Can we trust corporate ESG management 100%? Through ESG reports, companies promise environmental protection, social responsibility, and transparent governance. A brand by a renowned domestic designer touted ‘ESG management’ and reprocessed carryover products, yet consumers did not accept this as a value provided by the brand.
What these cases reveal is that the ESG that companies conceive of and the ESG that consumers experience are different.
ESG as Proven by Companies: Reports Filled with Numbers and Certifications
This past January, the security practices of the three major domestic telecommunications companies once again came under scrutiny. Telecom companies such as SK Telecom, KT, and LG U+ have been emphasizing ‘information security’ and ‘cybersecurity’ as key non-financial performance indicators in their annual ESG reports. SK Telecom touted its AI-based real-time monitoring and zero trust security architecture, while KT promoted annual information security investments on the scale of KRW 100 billion. LG U+ also received the highest grade in the government’s information security evaluation, and all three telecom companies received comprehensive A grades from the Korea ESG Standards Institute (KCGS).
[SK Telecom certified dealership apology posted © Yonhap News]
However, the reality was different. KT caused personal information leakage damage through poor femtocell (ultra-small base stations installed in homes or small business premises, directly connected to the mobile carrier’s core network) management, applying the same 10-year certificate to all devices. SK Telecom also experienced a massive USIM information leak and malware infection incident in April last year. LG U+ faced allegations that, after being notified of suspected personal information breaches, it reinstalled or destroyed some servers in an attempt to conceal the incident — behavior contrary to the ESG report’s promise to ‘build customer and social trust.’
[WOOYOUNGMI Black Palm Hoodie from the first half of 2025 season (top), Black Flower Patch Hoodie from the second half of 2025 season (bottom) © Shinsegae Mall and WOOYOUNGMI website captures, Hankyoreh]
As the controversy grew, WOOYOUNGMI explained that it was “a process of fulfilling corporate social responsibility by reducing resource waste as part of ESG management.” They viewed the product as a new item that had undergone additional processing and redesign, and thus judged that a separate disclosure obligation was unnecessary. While they acknowledged the confusion caused to consumers and stated they would supplement their notification standards going forward, consumers reacted with shock at the fact that the brand had sold inventory products as new items.
For Consumers, Action Matters More Than Claims
What companies include in their ESG reports are mainly measurable quantitative indicators, such as board and ESG governance structures, environmental performance metrics, and whether policies have been established. Such indicators are good for external promotion.
For consumers, however, ESG means what they ‘experience in daily life’: a company’s response and accountability when problems arise, and the safety of their personal information. It is not the dazzling figures in reports but the experience a company provides that is, in fact, ESG.
[KT ESG Report © KT]
In the telecom hacking incidents, the point at which consumers were angered was not ‘insufficient investment in security.’ It was the actual security systems that differed from what was stated in reports, and the opaque response. In the WOOYOUNGMI controversy as well, trust in the brand fell not so much because of the ‘use of inventory’ itself but because consumers had not been notified in advance.
ESG reveals its true value not in ordinary times but in crisis situations. When a hacking incident occurs, whether the telecom company transparently discloses its response speed and routine management processes is what matters. For a brand, when there is a possibility of a product issue arising, how it explains it to consumers is the real measure of ESG management. What matters more than the fine phrases in reports is actual behavior.
For ESG to become a company’s management philosophy, companies must make their ESG reports into ‘real promises.’ What matters more than the dazzling figures in reports is transparency. The evaluation criteria for reports must also be improved. Substantive items such as accident response, consumer protection, and transparency of communication must be more strongly reflected in evaluations.
Aligning words with actions so that consumers do not doubt the ESG that companies speak of — this is the task for companies practicing ESG in 2026.
by Editor N