1. 0 GIN 2006 13 th International Conference State of the Arts on Sustainability Report: A Case of Korean Business Circles State of the Arts on Sustainability Report: A Case of Korean Business Circles 06 – 07- 03 Yoon-Gih Ahn * & Yoon-Jung Chin ** * POSRI, Senior Researcher & Erasmus University, Ph.D Candidate ** POSRI, Associate Researcher Ⅰ. Introduction Ⅱ. Theoretical Perspective and Applied Method Ⅲ. Case Study including findings and discussions Ⅳ. Conclusion

2. 1 GIN Conference, 2006 Corporate Sustainability Management as a New Paradigm for Business Circles 1 Introduction In line with growing importance of stakeholders in business circles, Communication as one of key tools for transparency 2 Therefore, the paper examine two folds; one is to identify state of the arts of sustainability report in Korean business circles, the other is to compare state of the art of sustainability report of three Korean companies and that of three global leading companies in the same industry. 3

3. 2 GIN Conference, 2006 Theoretical Perspectives  Stakeholder theory emphasizes the relationship and dialogue/ communication with groups with a stake in the firm, ultimately integrating them into managerial decision-making (Emshoff and Freeman, 1978).  Corporate accountability theory requires the integrity and transparency from firm’s stakeholder. Therefore, corporate sustainability report should be issued on the basis of the verification by internal or external body to enhance understanding or awareness of its stakeholders.

4. 3 GIN Conference, 2006 Applied Methods “ Tell Me ” “ Show Me ” “ Prove Me ” “ Discuss with Me ” “ Discuss with Me ” “ Involve Me ” (Stakeholder Perspective) (Sustainability Report Model Perspective) “ Impacts ” “ Internalization ” “ Inclusion ” Integration Incubation ① ④ ③ ②

5. 4 Applied Methods Source: Revised on the basis of www.dartmouth.edu

6. 5 GIN Conference, 2006 Applied Methods Corporate Activities from the point of Triple Bottom Lines views Plan Stakeholder Analysis Identification of Core Stakeholders of Companies Business PrinciplesReflection of Laws, Regulations, and Standards etc. of External and Internal Society Mgt. PhilosophyReflection of the concept of sustainability for continuous growth and its characteristics ObjectivesObjectives and Targets of Corporate Level MeasuresIndicators for diagnosing the progress of Objectives and Targets Do Awareness Activities for enhancing awareness of internal and external persons, e.g., PR, Training Departments OrganizationOrganization being in charge of Sustainability Issues ImplementationActivities by Value Chain (R&D, Purchase, Manufacture, Marketing Check Self-diagnosisWhether company itself diagnose or not, and temporally or regularly Third Party Verification Verification of Management Systems like ISO 9000, ISO 14001, OHSAS 18000, SA 8000 etc. and Environmental, Social, and Sustainability Report Results of Rating Institutes like SAM, FTSE, ISVA etc. Act Board of DirectorWhether the review or not, and temporally or regularly Management Review Whether the review or not, and temporally or regularly Consistency Linkage of PDCA loop

7. 6 GIN Conference, 2006 Case Study “ Tell Me ” “ Show Me ” “ Prove Me ” “ Discuss with Me ” “ Discuss with Me ” “ Involve Me ” (Stakeholder Perspective) (Sustainability Report Model Perspective) “ Impacts ” “ Internalization ” “ Inclusion ” Integration Incubation ① ② ③ ④ E4E4E4E4 D B F3F3F3F3 G2G2G2G2 A C2C2C2C2 * Note: The number means no. of firms.

8. 7 GIN Conference, 2006 Case Study Raw Material (iron ore, energy, etc.) Customer Oriented Industry (electronics/food & drinking) Manufactures (Automotive) Logistics Public Service Financial Service (Energy & Water Utilities/Real Estates) (Insurance/Bank)

9. 8 GIN Conference, 2006 Case Study  In Plan stage, the importance and the analysis of stakeholders were identified more clearly and accurately in the global leading companies than Korean companies.  In Do Stage, organizational charts of global companies for sustainability management were more comprehensive and systematic than those of Korean companies.  In the framework of strategic management perspectives, the structure of globally leading companies for sustainable management is more clearly and accurately developed than that of Korean companies.

10. 9 GIN Conference, 2006 Conclusions  Sustainability report of Korean companies is evolving stage from the infant stage. They also are not enough to discuss or involve with their stakeholders and sustainability report model does not reflect TBL factors sufficiently in their business management in strategic perspectives.  Particularly, the result compared three Korean leading companies with three global leading companies in the same industry in PDCA perspectives presents the gap. The structure of globally leading companies for sustainable management is more clearly and accurately developed than that of Korean companies.  Korean business circles should have a continuous interest in sustainability report as one of key tools for communicating with stakeholders. As well, accountability theory and strategic approach method are highly important when they publish their sustainability report. Applied methods will be helpful to examine and understand state of the arts of sustainability report in Korean business circles and to compare sustainability report of three Korean companies with that of global leading companies. Through the analysis, the paper confirmed in Korean business circles such as follows; Thank you for Your Attention !