NOT CURRENT YEAR

Grade D+
ChemScore report card 2021

Lotte Chemical

Lotte Chemical Corporation manufactures a wide range of petrochemical products such as high-density polyethylene, polypropylene, and ethylene glycol. Lotte Chemical’s products are used in the manufacture of general housewares, pipes, films, fabrics, bottles, containers, and automotive parts. The company has almost 10,000 employees, of which about half are located in South Korea.
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Total score
11 / 48

Grade Summary

To our knowledge, there are no hazardous chemicals in Lotte Chemical’s product portfolio. However, the company is only awarded two points in the first category, due to the fact that there is no available data for the 87 percent of the company’s production that takes place outside of the EU and US. This low transparency is a big issue for investors, as it makes it hard to do a proper evaluation of the risks connected to the product portfolio. Another poor area for Lotte Chemical is the Management & Transparency category, where it scores two points less than last year, due to lacking a clear code of conduct as well as a chemical management strategy. In the other categories, the company places itself very much in the middle. It doesn’t really excel in anything, but is not among the worst performers either.

Opportunities for improvement

  1. We can only rank 13% of Lotte Chemical’s overall production, since the rest takes place outside the EU and US, where there are no reliable and publicly available sources for identifying producers of hazardous chemicals. Informing ChemSec about hazardous chemical production outside the EU and US could raise the company’s score considerably.
  2. Lotte Chemical scores really low in the Management & Transparency section. The company’s code of conduct lacks clear commitment to the codes requested by the suppliers – it only refers to fair contracts. Lotte Chemical should also develop clear chemical management practices and a circular economy strategy.
  3. A systematic assessment of the intrinsic hazards of Lotte Chemical’s products is lacking. Knowledge is a basic requirement for managing chemicals without risking human health and environmental implications.

Category breakdown

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Product Portfolio
2 / 18

Lotte Chemical produces/uses no highly hazardous substance. However, much about Lotte Chemical’s product portfolio is unknown due to the company’s large production that takes place outside of the EU and US.

Please note that there is no available data for the 86 percent of the company’s production that takes place outside of the EU and US. Lower EU/US production means higher uncertainty with regard to the total production of hazardous chemicals, which will have a negative impact on the company’s score in this category.

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Development of Safer Chemicals
5 / 12

Lotte Chemical has a method in place to screen and assess the sustainability of its products, but does not include the intrinsic hazards of ingredients in the screening process. Neither does it exclude substances with toxic properties from its new products. Lotte Chemical actively markets safer alternatives both on its own website as well as on ChemSec Marketplace. The company does not have any true circular products, processes or innovations. Lotte Chemicals does not use bio-based resources, but it sources and treats recycled materials in a sustainable way, which is one of the key elements of a circular economy. Lotte Chemical is actively reducing the hazardous waste it generates.

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Management & Transparency
1 / 12

The Korean company does not produce only sustainable products and it does not have a timed phase-out strategy for hazardous substances that go beyond regulatory compliance. It shares chemical safety information on its website, but does not follow a credible code of conduct standard. Lotte Chemical did not respond to ChemSec’s attempts to communicate around its ChemScore ranking and it does not share any information about what kind of chemicals it produces in regions with low regulatory demands for transparency (e.g. Asia). Lotte Chemical does not have a circular economy program in place, and it is lacking objective and measurable circular economy targets.

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Lack of Controversies
3 / 6

Last year, an explosion at a Lotte Chemical plant in South Korea left 32 persons injured. Lotte Chemical is one of the top three chemical giants, along with LG and Hanwah, that are under investigation for Korea’s Hazegate scandal of 2019 where the company was found colluding with pollution reporting agencies to fudge and misreport air pollutant emissions data. Two years earlier, the plant was issued a stop work order following two separate incidents involving a fire and an odour and surface oil sheen incident.

Download Controversies Lotte Chemical (PDF, 112 KB)
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Overall rank
29 / 50
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Total score
11 / 48
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Product Portfolio
2 / 18
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Development of Safer Chemicals
5 / 12
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Management & Transparency
1 / 12
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Lack of Controversies
3 / 6
Download report
Other years
Year Rank Total score
2023 21 / 50 15 / 48
2022 43 / 54 9 / 48
2021 29 / 50 11 / 48
2020 30 / 35 9 / 48