1 of 27

Samsung: Leading Tech Company Stuck In The Past

Sustainability Issues, Labor Practices, Current Events & Recommendations

2 of 27

Objective: Provide insight into Samsung’s adherence to noted aspects of sustainability

3 of 27

What are they doing right?

https://d28wu8o6itv89t.cloudfront.net/images/techmfjpg-1538354834041.jpeg

file:///Users/adiguj/Downloads/ClickClean2016%20HiRes%20(1).pdf

energy footprint of the IT sector is already estimated to consume approximately 7% of global electricity. With an anticipated threefold increase in global internet traffic by 2020, 2 the internet’s energy footprint is expected to rise further, fueled both by our individual consumption of data and by the spread of the digital age to more of the world’s population, from 3 billion to over 4 billion globally
Major internet companies’ leadership has been a catalyst in driving a broader set of corporations to adopt 100% renewable goals, contributing to a dramatic increase in renewable deals in the U.S. signed directly by corporations, totally 3.4GW of renewable deals signed in 2015, with over two-thirds of this power from renewable deals by IT companies.
Lack of transparency regarding their energy demand and the supply of electricity powering their data centers remains a significant threat to the sector’s long-term sustainability.

https://www.huckmag.com/art-and-culture/tech/the-tech-industry-has-a-serious-sustainability-problem/

“I often wonder if people would be so quick to buy a new laptop if it was their brother or mother mining down a 100m pit, without any safety equipment working under permanent risk of mine collapse. Or if their father had been beaten by security forces at a mine site so badly that he is now paralysed. Or if they had been thrown off their land by the big mining company and their entire life turned upside down as a consequence.”

Raw materials for personal electronics come from disparate locations around the world: palladium mostly comes from South Africa and Norilsk, Russia, while silver comes from mines across all continents. Meanwhile, the manufacturing of parts happens in Korea, Taiwan, China, Thailand, Malaysia and Japan, before devices are assembled in countries like Brazil and India, as well as China and Korea themselves. The vastness of these supply chains means that transparency – and accountability – are easy to dodge. The physical production of tech products is also energy-intensive, as the global travel required in tech supply chains is a significant contributor to the planet’s greenhouse gas emissions.

4 of 27

Positive Environmental Contributions

Sustainability Accolades/Practices

Honored with SMM
Upcycling program
“Eco-Generation” tm
Reuse of waste material

10,000 tons

Supply chain sustainability

5 of 27

What Is Eco-generation?

6 of 27

Industry Evaluation:

https://d28wu8o6itv89t.cloudfront.net/images/techmfjpg-1538354834041.jpeg

https://www.flaticon.com/premium-icon/check-list_3475074

file:///Users/adiguj/Downloads/ClickClean2016%20HiRes%20(1).pdf

energy footprint of the IT sector is already estimated to consume approximately 7% of global electricity. With an anticipated threefold increase in global internet traffic by 2020, 2 the internet’s energy footprint is expected to rise further, fueled both by our individual consumption of data and by the spread of the digital age to more of the world’s population, from 3 billion to over 4 billion globally
Major internet companies’ leadership has been a catalyst in driving a broader set of corporations to adopt 100% renewable goals, contributing to a dramatic increase in renewable deals in the U.S. signed directly by corporations, totally 3.4GW of renewable deals signed in 2015, with over two-thirds of this power from renewable deals by IT companies.
Lack of transparency regarding their energy demand and the supply of electricity powering their data centers remains a significant threat to the sector’s long-term sustainability.

https://www.huckmag.com/art-and-culture/tech/the-tech-industry-has-a-serious-sustainability-problem/

“I often wonder if people would be so quick to buy a new laptop if it was their brother or mother mining down a 100m pit, without any safety equipment working under permanent risk of mine collapse. Or if their father had been beaten by security forces at a mine site so badly that he is now paralysed. Or if they had been thrown off their land by the big mining company and their entire life turned upside down as a consequence.”

Raw materials for personal electronics come from disparate locations around the world: palladium mostly comes from South Africa and Norilsk, Russia, while silver comes from mines across all continents. Meanwhile, the manufacturing of parts happens in Korea, Taiwan, China, Thailand, Malaysia and Japan, before devices are assembled in countries like Brazil and India, as well as China and Korea themselves. The vastness of these supply chains means that transparency – and accountability – are easy to dodge. The physical production of tech products is also energy-intensive, as the global travel required in tech supply chains is a significant contributor to the planet’s greenhouse gas emissions.

7 of 27

7% of global electricity - expected to rise
Lack of transparency regarding energy demand + supply of energy
New renewable deals signed in 2015 to adopt 100% renewable goals

C-

The Technology Sector vs. Sustainability

8 of 27

SWOT Analysis: Strengths

Industry:

Research & Development
Global Market
Strong Manufacturing Capabilities

Sustainability:

Incorporated biodegradable and recycled materials
Increasing energy efficiency of phones

&

https://theeagleonline.com.ng/samsung-extends-olympics-sponsorship-to-2028-ioc/

https://bstrategyhub.com/swot-analysis-of-samsung-2019-samsung-swot-analysis/

The foundation of Samsung has always been on Innovative research and development. Expenditure in these departments resulted in the company having a wide range of product portfolio among its competitors. These include tablet, camcorder, mobile phone, camera, TV/video/audio, Memory Cards, PC, and other accessories. They have 34 R&D (research and development) centers operating worldwide.
Dominates the Smartphone Market – Samsung has dominated the smartphone market for years. According to Gartner, in Q1 of 2020, Samsung has maintained the No. 1 spot globally with a 18.5% market share, where as Apple is at 13.7% market share.

Samsung retains a stronghold in the Asian markets, particularly India and China. Both India’s and China’s business markets are growing substantially which is why Samsung has taken advantage of the opportunity and incentivize in these countries accordingly.

https://www.compareandrecycle.co.uk/blog/samsungs-sustainability-report-2019-are-they-environmentally-friendly-now

9 of 27

SWOT Analysis: Weaknesses

Industry:

Heavily dependent on American Markets
Product Failures
Leadership

Sustainability:

Lack of transparency about Supply Chain
Planned Obsolescence

10 of 27

SWOT Analysis: Opportunities

Advertise to new target markets that Apple does not have stronghold on

03

Improve packaging

Introduce innovative products

02

Be a leader in change

Diversify investments and marketplaces

01

Increase transparency

INDUSTRY

SUSTAINABILITY

11 of 27

SWOT Analysis: Threats

Industry :

Increased competition

Apple, Huawei

Legal and Regulatory Threats
Changing Consumer Loyalty

Apple

Sustainability :

Increased Costs
Less corporate efficiency

12 of 27

Scary picture

13 of 27

The Truth Behind Samsung

Company Grievances….

14 of 27

Company Practices

Recent Controversies:

Bribery
Anti-Union
Legal Challenges
Succession in Leadership

15 of 27

Affordable Clean Energy

2020 Sustainability Report

Committed to using 100% renewables
Reduce greenhouse emissions

However...

16 of 27

CLIMATE ACTION

Flagship phones are difficult, expensive to repair
Integrated batteries are often the part that fails first
“People ditch a perfectly-functional phone because of a single failing component.”

https://www.engadget.com/2018-02-06-ethical-smartphone-conscious-consumption.html

https://medium.com/@heidi_bischof/why-your-smart-phone-is-killing-the-planet-and-how-to-make-it-stop-9eb282c23fac

https://www.ifixit.com/smartphone-repairability

For example, Samsung’s phones are notoriously hard to repair. When looking at the website iFixit, which publishes a chart of smartphones ranked by their repairability, Samsung phones have consistently ranked very low on their scale. Their most recent phone, the Samsung Galaxy Note 20 Ultra, scored only a 3/10. Batteries are also now glued and integrated into their phones. Integrated batteries are often the part that fails first, which leads consumers more likely to replace the entire phone. This then leads to more e-waste. Currently, only 15% of e-waste is actually recycled properly.

17 of 27

Health and Wellbeing

>200 cases of factory employees contracting serious illnesses
Linked to 76 deaths
Asked the South Korean government to not disclose substances
Instances of child labor

https://www.engadget.com/2018-02-06-ethical-smartphone-conscious-consumption.html

https://apnews.com/article/ea1b8280b50b4ad3a9bdcd9def798914

https://www.gannett-cdn.com/-mm-/e76b4981cb25c123b7f50e44b5ea1e1df0f114f1/c=0-49-1998-1178/local/-/media/2018/03/05/USATODAY/USATODAY/636558689867820398-AP-SOUTH-KOREA-SAMSUNG-30704619.JPG?width=660&height=373&fit=crop&format=pjpg&auto=webp

The worker safety group SHARPS has documented over 200 cases of serious illnesses including lymphoma, leukemia, lupus, and multiple sclerosis among former Samsung semiconductor and LCD workers in South Korea. Among them, 76 have died, mostly in their 20’s and 30’s. At the request of Samsung, officials have refused to hand over important information about the chemicals the workers were exposed to. The families of these victims not only have to live with unknowns regarding their loved one’s illness or death, but they often have to spend their life savings and sell their homes to pay for the hospital bills. Additionally, Samsung has been caught using child labor in their factories. The China Labor Watch, a nonprofit that examines working conditions, found children as young as 14 working for a supplier in 2012.

18 of 27

Health and Wellbeing/Gender Equality

Half of all Samsung phones are manufactured in Vietnam by a female-majority workforce in their twenties.
USA Today Interview with 45 female assembly line workers

Episodes of dizziness, fainting
Illegal noise levels
Body pains
No work contracts
Miscarriages

https://www.usatoday.com/story/opinion/2018/03/14/your-cool-new-samsung-smartphone-brought-you-noise-pain-miscarriages-pham-digangi-column/397173002/

https://as1.ftcdn.net/jpg/01/51/32/20/500_F_151322051_C1JtjR72EnZF8tQUkTbfiGtWF886vAax.jpg

The Health and Wellbeing of female Samsung factory employees has also been an issue for the company. According to a USA Today article where 45 female assembly line workers were interviewed, every one of them reported instances of dizziness or fainting at work. There were reports of illegal noise levels as well as body pains from constantly having to stand 70-80 hours per week. None of these workers received a copy of their worker contracts which is illegal in Vietnam. And alarmingly, there were reports that miscarriages were very normal for young pregnant employees working at these sites.

19 of 27

Current Events:

Climate change

&

Forced labor

20 of 27

Current Events- The Environment Company Comparisons

vs

Uses only 1% renewable energy

Now powered by 100 percent renewable energy sources
Claims to become carbon neutral by 2030

https://cleantechnica.com/2020/09/15/why-is-samsung-still-in-coal-when-everyone-else-is-moving-towards-clean-energy/

https://www.theverge.com/2018/4/9/17216656/apple-renewable-energy-worldwide-climate-change

Climate change is a huge problem that will soon be the demise of earth if individuals and large corporations do not make efforts to slow it. One of the biggest contributors is the use of greenhouse gasses. Samsung electronics claims that it considers climate change “an important challenge” and that they will make efforts to reduce greenhouse gases, however this proves to have been said for positive publicity only. Samsung is clearly not following through with this claim especially in comparison to other tech companies such as apple. While they claim to be a company focusing on renewable resources they only use one percent of renewable resources and mainly utilize coal plants while apple has looked forward and has shifted to 100% renewable resources.

21 of 27

Construction in South Korea

The 2,080 megawatt Gangneung Anin coal power plant project In South Korea

the 2,100 megawatt Samcheok coal power project.

expected to emit HUNDREDS OF MILLION TONS OF GREENHOUSE GASES over their lifetimes

22 of 27

Forced Labor- Uighurs In Xinjiang

China has detained more than a million Uighurs in Xinjiang as part of what it calls a “campaign to tackle Islamist extremism”.

Uighurs continue to live “a harsh, segregated life” once they entered the workforce of major factories

“Under conditions that strongly suggest forced labour, Uighurs are working in factories that are in the supply chains of … Samsung” the think-tank said in the introduction to its report.

https://www.independent.co.uk/news/world/asia/uighur-muslims-china-forced-labour-work-xinjiang-apple-nike-bmw-sony-gap-a9371711.html

https://medium.com/wonk-bridge/huawei-the-uyghurs-a-story-in-trade-and-terror-bcfd89cae703

https://www.bbc.com/news/world-asia-china-51697800

A current issue in the world that is lacking news coverage is forced labor camps that detained millionsof Uighurs in China under the pretences of a campaign to “tackle islamist extremism.” China has been accused of detaining more than a million Uighurs to “vocational centers.”Under these conditions that strongly suggest forced labour, Uighurs are working in factories of many different supply chains for global brands-- one include Samsung. uighurs then underwent “ harsh segregated life once they entered the workforce of major factories” “ It has been reported that it was "extremely difficult" for Uighurs to refuse or escape the work assignments, with the threat of "arbitrary detention" hanging over them. Samsungs participation in this atrocity described as “economic exploitation” is despicable and is a shame on the companies values and morals.

23 of 27

Recommendations

24 of 27

Old technology → recycling materials
Contact vendors about their recycling programs.
Combine legacy systems with new tech

Use them in conjunction to elevate efficiency

Most gadgets consume large amounts of electricity or are powered by toxic batteries → pollution and public health problems.

Recommendation:

Build Sustainable Internal Practices

25 of 27

Recommendation: Benefit People & The Planet

Environmental impact should be taken into consideration in every step of production

Implement a recycling program with used Samsung equipment
Trade in their used IT equipment for credit towards new Samsung products.

Employ environment-friendly packaging
Reduces waste and less consumption of materials hazardous to the environment

Use recycled materials as much as possible, eliminate hazardous chemicals

https://www.nasa.gov/topics/earth/overview/index.html

https://www.esg.adec-innovations.com/resources/newsletters/september-2015-how-tech-companies-are-promoting-sustainability/how-tech-companies-are-promoting-sustainability/

Secondly, in efforts to benefit people and the plant, Samsung should evaluate environmental footprint that they have on earth.

While there are many different things that Samsung can do to foster sustainability, we thought that the company could start by implementing a recycling program with their customers, where customers can send their used Samsung equipment (metals, plastics and several valuable components, etc.) back to the company. A way that they could incentivize their consumers is by offering credit towards new products for recycling their old ones.

Also, we would recommend that Samsung employs environment-friendly packaging. For example, the company could use mushroom spores and agricultural wastes like cottonseed instead of harmful styrofoam.

26 of 27

Recommendation: Policies with Little/ Positive Impact on Shareholders

Sustainability has become a trend
Shareholders are concerned about the

environment and wasteful business practices

Sustainability efforts productive for business as well

Also...

Sustainability = less illness and less compensation resulting from illness

Win-Win situation

https://forevergeek.com/20-words-to-know-to-win-every-game-of-scrabble/

https://www.greenamerica.org/press-release/200000-petitions-counting-health-labor-environment-groups-say-clean-samsung-global-day-action-against-samsung

Lastly, in order to have little but positive impact on shareholders Samsung should take into account how preventing poor business practices, will lower a company’s cost and therefore increase their overall, profit.

The company must take into account that with unethical and non-sustainable business practices, they are creating an unsafe work environment for their employees. When employees get sick, not only does that decrease morale within the company, but it also costs way more to fix the issue.

By implementing sustainability, less workers would become ill, and there would be less money contributed towards workers compensation. Workers comp costs money from direct payments and time spent fighting in court, also harms company image. So by preventing that, Samsung and its shareholders would have a win win situation.

200 employees have either died or been stricken with serious illness

leukemia, lymphoma and MS in their late 20s or early 30s.

27 of 27

. Welcome to 2020, Samsung .