A majority of Korea’s top 100 companies by revenue aren’t prepared to meet international corporate responsibility standards, according to an industry study, reports The Korea Herald.
At the heart of the issue is the upcoming International Organization Standardization (ISO) 26000 standard, which will include requirements for the environment, fair trade, labor practices, human rights and management structure. The new standard is expected to go into effect by the end of the year.
The report, released by the Korea Chamber of Commerce and Industry (KCCI), indicates that by failing to meet the ISO 26000 standards, Korean companies could jeopardize their future export businesses, reports The Korea Herald.
As an example, Joong Ang Daily cites that a local exporter of manufactured goods lost a trading partnership with an importer when it reported that it had not developed strategies to meet ISO 26000 standards.
The Korea Chamber of Commerce and Industry said in the article that this lack of preparation among local companies could create a new type of trade barrier if they don’t prepare to adopt ISO 26000.
The U.S. State Department estimates that South Korea’s export trade business is valued at about $433 billion in 2008, including electronic products, automobiles, machinery and equipment, steel, ships, and petrochemicals.
The report reveals that only 4.9 percent of the top 100 Korean companies have the necessary tools to meet the ISO standards, while another 36.1 percent said they are “somewhat” equipped, reports The Korea Herald. About 36 percent said they have no tools, 21.3 percent said they are “practically unequipped,” and 1.6 percent expressed “no interest,” according to the article.
The Business Institute for Sustainable Development, which is affiliated with the KCCI, said in a statement that ISO 26000 will pertain to companies, government, civic groups, labor groups and research institutes, reports Joong Ang Daily.
According to The Asian Sustainability Rating conducted by CSR Asia, Korea does not make the top 10 list of nations that provide corporate responsibility disclosure on the environment, reports Eco-Business.com. According to the ranking, Japan leads in the region at 70.6 per cent, followed by Australia at 70.3 per cent, and India at 47.8 percent.