*Semiconductor Environmental Performance Index
The Semiconductor is a key contributor to Korea’s economic growth, and here at Samsung Semiconductor, we continue to make strides in reducing our carbon footprint throughout the value chain.
With semiconductors being used in more and more places, their environmental impact on industries around the world continues to grow. As a result, while there is mounting pressure on semiconductor companies to implement sustainable environmental practices, a lack of specific environmental management guidelines is creating confusion among many semiconductor companies.
It can be confusing for semiconductor companies to adhere to evaluation standards, because domestic and foreign evaluation agencies related to ESG (Environment, Social, Governance) have different evaluation indexes and ratings. Experts cite ESG's short history and its evaluation structure without an academic foundation as a reason why ESG evaluation indexes vary from institution to institution.
Samsung Semiconductor has developed its own Semiconductor Environmental Performance Index (SEPI) to provide environmental management guidelines that take into account the specificity of the industry and help initiate these practices throughout the semiconductor industry.
SEPI was developed in cooperation with KPMG, a global network of professional firms providing audit, tax and advisory services. We use our SEPI results to communicate our environmental efforts to all interested parties, from semiconductor experts, environmental certification organizations, media outlets to our customers. As an industry leader, the SEPI helps Samsung Semiconductor to share environmental management knowledge and experience, and spread it throughout the semiconductor industry.
Let’s find out more about how SEPI works and how environmental practices are assessed.
To secure SEPI's credibility, Samsung Electronics established the SEPI Review Committee. Composed of five experts from the academic, semiconductor industry and certification fields, the Committee checks the suitability of details and logic of SEPI, an environmental management performance indicator, while taking the characteristics of the semiconductor industry into account.
At a time when the semiconductor’s industry needs to change its overall perception of environmental management efforts and needs, the review committee expects that SEPI will go beyond mere indicators and become a new beginning for the semiconductor industry. This is because SEPI enables a fierce and systematic internal evaluation of a company, and through SEPI, companies can accurately and efficiently communicate with stakeholders such as the government and consumers. To discuss the role and meaning of SEPI in more detail, we’ve spoken with industry experts: Seung-jick Yoo, Professor of Environmental and Climate Change Studies at Sookmyung Women's University, Byung-ok Ahn, Professor of Convergence Engineering, Hoseo University, Eric Jeon, UL Korea’s Environment & Sustainability Manager, Ki-hyun Ahn, Vice President of the Korea Semiconductor Industry Association and Jung-nam Kim, Partner at Samjong KPMG, ESG & Strategy.
"SEPI can provide directiobnfor environmental management and play a key role in responding to external risks such as regulations and reputation."Byung-ok Ahn, Professor of
“At a time when Korea imposes strong sanctions on climate change and carbon neutrality,Seung-jick Yoo, Professor of Environmental and Climate Change Studies at
SEPI allows semiconductor companies to systematically manage their efforts and benefit from improvements.”
“One of the driving forces behind the rapid growth of the domestic semiconductor industry is excellent institutions and system benchmarking. SEPI is a good indicator that many companies vulnerable to environmental management can use to lower the risk of their business activities.”Ki-hyun Ahn, Vice President of
“SEPI is a milestone in environmental management that goes one step further. I hope that it will develop into an objective and comprehensive indicator that matches the characteristics of the semiconductor industry.”Eric Jeon, UL Korea’s
“In today’s environment where businesses are evaluated by a range of different organizations around the world, it is encouraging to see a company take the initiative and develop an environmental management performance indicator. Samsung’s SEPI serves as a good benchmark for companies within and outside the industry.”Jung-nam Kim, Partner at Samjong KPMG,
At Samsung Semiconductor, we are proud of being able to communicate our green efforts with our partners. We expect not only internal departments at Samsung Electronics but also the semiconductor industry as a whole will adopt SEPI as a way to expand environment management and achieve eco-friendly growth.
There are five principles that guide SEPI. First, to evaluate the eco-friendly performance in all areas related to environmental management, from the management system to each stage of the value chain. Second, to extensively assess the main environmental factors, including carbon emissions, industrial water, waste and chemicals. Third, to evaluate the semiconductor industry’s contribution to cleantech, such as the progress made in developing low-power, high-performance semiconductors. The fourth principle is to reflect semiconductor characteristics, dealing with technology levels and PFC emissions. The fifth and final principle is to use publicly disclosed annual reports and data based on a rigorous analysis and evaluation of disclosed data such as sustainability reports and business reports.
User environment
benefits (5%)
⑥ Product eco-friendly
level (5%)
Environmentally friendly
product certificate
Low-power, high-performance semiconductor
emissions reduction level
There are five principles that guide SEPI. First, to evaluate the eco-friendly performance in all areas related to environmental management, from the management system to each stage of the value chain. Second, to extensively assess the main environmental factors, including carbon emissions, industrial water, waste and chemicals. Third, to evaluate the semiconductor industry’s contribution to cleantech, such as the progress made in developing low-power, high-performance semiconductors. The fourth principle is to reflect semiconductor characteristics, dealing with technology levels and PFC emissions. The fifth and final principle is to use publicly disclosed annual reports and data based on a rigorous analysis and evaluation of disclosed data such as sustainability reports and business reports.
Four areas are assessed: semiconductor’s contribution to green efforts, environmental management in the supply chain, on-site environment-friendly achievements and user environment benefits. For detailed analysis, the four areas are further divided into six categories and 32 indicators. The weighted scores are based on different values assigned to each area and each value is measured by percentage points. The user environment benefits area is used as an additional indicator and only assigned to companies that have offered information on the environmental impact of the end product. Samsung Electronics intends to strengthen its environment-friendly activities by setting standards for eco-friendly effects enabled by the use of Samsung semiconductor products and publicly disclosing its actual achievements.
| Quantitative indicators (21) |
Qualitative indicators (11) |
|
|---|---|---|
|
Evaluation |
Relative |
Absolute |
|
Evaluation |
Grades for each indicator are derived from max/min. values and set range. Grades are based on research results. |
Each indicator has 5 grades / Grades are given based on industry best practices |
|
Evaluation |
Results are assigned to 5 grades where each grade accounts for 20% |
Monitoring instead of presentation of information. Focus on evaluating progress achieved based on feedback. |
|
Peer |
Total |
Percentage |
Points |
|---|---|---|---|
Company A |
300 |
15% |
5 points |
Company B |
350 |
18% |
|
Company C |
500 |
500 |
4 points |
Company D |
550 |
28% |
|
Company E |
900 |
45% |
3 points |
Company F |
1,100 |
55% |
|
Company G |
1,300 |
65% |
2 points |
Company H |
1,500 |
75% |
|
Company I |
1,850 |
93% |
1 point |
Company J |
2,000 |
100% |
Standard |
Points |
A |
Company B |
C |
|---|---|---|---|---|
|
Mid- to long-term + mid-term goals |
5 points |
O |
- |
- |
|
Mid- to long-term + mid-term goals |
4 points |
- |
O |
- |
|
Mid- to long-term goals only |
3 points |
- |
- |
- |
|
Mid- to long-term goals only |
2 points |
- |
- |
O |
Goal presentation only |
1 points |
- |
- |
- |
*Paris Agreement greenhouse gas objectives: Restricting Earth's average temperature rise below 2°C and limiting it to within 1.5°C,
compared to
pre-industrial levels.
The 32 indicators are divided into quantitative and qualitative factors, with each indicator given a maximum of
5 points.
US
