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ESG Weekly Review | South Korea ESG Controversies for September 30 - October 6, 2024

ESG Weekly Review | South Korea ESG Controversies for September 30 - October 6, 2024

ESG Weekly Review | South Korea ESG Controversies for September 30 - October 6, 2024

ESG Weekly Review | South Korea ESG Controversies for September 30 - October 6, 2024

FairLabs Team

2024. 10. 7.

Weekly ESG Controversies (September 30 ~ October 6)


Key Takeaways


  • Corporate Governance Concerns at KOREA ZINC: Korea Zinc is entangled in a legal battle with Youngpoong, raising significant concerns about corporate governance and decision-making transparency in the metals and mining sector.


  • Financial Misconduct at WOORI FINANCIAL GROUP: Woori Financial Group is under scrutiny for its third financial scandal in 2023, intensifying calls for enhanced accountability in the banking sector.


  • Regulatory Challenges for KAKAO: Kakao Mobility has been fined 72.4 billion won for anti-competitive behavior, reflecting broader regulatory pressures on South Korea’s tech industry.


  • Labor Issues at SAMSUNG ELECTRONICS: Samsung is facing criticism for its labor practices following workforce reductions and safety violations, underscoring systemic labor management challenges.




  1. Business Ethics (23.62%)

    • KOREA ZINC & YOUNGPOONG Dispute: The ongoing legal battle between Korea Zinc and Youngpoong over stock offerings and corporate governance failures remains a significant concern, affecting investor confidence and raising questions about leadership accountability.

    • WOORI FINANCIAL GROUP: Multiple cases of financial misconduct have surfaced, including a 5.5 billion won loss due to false documentation and allegations of improper loans linked to the former chairman’s relatives..


  1. Competitive Behavior (16.23%)

    • KAKAO Mobility’s Market Dominance Abuse: Kakao Mobility's substantial fine for blocking competitor services marks a pivotal moment in South Korea’s regulatory push to curb anti-competitive practices in the tech sector.

    • SAMSUNG ELECTRONICS’ Antitrust Allegations: Samsung faces a lawsuit from Epic Games over its restrictive app distribution policies, signaling rising scrutiny over monopolistic behavior in the tech industry.


  1. Labor Practices (8.85%)

    • SAMSUNG ELECTRONICS & Worker Rights: Criticism is mounting over Samsung’s handling of labor rights, particularly in its overseas subsidiaries, where protests and potential layoffs have sparked public backlash.

    • HYUNDAI and KIA’s Labor Negotiations: Hyundai and Kia are actively renegotiating terms with labor unions, reflecting the rising power of worker organizations in advocating for better employment conditions.


  1. Employee Health & Safety (7.75%)

    • HANWHA OCEAN Safety Violations: Hanwha Ocean’s repeated safety infractions, coupled with significant fines, underscore the company’s failure to uphold basic safety standards, prompting union backlash and reputational risks.

    • SAMSUNG ELECTRONICS & Safety Oversight: The company faces criticism for its inadequate radiation safety management after a recent employee exposure incident, potentially exposing the company to regulatory penalties.


  1. Systemic Risk Management (4.57%)

    • NAVER’s Inadequate Crisis Management: Naver’s recent service disruptions due to an inadequate disaster management plan have attracted government scrutiny, highlighting the need for robust risk mitigation strategies in tech companies.

    • KAKAO’s Repeated Service Outages: Kakao faces regulatory interventions due to frequent service disruptions, indicating systemic weaknesses in its operational risk management.


This week’s ESG controversies reveal deep-rooted issues across governance, competitive behavior, labor practices, and environmental compliance. Companies like Korea Zinc and Woori Financial Group are facing significant challenges that threaten to erode investor confidence. The tech sector, represented by Kakao and Samsung, continues to grapple with regulatory pressures and labor management issues, signaling a need for strategic reforms. Meanwhile, the safety and compliance failures at Hanwha Ocean highlight the ongoing challenges in maintaining high standards in high-risk industries.

The unfolding events underscore the growing demand for enhanced ESG strategies, particularly in governance and labor relations, to mitigate reputational and operational risks in the long term.



Disclaimer: This content was made with the help of AI. It may contain errors or inaccuracies, and should not be relied upon as a substitute for professional advice. The information contained in this article is not investment advice. FairLabs does not endorse or recommend any investments and assumes no liability for any consequence relating directly or indirectly to any action or inaction taken based on the information contained in this article.

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Reach Us

FAIR LABS CO., LTD.

83 Uisadang-daero, Yeongdeungpo-gu, Seoul

team@fairlabs.io

Copyright 2024. All Rights Reserved.

Reach Us

FAIR LABS CO., LTD.

83 Uisadang-daero, Yeongdeungpo-gu, Seoul

team@fairlabs.io

Copyright 2024. All Rights Reserved.