Hyundai Motor

Hyundai is one of the few companies that has set targets to reduce its upstream scope 3 emissions from the production of materials used in vehicle manufacturing. It aims to reduce these by 10% by 2030, 40% by 2035, 60% by 2040 and 90% by 2045, compared to 2019. However, the company does not disclose enough emissions data to meaningfully assess this target. Hyundai can improve its performance by disclosing emissions intensity data as well as setting a short-term, intermediate target for 2028.

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

Hyundai’s downstream scope 3 emissions targets could not be assessed as no data was found of the company’s base and reporting year emissions intensity. Its target to become net zero across scope 1, 2 and 3 emissions by 2045 could also not be assessed as it is unclear if it plans to use offsets. Reducing emissions related to its operations and products should remain the company’s priority. Furthermore, the company should disclose the proportion of each target that will be met through direct action, rather than including offsets.

Hyundai has implemented board-level oversight and incentives for managing the low-carbon transition. The company has a comprehensive low-carbon transition plan informed by climate scenario analysis that has considered the implications of a 1.5°C scenario. However, it does not disclose its used carbon price. Hyundai can improve its performance by including and disclosing a carbon price that aligns with the expectations set by the International Energy Agency’s (IEA’s) Net Zero Emissions (NZE) Scenario.

By 2032, Hyundai plans to invest USD 26 billion in low-carbon technologies and measures. Yet, the company failed to disclose its low-carbon capital expenditure (CapEx) in 2023 and had a low-carbon research and development (R&D) share of only 5%. Only 6% of Hyundai’s total vehicle sales consisted of low-carbon vehicles in 2023. Reducing emissions aligned with a 1.5°C pathway requires companies to continue increasing their sales of low-carbon vehicles and reducing ICE sales. Hyundai needs to step up its ambition to meet its 1.5°C pathway, which requires 67% of sales in 2030 to consist of low-carbon vehicles.

Hyundai demonstrates contradicting positions on climate policy. The company advocated for the Paris Agreement. However, it has both negative and positive positions on electrifying road transport, while promoting a longer-term role for ICE-powered vehicles. Hyundai is on the board of the Federal Chamber of Automotive Industries, which has opposed the Australian climate policy for light-duty vehicles. Hyundai does not have a policy in place to manage engagement with trade associations on climate change issues. It can increase its credibility by developing and publicly publishing a monitoring and review process to ensure its policy positions, and those of its trade associations, are aligned with the Paris Agreement goals.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.  No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.   No public commitment by the company was found stating its intention to reskill and upskill workers displaced by the transition to a low-carbon economy. Additionally, no evidence was found that the company reskills and upskills workers in a way that ensures gender balance and inclusion of vulnerable groups. 

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.  No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers. 

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. Furthermore, the company discloses a human rights due diligence process that includes the identification of salient human rights risks. The company does not assess or take action to mitigate these risks in its own operations and its supply chain, but it does engage with affected stakeholders. Additionally, the company has a grievance mechanism available to workers and external stakeholders. 

The company commits to respecting the health and safety of its workers and expects the same commitment from its business relationships. However, it has not set a time-bound target for paying all workers a living wage and does not limit required working hours to 48 hours per week. It also does not disclose the proportion of its direct workforce covered by collective bargaining agreements. The company discloses some indicators of workforce diversity, including the gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. The company does not have a commitment towards gender equality and women’s empowerment. 

The company does not commit to protecting personal data but discloses a privacy statement regarding the use of personal data. It does not disclose its global tax strategy or board accountability for the strategy. The company has a policy prohibiting bribery and corruption and includes corresponding clauses in its contracts with business relationships. However, it does not describe its process to identify the bribery and corruption risks and impacts in its own operations. The company does not have a lobbying and political engagement policy, though it specifies that it does not make political contributions.