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Since its establishment in 1974, LSIS has grown into the No. 1 power and automation solutions company in Korea based on quality and innovation, leading Korea’s industrial development. LSIS believes that people are the driving force for a successful business, and seeks to enable its employees to grow into key people for sustainable growth Tweet This!, also strengthening communication between the management and employees to share the importance and direction of organisational change.
This case study is based on the 2018- 2019 Sustainability Report by LSIS published on the Global Reporting Initiative Sustainability Disclosure Database 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.
Abstract
Improving its employees’ capabilities and enhancing their competitiveness through, among others, well-organised training programmes, has always been a key priority for LSIS. In order to encourage employee development LSIS took action to:
- implement training programmes
- promote fair evaluation and compensation
- respect human rights and guarantee basic labour rights
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With this case study you will see:
- Which are the most important impacts (material issues) LSIS has identified;
- How LSIS proceeded with stakeholder engagement, and
- What actions were taken by LSIS to encourage employee development
What are the material issues the company has identified?
In its 2018- 2019 Sustainability Report LSIS identified a range of material issues, such as technological competitiveness, compliance management, eco-friendly products and services, worksite safety management, energy conservation and climate change. Among these, encouraging employee development stands out as a key material issue for LSIS.
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 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 LSIS engages with:
| Stakeholder Group | Method of engagement |
| Local communities
|
· Meetings with local communities
· Direct communication with the person in charge · Meetings with the management · Surveys |
| Organisations
|
· Regular meetings
· Company website · Direct communication with the person in charge |
| Shareholders and investors
|
· NDR
· Company visits · Company website |
| Employees
|
· Communicator
· LinkerS · LSIS Monthly Magazine · Surveys · WeLS |
| Suppliers
|
· ACE Club
· Meetings for shared growth and innovation · Performance sharing meetings · Management seminars · TOPS (internet portal for shared growth) · ACE innovation networking |
| Customers
|
· Exhibitions and seminars
· Meetings with customers · Distributors meetings · Visit to customers · Customer service centres |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics LSIS carried out a stakeholder survey with 868 participants, including customers, employees, suppliers, environmental organisations, shareholders and investors.
What actions were taken by LSIS to encourage employee development?
In its 2018- 2019 Sustainability Report LSIS reports that it took the following actions for encouraging employee development:
- Implementing training programmes
- LSIS has been providing superb facilities and well-organised training programmes to enhance employees’ competitiveness. The training programmes are divided into position-specific programmes, global programmes, organisational development programmes and job-specific programmes to support the development of employees’ capabilities. LSIS also installed a global lounge at headquarters and Cheongju plant, so that employees could improve their language skills and their capacity to adjust to other cultures.
- Promoting fair evaluation and compensation
- LSIS believes that fair evaluation and compensation are the foundations of sustainable development and, in its performance evaluation system, targets are set at the group, division, team and employee level in order to achieve LSIS’s management goals. Teams’ ratings based on the evaluation results are linked to individual ratings, and the results are used for determining bonuses, salaries, promotions, and career development.
- Respecting human rights and guaranteeing basic labour rights
- LSIS maintains a system to prevent all forms of discrimination with regard to gender, race, religion, or place of origin. To this end, policies to promote diversity are being implemented, to foster an environment in which employees are given equal opportunities to reach their full potential. LSIS strictly abides by all related domestic and international laws. There has never been a case of violation related to these issues, and LSIS remains committed to improving this system of respecting human rights. In addition, annual negotiations over wage and collective agreements are carried out between the management and labour representatives, in order to improve working conditions. Freedom of association is guaranteed, such that employees are never disadvantaged for their labour union activities and, as of the end of 2018, according to the collective agreements and labour rules, 100% of production workers had joined the labour union, and 32.4% of LSIS employees were union members.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 404-2 Programs for upgrading employee skills and transition assistance programs
Disclosure 404-2 Programs for upgrading employee skills and transition assistance programs corresponds to:
- Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
- Business theme: Employee training and education
Disclosure 404-3 Percentage of employees receiving regular performance and career development reviews corresponds to:
- Sustainable Development Goal (SDG) 5: Achieve gender equality and empower all women and girls
- Business theme: Gender equality
- Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
- Business theme: Employee training and education
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References:
1) This case study is based on published information by LSIS, 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 original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:
http://database.globalreporting.org/
2) https://www.globalreporting.org/standards/gri-standards-download-center/
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