[EGS Case Study] SK Telecom's case of process application for physical climate risks assessment

Increase in the air temperature, intensive heat and fire resulting from climate change causes physical impacts such as damaging the network equipment and creating troubles in the telecommunication services, which affects the SKT’s business negatively. SKT’s network equipment is installed across the country, and they are sensitive to weather changes such as high air temperature, intensive heat and fire. So, the ICT Infra Center regularly monitors risks caused by physical environmental changes and shares the status with the ESG Management Group in case of such risks. The center joins forces with the group to conduct materiality assessment on any identified risk and reports the findings to CLO and CSPO(Chief Serious-accident Prevention Officer) in case the risk is deemed serious.

A case in point is the wildfire which broke out in Gangwon Province and North Gyeongsang Province in March 2021 causing damages to SKT's telecommunication equipment. The ICT Infra Center monitored climate risks and shared the identified climate change risks with the ESG Management Group. Having recognized the potentially serious impact of wildfires on telco equipment, the center and the group worked together to perform materiality assessment on the risks resulting from physical environmental changes while reporting the results to the CLO and CSPO as the risks were identified as serious. In response, SKT established and operated an emergency response system in accordance with the CSPO’s decisions made on the risk status.

In order to minimize the damages by the wildfire, SKT launched immediate responses on the corporate-level, by operating the emergency contact system between the headquarter office and the sites. The response results were reported to the CSPO and shared with the CLO.

Source: SK Telecom CDP Response 2022 (C2.2)