The Broken Labor Practices In Samsung

 

                                                                        * BIRENDRA K JHA

"Social Risk" is an important part of the ESG. Many ESG Managers, have little expertise over the "Social Risk", which definitely covers the Human Resource best practice and compliance of Human Right with Labor Law.   

ESG, is not alone the mission to "reduce the environment risk". Expert says violation of good HR and labor law practices are generating more carbon emission. When European Commission has tightened the nose of the strong ESG practices, then in this situation, company reporting poor ESG, shall be allowed to enter the European market ? Never, the European Commission shall blacklist such companies to operate in their European  territory.   In this condition,  shall Samsung also be able to gain entry in the European Market? This is mind blowing.  Samsung is suspected of having breached ESG good practices. It has poor history in controlling "Social Risk".  This company has broken the fundamental Labor Law practices, which is  required to remain  in business. This violation on record is seen   in China, Korea and Vietnam. The case in India has not yet been examined. 

When South Korean court, sentences Samsung chairman Lee Sang-Hoon to 18 months in jail for sabotaging the Trade Union activities, then it gives perfect litmus test of the prevailing ESG practices in Samsung. The bright building of Samsung has ugly face. Lee with  25 officers have been convicted of violating labor law and Trade Union-related laws. They had been using several tactics to target the "Trade Union" activities, including closing supply vendor companies, where Trade Union exists. Other tactics used by the company, that has been proved is to target Trade Unions which included finding out sensitive information about union members to convince them to leave job, and delaying negotiations between labor unions and management.

If Samsung at one side is doing excellent job in reducing the "Environment Risk", then why it failed to control the "Social Risk",  which violated aggressively the Labor Laws & Labor Right. The answer is poor ESG Assurance and Audit monitoring in the Samsung.  This poor balance is sufficient to break down the entire ESG Framework. World Bank like institution shall never finance Samsung. 

If scenario persists, this company can't do business in the ESG controlled domain of the European Commission. Any Green ESG Mutual Fund, can't be invested in Samsung. If Mutual Fund operators, like State Bank of India or other Financial institutions have invested in Samsung any funding from the ESG Mutual fund, then clearly the banks have violated SEBI Law and Reserve Bank of India guidelines. Look down also some more  check lines:  

a)  Research Organization "Supporters for the Health and Rights of Workers in the Semiconductor Industry", South Korea and "Research Centre for Gender, Family and Environment in Development, Vietnam" have reported negative observation in Samsung. The ESG, second pillar is almost paralyzed. Serious violations of fundamental labor rights are seen in this company, which particularly affect women,  abusive working hours, working condition and poor housing conditions that are incompatible with human dignity, employment of children under the age of 16, and endangerment of workers have been noticed. Supporters for "The Health and Rights of Workers in the Semiconductor Industry (SHARPS) in Seoul, indicates that the company still refuses to disclose health and safety information, which is  essential for the protection of its own workforce.

b) The "Research Centre for Gender, Family and Environment in Development" at  Vietnam, discloses that use of toxic chemicals without adequate protection in Korean factories, including benzene and methanol, has caused incurable diseases. At least 465 workers are suspected of being affected, 135 of whom are already dead. This data is mind blowing. This paints a very bad image of Samsung on the ESG Environment Pillar. If so, then  Samsung products can't enter the European market with such poor ESG Practices.  

c) Samsung Electronics' chairman, Lee Sang-Hoon has been sentenced to 18 months in jail for sabotaging Trade Union activities. Lee is among 26 Samsung executives that were convicted by the Seoul Central District Court for violating labor union laws. Seven received jail terms while others received suspended sentences. Since the group's founding in 1938, the Samsung has practiced  "No Trade Union Rule". If culture is still existing then it breaks the very foundation of the ESG's, Social Pillar.  

Though, the company has invested on the Environment Pillar to reduce the carbon emission. Plan has  to achieve the "zero carbon emissions" with plans to use more renewable energy. Investment is done in researching new technologies to develop energy-efficient products and reduce carbon emission. The company is also researching into "water reuse" and "develop carbon capturing technology". This has plan to achieve  Net zero carbon emissions in (Scope 1 & Scope 2)  by 2030 and across all global operations by 2050. For reducing carbon emission, the company has made significant changes:

a) significantly reduce process gases — a byproduct of semiconductor manufacturing

b) install treatment facilities on its semiconductor manufacturing lines by 2030.

c) Use waste heat utilization scope and  introducing electric heat sources to reduce LNG boiler usage.

d) The company has plan to source energy from renewable energy  and participating in green pricing programs.

Conclusion: 

Samsung ESG case can be compared with that front car tires, where one tire is of tractor and another tire of scooter. This poor ESG balance is between "Environment Risk Pillar" and "Social Risk Pillar". This is sufficient to break down the entire ESG framework. World Bank like institution shall never finance Samsung, if scenario persists. What India shall learn from this poor practice ?  Shall Indian companies be allowed to operate in India with no monitoring control over the ESG ? 


( Birendra K Jha,  is a Pan India Practitioner on the "Social Impact Assessment Audit"; "ESG Audit" & "Sustainable Practices".  He is a Qualified & Certified  Social Auditor from the Institute of Social Auditor of India (ISAI -ICAI). He is also certified professional on the:  ESG; Environment Accounting; Environment Law; Carbon Emission Accounting;  Carbon Tax ; Sustainable Practices; and Social Risk covering Human Resource & Labor Law. He is based at Delhi-NCR. He overlooked at senior position as General Manager and Deputy General Manager in the previous South Korean MNC Company in India handling human resource, social audit,  ESG and sustainable  practices for more than a decade. He may be approached at: birendrajha03@yahoo.com )


#CSRHead  #HeadGroupCSR #CompanySecretary  #MD #ManagingDirector #CSR #SocialImpactAssessment #SocialImpact  #SocialAudit #SocialStockExchange #corporatesocialresponsibility #talentacquisition #VicePresident #Director #NayaraEnergyLimited 

#nayaraenergy #csrimpactassessment #sustainabilityreporting 

#DrAloisVirag #AloisVirag #CRISIL #ESG #Sustainability #climatechange 

#AmishMehta #GrantThorntonBharat #MakeADifference #TarunBaijnath #NishantSingh

#SEBI #pwc #PricewaterhouseCoopers #RECLtd #Adani #GautamAdani #Axisbank #Axis


Comments

Post a Comment

Popular posts from this blog

Evidence Based Impact Assessment Audit of Safeguard Policy Violation by ADB Bank Financed MSEDCL Project at Maharashtra - Issues of non-compliance on Indigenous People & social environmental safeguard violation.

Image
Tribal belts of Maharashtra are using from very ancient times "Water Pit" and small accumulated pond. This is surface water. This surface water is disturbed or quality of water on the surface is spoiled if  groundwaters are extracted without mind. The Water Pits are lifeline for the tribal population. The tribal people (Indigenous People) are more at risk in Vidarbh and other region of Maharashtra. They are completely dependent on such "Water Pits". The ADB Bank project at Maharashtra, giving free license to the electrical water pump owners to remove as much as underground water, they  desired,  shall disturb the water level chart with severe threat on the environmental and social issues. This risk threat is completely missing from the three safeguard monitoring audit conducted by the MSEDCL and submitted to the ADB Bank in the project of "Maharashtra Rural High Voltage Distribution System Expansion Program". The consultation process with the "Indigen
Read more

CRISIL "Leadership Rating" In ESG - Lessons From Axis Bank

Image
  I have demonstrated earlier,  the ESG rating, by agency like  CRISIL needs, more  good practice of inducting the third party "Social Audit" before publishing the ESG rating, when there is past history of ESG practice violation.   Any poor or exaggerated ESG rating shall alter the share market price. Now a days this is the perception of the investors that strong ESG compliance of company, is  good indicator of safe investment and excellent return. This is also the target of the Government of India to achieve the Sustainable Development Goal ( SDG Goal ). This SDG Goal mandate, mostly is achieved through  the regulatory authority SEBI.  The SEBI has mandatorily implemented the ESG evaluation of various companies. This rating evaluation now is not matured. The rating agency like the  CRISIL so far has been rating the ESG parameter of the various companies.    CRISIL mostly captures ESG compliance through the document disclosures by company in the public domain. This has been e
Read more

Safeguard Compliance Failure In ADB Bank & World Bank Funded Tata Power Project At Mundra, India - A Violation Towards Ocean Submerged Ancient Cultural Heritage Town Of Bhagwan Krishna.

Image
  Image One: The Sentinal -2 Satellite, took the photograph of the Gulf of Kutch scenario.  The Ancient Ocean submerged Dwarka Town of Bhagwan Krishna is shown here  in 3 yellow broken line circles. These three sites remain submerged under Ocean water. Just top of it in red circle broken line is the Tata Power Project, funded by the ADB Bank & the World Bank. The project,   facility station of water discharge and pumping station are both here. The red arrow  mark in the Ocean is showing the patch of "Dead Phytoplankton" and the green arrow is showing the volume of the  "Healthy Phytoplankton". The "Dead Phytoplankton" originates from the Tata Power  and moves down to the  ancient Submerged Dwarka City of Bhagwan Krishna. The first yellow circle edge line is almost covered by the "Dead Phytoplankton." There is also second cluster group of  "Dead Phytoplankton" at the extreme right side. This is coming from other source, which needs f
Read more