Korean Industries (FKI) on the afternoon of the 11th, remarks were made emphasizing that resolving major social agendas is essential to mitigating risks. The briefing was held for 50 member companies and their responsible practitioners belonging to the K-ESG Alliance.

Kwon Tae-shin, FKI Senior Vice Chairman, said in his opening remarks, "Recently, supply chain due diligence guidelines have been announced in overseas countries such as the European Union (EU), and with the full enforcement of the Serious Accidents Punishment Act domestically, companies need to respond in various areas including human rights, industrial safety management, and supply chain ESG support. To enable domestic companies to play a more active role on the global stage, discussions on support measures in these areas must be conducted." Kim Moon-soo, Chairman of the Economic, Social and Labor Council, said in his congratulatory speech, "ESG management is something that labor, management, and government must create together," adding, "Only by alleviating the dual structure of the labor market through social dialogue can ESG management become smoother."

Participants in the briefing emphasized the need to ▲prepare specific human rights guidelines to respond to global due diligence ▲establish procedures for risk assessment and disaster prevention ▲manage supply chain ESG in line with the global restructuring of supply chains. Woo Jong-gil, Human Rights Officer at the Office of the United Nations High Commissioner for Human Rights, who gave a presentation on the UN Guiding Principles on Business and Human Rights, explained, "Unlike the early human rights discussions where there was no general consensus on what human rights standards should apply to companies, the UN Guiding Principles on Business and Human Rights (UNGPs) contain a broad consensus among stakeholders on corporate responsibility to respect human rights."

Officer Woo stated, "Companies must now understand human rights risks as business risks and prepare specific human rights guidelines to reduce corporate human rights risks," adding, "As legislative and mandatory movements regarding corporate human rights due diligence continue in various countries overseas, sustained interest from all sectors is needed domestically to develop corporate manuals on these issues."

Kim Sung-joo, a lawyer at Kim & Chang law firm who gave a presentation on industrial safety management, said regarding the Serious Accidents Punishment Act, which was enforced in January, "Attention must be paid to the possibility of excessive investigations and prosecutions in the early stages of enforcement." Lawyer Kim said, "In investigations related to the Serious Accidents Punishment Act, determining the applicable scope of the law and identifying management responsibility are important factors," adding, "Judgments on construction project owners, reviews on whether specific accidents qualify as industrial accidents, and criteria for identifying management responsibility need to be established through sufficient discussion." He emphasized that since the law aims at prevention rather than post-penalty, focus should be on disaster prevention through the establishment of risk assessment procedures.

Kim Dong-soo, Director of the ESG Management Research Institute at Kim & Chang, who presented on supply chain ESG management, explained, "The global supply chain restructuring strategies currently being promoted, such as the global supply chain solidarity strategy, are based on ESG frameworks like the EU Supply Chain Due Diligence Act." He stressed, "It is important to keep in mind that ESG indicators such as human rights, circular economy, renewable energy (RE100) usage, and waste reduction are being used as standards for global supply chain restructuring." Key corporate tasks to focus on for supply chain ESG management include ▲improving corporate energy efficiency ▲responding to domestic and international supply chain due diligence ▲managing ESG performance including second- and third-tier suppliers.

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