■ Total social value performance in 2022 recorded KRW 3,038.3 billion, an increase by KRW 1,687.5 billion compared to the previous year
■ The achievement led by Green Portfolio innovation and 14% reduction in carbon emissions over 3 years
On June 7, SK Innovation announced that it created KRW 3,038.3 billion of social value in 2022, and it is a 125% (KRW 1,687.5 billion) increase compared to the previous year.
Social value is measured by throughout multiple categories including: the Environmental Performance that evaluates production processes of products and services related to resource consumption and environmental pollution; the Indirect Economic Contribution Performance that measures employment, dividends, and tax payment; and the Social Performance that measures social values created in areas such as labor, shared growth, social contribution, donation, and volunteer activities.
Delving into last year’s performance by sector, the Environmental Performance of SK Innovation reached its highest level since the start of social value measurement in 2018. It created a social value of minus KRW 851.9 billion, an improvement by 11% (KRW 107.8 billion) compared to the previous year, on account of the Green Portfolio innovation centered around electric vehicle (EV) batteries and battery materials, and the reduction of greenhouse gases for three consecutive years. The Indirect Economic Contribution Performance achieved KRW 3,726.8 billion, an increase by 74% from the previous year (KRW 1,587.6 billion). Regarding the Social Performance,” it recorded KRW 163.4 billion, a decrease by 5% from the previous year (KRW 7.9 billion). In particular, this is the first time that the social value performance of SK Innovation was measured by including overseas business sites in the U.S., China, Europe, and so on, of which total social value recorded KRW 527.7 billion in total.
◆ Continuous expansion of the Green Portfolio led to a 14% reduction in carbon emission over 3 years
SK Innovation improved its Environmental Performance significantly by expanding its products and services related to the environment for social value creation, including EV batteries, battery materials, and recycled asphalt. The social value created by the products and services related to the environment last year surged by 61% compared to the previous year. In addition to expanding existing core products and services, SK Innovation is also preparing for new business models through the realization of a circular economy, such as plastic recycling, Battery Metal Recycling (BMR), and upcycling of waste lubricants.
The company also achieved notable success in carbon emission reduction. Led by the Net Zero Council, it pushed forward with the “Green Operation” and achieved a reduction by more than 14% compared to the carbon emission baseline of 2019 (12.43 million tons). The Green Operation optimizes facility operations by taking into account carbon emissions, prioritizes the introduction of low-carbon raw materials by reflecting Carbon Value, and reduces the carbon emissions of energy and chemical businesses.
◆ New measurement of global performance and the expansion of ESG ecosystem including green startups
The Indirect Economic Contribution Performance was increased by KRW 1,587.6 billion compared to 2021 as the company started including the measurement of social values of overseas business sites in North America, Europe, China, etc. SK Innovation predicts that the Indirect Economic Contribution Performance around 2030 will be more than double that of 2022 if the number of new employees keeps increasing according to the expansion of overseas business sites, especially EV batteries and battery materials businesses.
Regarding the Social Performance, the company created tangible results, such as strengthening mutual growth with partner companies and fostering green startups. SK Innovation has developed a business model to build a resource circulation ecosystem in waste plastic recycling technology and recycled asphalt through partnerships with small and medium-sized companies. Moreover, the company also discovered and fostered startups that own environmental technologies through a program called EGG (SK + Green Startup) in collaboration with the Korean government, major corporations, and venture capital for 2 consecutive years. As of last year, a total of 45 green startups have been nurtured by SK Innovation since 2019, and it plans to foster 100 startups by 2025.
SK Innovation Vice Chairman & CEO Kim Jun said, “We will win the trust of the market and stakeholders by continuously demonstrating our social value creation and ESG performance.” “We will accelerate the executive ability of our ‘Carbon to Green’ Financial Story strategy for this purpose,” he added.
Kim Jun, Vice Chairman & CEO of SK Innovation, introduced the direction of SK Innovation’s Green Portfolio with its will to innovate business models during his keynote speech at the SK Innovation Global Forum held in San Jose, California, USA in June 2022.