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Samsung's Sustainability Efforts and COVID-19 Response: Current State and Achievements

GOOVER DAILY REPORT June 27, 2024
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TABLE OF CONTENTS

  1. Summary
  2. COVID-19 Response and Community Support
  3. Sustainability and Net-Zero Emissions Goals
  4. Marketing Strategy and Global Position
  5. Corporate Structure and Global Operations
  6. Conclusion

1. Summary

  • The report titled "Samsung's Sustainability Efforts and COVID-19 Response: Current State and Achievements" outlines Samsung Electronics Co.'s initiatives and achievements in addressing sustainability and the challenges posed by the COVID-19 pandemic. It covers Samsung's commitment to reducing its carbon footprint, transitioning to renewable energy, and promoting circular economy practices. The report also details Samsung's actions to mitigate supply chain disruptions and support community health initiatives during the pandemic. Highlights include Samsung's commitment to net-zero emissions by 2050, significant progress in renewable energy usage, and increased efforts in recycling and e-waste management. Additionally, it emphasizes Samsung's implementation of SMART Health Cards and active support for community-based programs during the COVID-19 pandemic.

2. COVID-19 Response and Community Support

  • 2-1. Supply Chain Management During the Pandemic

  • The COVID-19 pandemic brought numerous challenges to the economy and various industries, including significant disruptions in global supply chains. In response to these challenges, Samsung Electronics North America President and CEO KS Choi met with key U.S. officials, including Vice President Kamala Harris and Transportation Secretary Pete Buttigieg, to discuss solutions. During this meeting, Samsung committed to moving an additional 5,000 containers, representing a nearly 60% increase, out of the Los Angeles and Long Beach ports over a 90-day period. This initiative was part of a collaborative effort with supply chain partners, capitalizing on the ports’ transition to 24/7 operations. Samsung Electronics maintains a strong manufacturing presence in the U.S., producing semiconductors in Texas and home appliances in South Carolina. Approximately 72% of U.S. households possess one or more Samsung products, underscoring the importance of Samsung’s efforts to resolve port congestions to ensure that U.S. consumers receive necessary home appliances and electronics. Through these collective actions, Samsung aims to overcome the current supply chain challenges and continue providing essential products to American households.

  • 2-2. Implementation of SMART Health Cards

  • In an effort to promote public health safety and streamline COVID-19 vaccination verification, Samsung Electronics America partnered with The Commons Project Foundation to introduce SMART Health Cards within Samsung Pay. This collaboration allows U.S. consumers to store a verifiable digital version of their COVID-19 vaccine record from pharmacies, providers, or health systems in Samsung Pay via the CommonHealth app. This new feature is accessible on supported Samsung Galaxy smartphones, providing users with a convenient and secure method to present their vaccination status when needed for travel or entry to various venues. To add a COVID-19 vaccination record to Samsung Pay, users must download the CommonHealth app from the Google Play Store, verify their health information, and then add the vaccination credential to Samsung Pay. This functionality not only simplifies access to vaccination records but also enhances secure sharing through QR codes with trusted parties such as schools, workplaces, travel authorities, or healthcare providers. Rob White, Senior Director of Product for Samsung Pay, and JP Pollak from The Commons Project highlighted the importance of this initiative in making vaccine credentials easily accessible and secure for users.

  • 2-3. Support for Community Initiatives

  • Samsung Electronics has actively supported various community initiatives during the COVID-19 pandemic. For instance, Samsung's Veterans Community Employee Resource Group collaborated with Carry The Load, a non-profit organization dedicated to honoring and celebrating the sacrifices of military, veterans, law enforcement, firefighters, and first responders. Samsung employees participated in socially-distanced in-person and virtual activities to raise funds for programs benefiting military service members and their families. These activities included a national walk/cycle relay covering more than 15,500 miles and the annual “Dallas Memorial March” event, among other fundraising efforts. Such community support efforts emphasize Samsung Electronics America’s dedication to giving back and staying connected with local communities. The Veterans Community Employee Resource Group continues to foster employee engagement through initiatives aimed at supporting veterans and honoring their service.

3. Sustainability and Net-Zero Emissions Goals

  • 3-1. Net-Zero Emissions Plan and Progress

  • Samsung Electronics aims to achieve net-zero carbon emissions by 2030 for its Mobile and Home Appliances business (DX Division) and by 2050 company-wide, including its semiconductor division (DS Division). The company has already made significant progress, being nearly one-third complete (31%) towards its goal of becoming net-zero. Significant actions taken include reducing 10 million tonnes of CO2 emissions in 2022 and securing a 59% increase in the use of renewable energy.

  • 3-2. Renewable Energy Transition

  • Samsung Electronics has joined the RE100 initiative, committing to 100% renewable energy for all operations outside Korea by 2027. As of 2022, the company has achieved 100% renewable energy usage in the US, Europe, China, Korea DX division sites, and manufacturing sites in Vietnam, India, and Brazil. Their renewable energy usage rose by 65% in 2022. The goal for South Korea is set for 2030, despite the country's current reliance on coal and gas.

  • 3-3. Water Reuse and Recycling Initiatives

  • In 2022, Samsung increased its consumption of reused water by 29%, reaching 117 million tonnes. Samsung’s advancement in recycling includes the collection of 600,000 tonnes of e-waste, a 9% increase from 2021. This progress is part of their broader efforts to maximize resource circularity across the entire product lifecycle. For instance, Samsung has increased the use of recycled resin in plastic parts to 99,000 tonnes and sought to implement these materials in 50% of all plastic parts by 2030, aiming for 100% by 2050.

  • 3-4. Circular Economy and E-Waste Management

  • Samsung is focused on enhancing resource circularity. The company expanded its e-waste collection system to be more widespread and has committed to using recycled materials in its products. By the end of 2022, six components in the Galaxy S23 series were made from reclaimed and recycled fishing nets, and the packaging for these devices was made from 100% recycled paper. Their efforts prevented over 50 tonnes of discarded fishing nets from entering oceans.

  • 3-5. Public Education and Awareness Programs

  • Samsung has emphasized public education and awareness through various initiatives. In Southeast Asia, they have put eco-conscious practices into place at Samsung Service Centers. The ‘Go Green, Go Galaxy’ campaign encouraged device recycling by offering discounts to customers recycling old smartwatches and earbud devices. Additionally, Samsung conducts youth outreach programs like the ‘Solve for Tomorrow’ competition, fostering innovative projects among students to address sustainability.

4. Marketing Strategy and Global Position

  • 4-1. Shift from Low-Cost to Innovative Products

  • Samsung initially entered the consumer electronics market by partnering with Sanyo Lab to produce affordable televisions and microwaves. During the 1997 Asian market crash, Samsung's low-price competitive strategy proved effective. However, as the market evolved with increased competition, Samsung shifted its focus from low-cost consumer goods to revolutionary technology innovation. Under the leadership of Jon Yong Yun, Samsung transitioned to producing high-end, technologically advanced products. The release of the Galaxy GT-17500 in June 2009 marked a significant milestone, catapulting the brand to a leading position in the global market. This shift in strategy established Samsung as a foremost innovator in technology.

  • 4-2. Digital Marketing and Social Media Engagement

  • Samsung has effectively leveraged digital marketing and social media to expand its global reach. The company maintains an active presence on major platforms, with 12.4 million followers on X (formerly Twitter), 162 million likes on Facebook, and over 4.9 million Instagram followers for Samsung India. Samsung’s YouTube channel also boasts 6.53 million subscribers. These platforms allow Samsung to engage with a diverse audience and enhance brand visibility. Moreover, Samsung employs SEO and SEM strategies to optimize website traffic, resulting in a 12% boost in keyword ranking and a domain authority score of 94. By addressing user behavior and improving the online experience, Samsung has ensured that its website ranks highly on search engines, further bolstering its digital presence.

  • 4-3. Distribution and Promotional Strategies

  • Samsung utilizes a balanced marketing mix to enhance product visibility and sales. The company's product strategy focuses on meeting consumer demands with a variety of high-quality electronic items. Samsung adopts a dual pricing strategy: price skimming for new product releases and competitive pricing once market saturation is reached. This approach helps maintain market share amid competition. The distribution strategy centers on customer convenience, with products available through service dealers, retailers, and an easy-to-use eCommerce store. Promotionally, Samsung allocates significant budgets for marketing, including celebrity endorsements, sponsorships, and targeted digital campaigns. The company's marketing endeavors aim to enhance brand awareness, drive sales, and strengthen customer relationships through innovative and emotionally impactful advertising.

5. Corporate Structure and Global Operations

  • 5-1. Corporate Overview

  • Samsung Electronics Co., Ltd. is a South Korean multinational major appliance and consumer electronics corporation headquartered in Yeongtong-gu, Suwon, South Korea. It is the leading subsidiary of the Samsung Group, accounting for 70% of the group's revenue as of 2012. Samsung Electronics plays a significant role in the group's corporate governance due to cross ownership. It has been involved in the development and manufacturing of a range of products including consumer electronics, telecommunications equipment, and home appliances. The company has also been heavily involved in the manufacturing of electronic components such as semiconductors, image sensors, camera modules, and displays.

  • 5-2. Global Presence and Workforce

  • Samsung Electronics has a global presence with assembly plants and sales networks in 74 countries. The company employs more than 270,000 people worldwide. As of 2019, Samsung Electronics was the world's second-largest technology company by revenue, with a market capitalization of USD 520.65 billion, making it the 12th largest in the world. Samsung is the world’s largest manufacturer of smartphones since 2011 and has maintained the position of the largest television manufacturer since 2006. In the semiconductor sector, Samsung is the world's largest semiconductor memory manufacturer and was briefly the largest semiconductor company globally from 2017 to 2018.

6. Conclusion

  • Samsung Electronics has demonstrated considerable progress in its sustainability initiatives and agile response to the COVID-19 pandemic. The company's objective to achieve net-zero emissions by 2050, alongside a notable increase in renewable energy use and innovations in recycling and e-waste management, underline its commitment to environmental stewardship as defined by its sustainability goals. Samsung’s swift adaptation to pandemic-induced challenges, including supply chain management and introduction of SMART Health Cards, showcases its resilience and dedication to social responsibility. Despite facing challenges such as a substantial carbon footprint, Samsung’s proactive strategies and collaborations offer a solid foundation for future advancements. However, further investigation is required to evaluate the long-term global impacts of these initiatives on broader environmental and social metrics. Moving forward, Samsung’s efforts in sustainability will likely set industry benchmarks, influencing positive changes within and beyond the technology sector. Practical applications of these findings can enhance corporate strategies, policymaking, and community engagement models on a global scale.

7. Glossary

  • 7-1. Samsung Electronics Co. [Company]

  • A South Korean multinational major appliance and consumer electronics corporation, accounts for 70% of the Samsung chaebol's revenue. Known for its Samsung Galaxy brand, it is the world’s second-largest technology company by revenue. Samsung has committed to sustainability and addressing COVID-19 impacts through several key initiatives and strategies.

  • 7-2. COVID-19 [Event]

  • A global pandemic that has significantly impacted businesses worldwide. Samsung addressed supply chain disruptions and supported health initiatives such as promoting SMART Health Cards and community support programs during this period.

  • 7-3. Net-Zero Emissions [Environmental Goal]

  • Samsung's commitment to achieving net-zero carbon emissions by 2050. This involves transitioning to renewable energy, enhancing recycling processes, improving water reuse, and investing in eco-friendly technologies and practices.

  • 7-4. Sustainability [Issue/Objective]

  • Samsung's ongoing efforts to promote environmental sustainability through various initiatives such as reducing carbon emissions, increasing use of recycled materials, e-waste management, and public education programs.

8. Source Documents