SK Bioscience said it had demonstrated global-level performance in ESG (environmental, social, and corporate governance) management, but the company’s rating in the MSCI ESG rating remained at an average level, it was learned.
In a news release Friday, SK Bioscience said it won a BBB rating in the ESG evaluation conducted by Morgan Stanley Capital International. MSCI rates globally listed companies on 35 key ESG issues in 10 categories every year.
SK Bioscience said it won a B rating in its first evaluation in 2021 but jumped two notches in a year, demonstrating sustainable management at a global level.
“Advancing ESG management is now a must for all global standard companies,” SK Bioscience CEO Ahn Jae-yong said in the news release.
“Focusing on our core mission of promoting global public health and pursuingthe happiness of stakeholders, and upgrading the business management environment, we will establish ourselves as a truly global leading company.”
According to confirmation by Korea Biomedical Review, however, SK Bioscience’s rating was not exactly that of global leaders. MSCI makes public target companies’ ESG ratings, trends, and levels compared to other companies within the same industries on its website.
MSCI divides ESG evaluation results into seven grades – CCC, B, BB, BBB, A, AA, and AAA – and categorizes CCC and B as laggards, BB, BBB, and A as average, and AA and AAA as the leader.
According to the MSCI classification, the BBB rating received by SK Bioscience corresponds to the "average" class. In fact, MSCI clarified that SK Bioscience is the "average" level among 38 biotechnology companies.
Therefore, it is equivalent to the top 63 percent.
SK Bioscience was classified as a laggard in the first ESG rating in 2021 but got out of the group last year.
SK Bioscience was also rated as insufficient in providing medical service providers to developing and middle-income countries, an area the company used to emphasize.
According to the rating report, the company received zero evaluations concerning its efforts to expand its medical products and services to developing countries and other alienated markets through the fair pricing mechanism, patents, advanced capabilities, and product donations.
“SK Bioscience is not a leader on any of the key issues that we evaluated for its industry,” it said.
Besides, SK Bioscience said it had obtained A or higher grades in all areas in the “2022 listed companies’ ESG evaluation and grade announcement” by the Korea Institute of Corporate Governance and Sustainability (KCGS) in November. However, global investment companies use MSCI’s ESG rating as a significant investment guide.
“You need to consider our company has been listed only recently. Nevertheless, we received high grades in all areas that evaluated current status regardless of business history,” an SK Bioscience official said. “Ours may not be that high compared with companies with a long history, but we are improving gradually.”