Case study: How Hyundai creates economic value for its stakeholders
Committed to innovation for people and the planet, Hyundai Motor Company has been providing its customers with the best products and services possible ever since its establishment in 1967. Securing a competitive edge that creates sustainable economic value for all its stakeholders, is a top priority for Hyundai. Tweet This!
This case study is based on the 2022 Sustainability Report by Hyundai, prepared in accordance with the GRI Standards, that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Hyundai is continuously making sincere efforts to pursue the creation of economic value for its stakeholders by realising customer value through quality management, and creating social value through corporate citizenship. In order to create economic value for its stakeholders Hyundai took action to:
- create economic value for employees
- create economic value for shareholders and investors
- create economic value for suppliers
- create economic value for the government
- create economic value for local communities
Subscribe for free and read the rest of this case study
Please subscribe to the SustainCase Newsletter to keep up to date with the latest sustainability news and gain access to over 2000 case studies. These case studies demonstrate how companies are dealing responsibly with their most important impacts, building trust with their stakeholders (Identify > Measure > Manage > Change).
With this case study you will see:
- Which are the most important impacts (material issues) Hyundai has identified;
- How Hyundai proceeded with stakeholder engagement, and
- What actions were taken by Hyundai to create economic value for its stakeholders
Already Subscribed? Type your email below and click submit
What are the material issues the company has identified?
In its 2022 Sustainability Report Hyundai identified a range of material issues, such as carbon neutrality & expansion of renewable energy, technological innovation, supply chain ESG risk management, strengthening product safety and quality management. Among these, creating economic value for its stakeholders stands out as a key material issue for Hyundai.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process s of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups Hyundai engages with:
| Stakeholder Group | Method of engagement |
| Customers and Dealers
| · Motor show and new car launching ceremony · Test driving · Before Service · Customer satisfaction survey · Car club · On-line (social media) · Website · Sports sponsorship · Dealer event |
| Employees
| · Labour-Management Council · Employee satisfaction surveys · Meetings and events · Grievance handling system · Occupational Safety and Health Committee · Work-related education and training |
| Suppliers
| · Win-win growth portal site · HMG Partner System · Transparent Purchase Practice Centre website · Global Win-Win Cooperation Centre (GPC Portal) · Seminars and training |
| Local Communities
| · Social contribution programmes · Communication with local communities nearby the company’s business sites · Recruitment · Family inviting events |
| Government
| · Public hearings · Policy-making discussions and briefings |
| Shareholders and Investors
| · Annual Shareholders Meeting · Company briefing · IR meetings · Sustainability Management Committee · Website |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics Hyundai engaged with its stakeholders through a double-materiality-based stakeholder survey.
What actions were taken by Hyundai to create economic value for its stakeholders?
In its 2022 Sustainability Report Hyundai reports that it took the following actions for creating economic value for its stakeholders:
- Creating economic value for employees
- In 2021, Hyundai paid KRW 639.2 billion for employee salaries.
- Creating economic value for shareholders and investors
- In 2021, Hyundai paid KRW 130.1 billion in dividends and KRW 8.7 billion in interest expenses.
- Creating economic value for suppliers
- In 2021, Hyundai paid KRW 3,701.1 billion in raw material costs.
- Creating economic value for the government
- In 2021, Hyundai paid KRW 34.4 billion in income tax.
- Creating economic value for local communities
- In 2021, Hyundai spent KRW 3.8 billion in donations.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standard addressed in this case is: Disclosure 201-1 Direct economic value generated and distributed
Disclosure 201-1 Direct economic value generated and distributed corresponds to:
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.1, 8.2
- Sustainable Development Goal (SDG) 9: Industry, Innovation and Infrastructure
- Targets: 9.1, 9.4, 9.5
78% of the world’s 250 largest companies report in accordance with the GRI Standards
SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.
Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.
7 GRI sustainability disclosures get you started
Any size business can start taking sustainability action
GRI, IEMA, CPD Certified Sustainability courses (2-5 days): Live Online or Classroom (venue: London School of Economics)
- Exclusive FBRH template to begin reporting from day one
- Identify your most important impacts on the Environment, Economy and People
- Formulate in group exercises your plan for action. Begin taking solid, focused, all-round sustainability action ASAP.
- Benchmarking methodology to set you on a path of continuous improvement
See upcoming training dates.
References:
This case study is based on published information by Hyundai, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:
Note to Hyundai: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.