What is ESG?

The term ESG (Environmental, Social, Governance) emerged in 2004, from a provocation by the secretary general of the United Nations (UN), Kofi Annan, to 50 CEOs of financial institutions through the publication Who Cares Wins of the Global Compact and World Bank.

The ESG serves to measure the awareness of companies in relation to their behavior in relation to social, environmental and governance aspects.

Therefore, it is also used as a result indicator to measure the value of the company and the impact of its actions.

What are the benefits for the Company?

  • Improve financial performance

  • Increases investor confidence

  • Ensures consumer loyalty

  • Strengthens the positive image of the company

  • Increases talent retention and satisfaction

  • Reduce costs and waste

  • Ensures transparency

  • Mitigate risks

How it works?

The most important themes related to the company’s activities are called material themes.

These material topics are analyzed based on the Company’s business strategy and also on the perception of interested parties (Stakeholders) of the impact of its activities.

As a result, goals and indicators are created, analyzed and constantly improved in order to ensure alignment with the company’s purpose and its role in society.

Environmental

Refers to the practices of the company or entity focused on the environment. Here you will find topics such as:

  • Climate change (carbon footprint reduction; “Net Zero” carbon neutrality and expansion of renewable energies; mitigation and adaptation to climate change)

  • Water resources (management and use of these resources)

  • Biodiversity and ecosystem services (assessing and protecting biodiversity related to business activities)

  • Circular economy and waste management

  • Environmental management and pollution prevention

  • Building infrastructure

Social

Relates to social responsibility and the impact of companies and entities on behalf of the community and society. Mainly, it refers to topics such as:

  • Social dialogue and territorial development (Strategic social contribution; Innovation and technology)

  • Human rights

  • Diversity, equity and inclusion

  • Work relations and practices (Labor relations; work safety; Mental health; Employee development; and education promotion)

  • Promotion of social responsibility in the value chain

  • Product quality and safety

  • Security and protection of personal data

Governance

It is linked to the management policies, processes, strategies and guidelines of companies and entities. They include, for example:

  • Corporate governance (Code of Ethics and Conduct; Reporting Channel; Management of the Integrity and Compliance Program; Compliance with the legal and regulatory environment; Protection of Privacy and Personal Data (LGPD); Prevention of Unfair Competition (Antitrust); Anti-Corruption; Money Laundering Prevention; Internal Audit; Corporate Citizenship – Company Free from: Harassment, Slave Labor, Environmental Pollution, etc.)

  • Business Conduct

  • Control and Management practices

  • Transparency in management

How can I learn more about this topic?

We are preparing a training trail for you that will be available throughout 2023 at Hyundai University.

Through these trainings, you will be able to understand, identify your participation in this scenario and put activities into practice in a more sustainable way and in line with the Company’s strategy.

Today Hyundai publishes its sustainability report, which includes ESG practices, globally and can be accessed through the website:

CLICK HERE TO ACCESS