SK Innovation announced on June 7 that it had generated KRW 3,038.3 billion in social value in 2022, marking a significant increase of 125% (KRW 1,687.5 billion) compared to the previous year.
The assessment of social value takes into account various categories, including Environmental Performance, which evaluates the environmental impact of the company's production processes and resource consumption.
It also considers Indirect Economic Contribution Performance, which measures factors like employment, dividends, and tax payments.
Additionally, Social Performance is evaluated based on labor practices, shared growth initiatives, social contribution, donations, and volunteer activities.
Analyzing the performance by sector in the past year, SK Innovation achieved its highest level of Environmental Performance since the introduction of social value measurement in 2018. With a decrease of 11% (KRW 107.8 billion) compared to the previous year, the company created a social value of minus KRW 851.9 billion.
This improvement was attributed to the innovation in their Green Portfolio, focused on electric vehicle (EV) batteries and battery materials, as well as their efforts to reduce greenhouse gas emissions for three consecutive years.
The Indirect Economic Contribution Performance saw a substantial increase of 74% from the previous year, amounting to KRW 3,726.8 billion (KRW 1,587.6 billion increase). Notably, this measurement now includes overseas business sites in the U.S., China, Europe, and other regions, contributing a total social value of KRW 527.7 billion.
SK Innovation's Environmental Performance was significantly enhanced by expanding their range of environmentally friendly products and services, particularly in EV batteries, battery materials, and recycled asphalt. The social value created by these offerings increased by 61% compared to the previous year.
The company is also proactively exploring new business models that align with the principles of a circular economy, such as plastic recycling, Battery Metal Recycling (BMR), and the upcycling of waste lubricants.
Moreover, SK Innovation has achieved noteworthy success in reducing carbon emissions. Through initiatives led by the Net Zero Council, the company implemented "Green Operation" measures that resulted in a reduction of over 14% compared to the carbon emission baseline of 2019 (12.43 million tons).
The Green Operation prioritizes low-carbon raw materials, optimizes facility operations to minimize carbon emissions, and promotes sustainability in the energy and chemical sectors.
With the inclusion of social value measurements from overseas business sites in North America, Europe, China, and other regions, the Indirect Economic Contribution Performance increased by KRW 1,587.6 billion compared to 2021. SK Innovation foresees a doubling of this performance by 2030, driven by the expansion of overseas business sites, particularly in the EV batteries and battery materials businesses.
In terms of Social Performance, SK Innovation has achieved tangible results by fostering mutual growth with partner companies and supporting green startups. The company has developed a business model to establish a resource circulation ecosystem through partnerships with small and medium-sized enterprises in waste plastic recycling technology and recycled asphalt.
Additionally, through the EGG program (SK + Green Startup), a collaborative effort involving the Korean government, major corporations, and venture capital, SK Innovation has identified and nurtured startups with environmental technologies for two consecutive years. To date, a total of 45 green startups have been supported by SK Innovation since 2019, with a plan to foster 100 startups by 2025.
“We will win the trust of the market and stakeholders by continuously demonstrating our social value creation and ESG performance,” said SK Innovation Vice Chairman & CEO Kim Jun. “We will accelerate the executive ability of our ‘Carbon to Green’ Financial Story strategy for this purpose.”
