POSCO Group Focusing On Green Materials To Achieve Sustainable Growth

POSCO Group CEO Jeong-Woo Choi shares how he is growing the company into a world-class green materials provider.
Jeong-Woo Choi, POSCO Group CEO

Starting from a small fishing village in Pohang, South Korea more than 50 years ago, POSCO has grown to become one of the largest steel companies in the world. Two of the key reasons behind the company’s success are its focus on sustainable growth and becoming a responsible corporate citizen.

Today, POSCO Group is moving towards becoming a world-class green materials provider and has embarked on many initiatives to make the world greener and reduce carbon emissions.

POSCO Group CEO Jeong-Woo Choi, who recently won the CEO of the Year award at the 10th Global Metals Awards by S&P Global Commodity Insight and was appointed as the Chairman of the World Steel Association, shares the company’s future plans and his thoughts on the importance of sustainable practices and the steel industry’s future direction.

POSCO Group has grown significantly over the past four years. What are your priorities for the company in the near future?

POSCO Group aims to become a world-class green materials provider using innovative technologies that have not existed in the past. These green materials will be used in industries such as future mobility, housing and infrastructure, and will contribute to the realization of future eco-friendly values such as carbon neutrality.

One of the green materials that we are working on is green steel. Currently, we are working on a technology called HyREX or hydrogen reduction, which could significantly reduce carbon emissions in the steelmaking process. By 2028, we hope to build a HyREX demo plant and commercialize the technology by 2030.

The group is also looking at expanding its domestic and overseas production bases for cathode and anode materials in the rechargeable battery material business. We will also start the saltwater-based production of lithium with an annual capacity of 50,000 tons in Argentina in 2025. This will play an essential role in helping the group achieve its goal of 300,000 tons of lithium production by 2030.

Another priority for us is to grow the secondary battery material business, which is also one of our fastest growing businesses. Last July, we held an investor relations event for the secondary battery material business and presented our 2030 goals for significant materials such as nickel (220,000 tons), cathode material (610,000 tons), and anode material (320,000 tons). We also target to achieve KRW 41 trillion (US$30.8 billion) in revenue by 2030.

POSCO Argentina lithium demo plant

How important is Environmental, Social and Governance (ESG) to POSCO Group? What are the ESG initiatives promoted by the company?

POSCO Group has implemented the management philosophy of corporate citizenship since 2018. In July 2019, the corporate citizenship charter was released, with the details and the practice principles elaborated. The charter mainly embraces what ESG stands for.

We have also established the ESG discussion committee, where key management, including CEOs of the holding and operating companies, participates every quarter to debate and discuss the responsive measures on ESG issues such as climate change, safety, diversity, and inclusion, which are considered crucial by our internal and external stakeholders.

An advanced governance system is also set up to detail what was discussed and report the result to the board of directors and ESG committee before it is communicated to stakeholders. We plan to develop the process further.

How important is Environmental, Social and Governance (ESG) to POSCO Group? What are the ESG initiatives promoted by the company?

POSCO Group has implemented the management philosophy of corporate citizenship since 2018. In July 2019, the corporate citizenship charter was released, with the details and the practice principles elaborated. The charter mainly embraces what ESG stands for.

We have also established the ESG discussion committee, where key management, including CEOs of the holding and operating companies, participates every quarter to debate and discuss the responsive measures on ESG issues such as climate change, safety, diversity, and inclusion, which are considered crucial by our internal and external stakeholders.

An advanced governance system is also set up to detail what was discussed and report the result to the board of directors and ESG committee before it is communicated to stakeholders. We plan to develop the process further.

You have been recently appointed as the Chairman of the World Steel Association. What are some of your key priorities in this new role?

POSCO Group CEO Jeong-Woo Choi (left) was appointed as the Chairman of the World Steel Association.

Many countries, companies and organizations have set the goal of achieving carbon neutrality by 2050. However, the practical methods and technologies we have currently fall short of meeting this target.

Instead of partially modifying the process based on current technologies and facilities, we need to develop new technologies for commercialization and set up the relevant facilities covering raw materials for product manufacturing.

In addition, the materials used for new facilities need to be produced with carbon neutrality and supplied to steel mills. It is another challenge to the new supply channels for carbon-neutral raw materials.

To overcome the challenge, the World Steel Association plans to develop ongoing projects in each category and try a new approach. First, we plan to strengthen the sharing of technology innovation among steel companies and promote cooperation with other industries to create a carbon-neutral ecosystem. We will hold conferences for industry players to keep abreast of the progress on carbon neutrality and new technologies such as HyREX.

Second, we plan to design an intelligent safety solution that can fit a new decarbonized production process. The new carbon-neutral steelmaking process has been developed and is headed toward commercialization. In this regard, we must proactively prepare for a unique and potential industrial risk.

Third, we plan to define the standards for green steel. There is rising demand and interest from various industries for green steel. However, there are no common criteria or standards for this.

In determining the standards for green steel, we plan to involve steel companies, customers and third-party independent certification institutes in the discussion. In addition, we plan to define green steel within a set timeline by considering a roadmap for developing carbon neutrality technology.

Last but not least, we will try to secure the supply network of eco-friendly fuel and raw materials for green steel production. We plan to create a venue where not only global raw material partners but also renewable energy and hydrogen producers and relevant associations can discuss while sharing information about a broad scope of topics, including demand forecast, procurement risk, and each country’s policy direction. In addition, we will strive to enhance the recyclability of steel by standardizing the categorization system for steel scraps.

You were also named CEO of the Year at the 10th Global Metals Awards by S&P Global Commodity Insight. What was your initial reaction?

POSCO Group awarded “Metals Company of the Year”, “Industry Leadership Award: Steel”, “Deal of the Year” as well as “CEO of the Year”.

While I am honored to receive the award, I need to reiterate that this achievement is possible only with the dedication of all the employees of the POSCO Group. Hence, I want to share this recognition with all the executives and employees of the group, too.

I hope that all of us at POSCO Group will remain committed to making POSCO a good corporate citizen and to building a better, more sustainable future together. 

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www.posco-inc.com 

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