SK Chemicals has earned the highest grade in a global assessment of environmental, social and governance performance, winning praise for decarbonization efforts, environmental risk management and a board-centered governance structure.
The company said on the 30th that it received AAA, the top grade, in the ESG assessment by MSCI (MSCI Inc.). SK Chemicals is the only Korean company to hold an AAA rating in the Commodity & Diversified Chemicals sector as classified by MSCI.
The MSCI ESG assessment evaluates how well a company manages environmental, social and governance risks and opportunities relative to global peers. Ratings range across seven levels, from AAA to CCC.
SK Chemicals moved up from BBB in 2021 to A in 2022 and AA in 2023 before reaching AAA for the first time this year. The company attributes the upgrade to its response in environmental areas, including a decarbonization program, an environmental management system and water stress management, as well as its board-centered governance.
SK Chemicals is pursuing a medium- to long-term carbon reduction roadmap that includes expanding the use of renewable energy and shifting to low-carbon fuels. All of its business sites have a system for regularly reviewing environmental risks based on ISO 14001, the international environmental management standard. The company is also strengthening water stress management by analyzing risks tied to water resources used at its sites and setting targets to cut consumption.
In governance, the company runs a board-centered decision-making system and is focusing on improving the board's expertise and independence. SK Chemicals plans to continue analyzing ESG risks and opportunities across its businesses and to carry out its medium- to long-term ESG targets.
"ESG has gone beyond declarative activity aimed at contributing to the environment and society to become an essential competitive factor that assesses the impact of business activity on society as a whole and raises a company's credibility and transparency," SK Chemicals President Ahn Jae-hyun said. "We will preemptively strengthen our management systems in line with assessment criteria and expectations, and build up our capabilities in each ESG area."
