FairLabs Team
Sep 2, 2024
Weekly ESG Controversies (August 26 ~ September 1)
Key Takeaways
Improper Loans, Embezzlement, and Capital Market Law Violations
Controversy is intensifying as WOORI FINANCIAL GROUP faces allegations of improper loans to relatives, with ongoing raids at Woori Bank's headquarters following last week’s announcement of an investigation into KB Financial by the Financial Supervisory Service.
Ongoing controversies surround SILLAJEN, EHWA TECHNOLOGIES INFORMATION, and BIFIDO, with issues related to stock option disputes, embezzlement, and capital market law violations respectively continuing to draw attention.
Allegations of Market Dominance Abuse by NAVER
The People Power Party has demanded an investigation into NAVER, accusing the company of granting preferential treatment to politically biased media outlets and abusing its market dominance, fueling controversy.
Delays in Dongseoul Substation Expansion by KOREA ELECTRIC POWER Corporation
Concerns are growing over potential power supply disruptions to the Yongin semiconductor mega-cluster due to delays in the Dongseoul Substation expansion project, which has been denied by Hanam City.
YOUNGPOONG Seokpo Refinery CEO Arrested
The CEO of YOUNGPOONG’s Seokpo Refinery has been arrested on charges of violating the Serious Accident Punishment Act following a tragic arsenic gas poisoning incident that resulted in the death of a worker.
Demotion of HANMI PHARM CEO
Internal conflicts at HANMI PHARM have intensified after HANMI SCIENCE, the holding company, unexpectedly demoted the CEO of HANMI PHARM from president to executive vice president, escalating management disputes.
Business Ethics (23.87%)
Prosecutors are conducting a second day of raids on Woori Bank's headquarters in connection with allegations of illegal loans to relatives of WOORI FINANCIAL GROUP executives.
Both EHWA TECHNOLOGIES INFORMATION and BIFIDO are embroiled in controversy, with their chairmen either arrested for embezzlement or facing trading suspensions.
Competitive Behavior (14.16%)
NAVER is under scrutiny for alleged abuse of market dominance in the news partnership market.
Systemic Risk Management (10.58%)
Concerns about systemic risk are rising due to criticisms from the Gwangju City Council over delays in the Dongseoul Substation expansion and the suspension of new renewable energy permits by KOREA ELECTRIC POWER Corporation.
The merger between DOOSAN BOBCAT and DOOSAN ROBOTICS was canceled due to pressure from the Financial Supervisory Service and opposition from minority shareholders.
Employee Health & Safety (7.26%)
The CEO of YOUNGPOONG's Seokpo Refinery has been arrested on charges of violating the Serious Accident Punishment Act.
KUMHO TIRE and SAMSUNG ELECTRONICS are both under investigation and special inspection following incidents involving worker fatalities, continuing to attract controversy.
Employee Engagement, Diversity & Inclusion (6.76%)
Controversy has arisen after the sudden demotion of the CEO at HANMI PHARM to an executive vice president, causing significant internal debate.
The report underscores the diverse range of risks companies are currently facing, from ethical dilemmas and regulatory scrutiny to systemic risks and employee safety concerns. Each controversy not only impacts the involved company’s reputation but also poses broader questions about governance practices within their respective industries. It is crucial for stakeholders to monitor these developments closely as they may have far-reaching implications for corporate governance and sustainability.
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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