Climate Change Data

Hankook & Company Co., Ltd.

Climate Impact & Sustainability Data (2022)

Reporting Period: 2022

Environmental Metrics

ESG Focus Areas

  • Environment
  • Social
  • Governance

Environmental Achievements

  • Obtained the first international sustainable certification, ISCC PLUS, among the tire industry to actively use and transparently manage sustainable raw materials.
  • Developed tires containing 45% sustainable raw materials and tires containing 55% sustainable raw materials.
  • Reduced greenhouse gas (GHG) emissions from across the supply chain including tire manufacturing plants.

Social Achievements

  • Won ‘Happiness Award’ in Donation Category at 9th Annual CCK Grand Prize for continuous donations to the Community Chest of Korea (CCK) since 2003.
  • Established Hankook Donggeurami Partners, a subsidiary that hires mentally/physically-challenged people.
  • Implemented various social contribution activities tailored to local conditions to contribute to the development of local communities and strengthen ties with local residents.

Governance Achievements

  • Hankook & Company Group has established a globally-recognized corporate governance structure and ensures transparency and accountability in business conduct.
  • Operates robust internal control systems to ensure transparency in generating business outcomes.
  • Has an ESG Committee within the BOD that reviews and decides on environmental, social, and governance management activities.

Climate Goals & Targets

Long-term Goals:
  • Achieve carbon neutrality (Hankook Tire)
Medium-term Goals:
  • Reduce carbon footprint from product manufacturing and major business operations by reducing both direct GHG emissions (Scope1) and indirect GHG emissions (Scope2) by 46.2% by 2030 from the 2019 level, and value chain emissions (Scope3) by 27.5% by 2030 from the 2019 level (Hankook Tire)
  • Achieve the target of securing 100% sustainable material techniques (Hankook Tire)
Short-term Goals:
  • Increase OE tire supply for global top-tier automakers (2023)
  • Expand OE tire supply for EVs (2023)
  • Expand business with local Chinese car OEMs and Japanese car OEMs (2023)
  • Raise the share of high-inch tires (2023)
  • Develop new technology that caters to the evolving global automobile market (2023)
  • Expand supply of run-flat tires, foam-filled tires, and other specialty tires (2023)
  • Focus on development of advanced tires for EVs, hybrid vehicles, plug-in hybrid vehicles, and other next-generation vehicles (2023)
  • Increase sales of high-margin products (2023)
  • Increase sales of high-inch tires and dedicated EV tires (2023)
  • Maintain growth momentum in the Korean market (2023)
  • Strengthen leadership in the EV tire market by launching the EV performance tire iON evo (2023)
  • Expand T'Station with specialized EV charging facilities (2023)
  • Expand Dynapro XT and Ventus evo Z AS (2023)
  • Strengthen the foundation for stable and sustainable growth in China (2023)
  • Launch new high-tech premium products (China, 2023)
  • Expand OE tire fitments on premium car brands (China, 2023)
  • Target the rapidly growing Chinese EV market with the launch of iON (China, 2023)
  • Strengthen competitiveness through active distribution investments (China, 2023)
  • Pursue qualitative and quantitative growth in Europe (2023)
  • Develop and implement strategies and processes to respond to changing market conditions (Europe, 2023)
  • Strengthen SUV/pickup tire lineup by developing and launching new products (North America, 2023)
  • Expand presence in the RE tire market by investing in the Tennessee plant (North America, 2023)
  • Expand sales of high-value-added products (North America, 2023)
  • Create future growth businesses for sustained growth in Asia Pacific (2023)
  • Boost sales through differentiated sales, product, distribution, and marketing strategies (Asia Pacific, 2023)
  • Expand warehouse sales from the current African market to the entire Middle East region (Middle East and Africa, 2023)

Environmental Challenges

  • Rising raw material prices
  • Global logistics disruptions
  • Economic slowdown
  • Global inflation
  • Russia-Ukraine war
  • China's lockdown policy
  • Declining market growth across the industry (China, Europe)
  • Rapid increase in market inventory (North America)
  • Decline in market demand (North America)
Mitigation Strategies
  • Optimized sales strategies for each region
  • Expanding the proportion of high-value-added products
  • Raising sales prices
  • Improving sales prices, adjusting product sales mix, and reducing costs (ES Business Headquarters)
  • Developing new AGM battery technologies (ES Business Headquarters)
  • Strengthening profitability and achieving sustainable corporate development (ES Business Headquarters)
  • Expanding OE tire supplies to premium automakers (Hankook Tire)
  • Developing eco-friendly tires (Hankook Tire)
  • Maintaining supply flexibility and using locally sourced materials (North America)
  • Price increases (North America)
  • Strengthening distribution infrastructure by stabilizing existing offline channels and developing new channels (China)
  • Launching new high-tech premium products (China)
  • Increasing OE tire fitments on premium car brands (China)
  • Targeting the rapidly growing Chinese EV market (China)
  • Improving productivity and product competitiveness (Europe)
  • Executing a segmented distribution strategy (Europe)
  • Launching proactive marketing activities (Europe)
  • Building a premium brand image across Europe (Europe)
  • Developing and launching new products to expand stable sales (North America)
  • Leveraging new EV tire, iON (North America)
  • Collaborating with corporate clients (North America)
  • Investing in the expansion of the Tennessee plant (North America)
  • Restructuring product lineup to drive sales of SUVs and high-inch tires (Asia Pacific)
  • Stepping up EV product operations (Asia Pacific)
  • Strengthening the competitiveness as a maker Franchise (Asia Pacific)
  • Expanding warehouse sales (Middle East and Africa)
  • Opening a direct sales subsidiary in the United Arab Emirates (Middle East and Africa)

Supply Chain Management

Supplier Audits: Supplier ESG assessment process includes a carbon survey

Responsible Procurement
  • Developing Carbon Management Guide for Suppliers
  • Improving supply chain human rights management system

Climate-Related Risks & Opportunities

Opportunities
  • Development of energy-efficient products
  • Development of sustainable raw materials and products

Reporting Standards

Frameworks Used: Dow Jones Sustainability Index (DJSI) World, EcoVadis

Certifications: ISCC PLUS, Process Safety Management (PSM), ISO 45001 Safety and Health Management System

Sustainable Products & Innovation

  • Tires containing 45% and 55% sustainable raw materials
  • iON, an exclusive EV tire brand

Awards & Recognition

  • Happiness Award in Donation Category at 9th Annual CCK Grand Prize
  • Manufacturer of the Year 2021 by Auto Bild
  • Gold Class in S&P Global's 2022 Sustainability Annual Report