SK Lubricants has reinforced its ESG⁽¹⁾ practice and established its vision slogan “Make It Move, Make It Green” through a contest within the company in accordance with our Green Balance management strategy. This means that we will make all objects keep moving, which is the basic role of the lubricants and, moreover, make them green by making all movements work effectively and efficiently. Correspondingly, by defining our mission as “Beyond Lubricants, we accelerate sustainable future”, we will not just stay as a base oil/lubricants producer and provider but we will keep getting ahead for a sustainable, eco-friendly future.

(1) ESG: Environmental, Social and Governance (ESG) criteria are a set of standards to measure the sustainability and social impact of an investment in a business or a company

Beyond economic values, all affiliate companies of SK Innovation are strengthening eco-friendly businesses to reinforce the management of ESG. This is in line with the global trend of responsible investment that uses evaluation of the ESG index. SK Lubricants will accelerate implementing the Green Balance strategy by setting three core pillars to implement eco-friendly strategies.

First, we will focus on eco-friendly products such as the premium base oil YUBASE PLUS, and the ultra-low viscosity products ZIC ZERO that contributes to carbon dioxide (CO₂) reduction to expand the global market. The market for eco-friendly lubricants is expected to increase by an average of 13% by 2025 due to strict regulations on automobile emission and fuel efficiency, and demand for high-end lubricants for automobiles is increasing by more than 10 percent every year. The premium lubricant base oil (YUBASE / YUBASE PLUS) supplied by SK Lubricants plays a crucial role in reducing carbon emissions from automobiles. In particular, the amount of CO₂ reduced by high-efficiency engine oil made from SK Lubricants’ premium lubricant base oil, is estimated to be about 14 million tons per year. Through expanding the supply of the premium lubricant base oil and Ultra High-end products, we will transform into a company specializing in eco-friendly ultra-low viscosity lubricants.

Second, we plan to develop a variety of lubricant products in line with the electric vehicle era. SK Lubricants is already pre-emptively supplying EV Fluid exclusively for electric vehicles to major global automakers. We are rapidly expanding our supply in the electric vehicle market by developing lubricant products specialized for each electric vehicle. We are continuing our research not only on lubricants for motors and gearboxes of electric/hybrid vehicles, which are already growing rapidly, but also lubricant solutions from the viewpoint of integrated thermal management of batteries in electric vehicles and ESS⁽²⁾.

(2) ESS: Energy Storage System

Third, we will provide lubricant solutions that contribute to a sustainable environment and energy. Demand for onshore/offshore wind power generation energy, a sustainable energy source, is rapidly growing by 10% every year, and thus we plan to target this market by developing and supplying various lubricating oil products that are needed for the stable and efficient operation of wind power generation facilities. In addition to the growing needs for renewable energy, the needs for eco-friendly lubricants are snowballing, and regulations on the use of eco-friendly lubricants in accordance with environmental regulations have begun in Europe and the US for sustainable use. SK Lubricants will further strengthen its position as an eco-friendly company by developing and expanding the market of biodegradable products that can be easily decomposed in nature.

SK Lubricants puts the environment first in every business area according to its eco-friendly strategy. We’ve recently changed the previous SK ZIC packaging to a container made of recycled plastic and received the “Eco-friendly certification for recycling plastic wastes” through UL KOREA⁽³⁾. We are also making efforts to increase resource circulation to obtain “Zero waste to landfill” certification.

(3) UL Korea: UL LLC is a global safety certification company headquartered in Northbrook, Illinois. UL Korea is among 46 offices of UL worldwide. (reference)

On the other hand, we are gradually making changes in our corporate culture, corporate management system, and the whole corporate structure in general to fit the shape of global business. We aim to break the old image of a Korean company that simply runs global business and reborn with a new identity as a true global corporation.

I am aware of the concern that the existing lubricant business may lose ground in the era of eco-friendly electric vehicles. However I believe hybrid vehicles will be our focus for a while, and the era of electric vehicles can also be a new opportunity for us. According to the changes of business environment, SK Lubricants will expand its green portfolio and transform into an Eco-Oriented Global Company that pursues both economic and environmental values through practical eco-friendly actions.”