Yeongpung Group's main business site, 'Yeongpung Seokpo Smelter,' is faltering due to major ESG (Environmental, Social, and Governance) legal risks such as serious accidents and environmental pollution.
According to a comprehensive report by the Legal News on the 29th, the Daegu District Prosecutors' Office is investigating and has booked officials on charges that the Seokpo Smelter polluted the surrounding environment. A Yeongpung Group official stated, "It is true that we are under investigation by the prosecution regarding this matter, but we cannot disclose specific details."
Located in Bonghwa-gun, Gyeongbuk Province, Yeongpung Seokpo Smelter is Yeongpung Group's main business site, a non-ferrous metal smelter producing up to 400,000 tons of zinc annually. The Seokpo Smelter has consistently been identified as the source of environmental pollution in nearby areas such as the Nakdong River and Andong Dam.
During the National Assembly Environment and Labor Committee's audit held in October last year, criticism arose over environmental pollution issues. At that time, Kim Hyeong-dong, a member of the People Power Party, pointed out regarding the Seokpo Smelter, "It has been three quarters since the Ministry of Environment began integrated management recently, but the number of violations remains high. As of the third quarter, there were nine violations," adding, "There were also three cases of prosecution, which means these are subject to criminal penalties."
Previously, the Seokpo Smelter was fined 28.1 billion KRW by the Ministry of Environment in 2021 for illegally discharging cadmium-contaminated water into the Nakdong River over several years. In 2020, the smelter's executive director and others were sentenced to prison for manipulating the concentration of air pollutants in 1,868 cases over three years.
The legal risks of the Seokpo Smelter do not end there. Last month, Yeongpung's CEO is also under investigation by the Ministry of Employment and Labor and the police due to an acute toxic gas poisoning accident that occurred at the Seokpo Smelter site.
On the 6th of last month, four workers at the Seokpo Smelter suffered acute poisoning from arsine gas containing arsenic. One worker in his 60s, employed by a subcontractor, died on the 9th after receiving treatment at a hospital. Another worker is reported to be in critical condition.
Regarding this accident, the Daegu Regional Employment and Labor Office booked Yeongpung Corporation and CEO Park Young-min on charges of violating the Serious Accidents Punishment Act on the 9th. Bae Sang-yoon, CEO of Yeongpung and head of the Seokpo Smelter, was also booked on charges of violating the Industrial Safety and Health Act. Earlier, on the 4th of this month, the Labor Office and Gyeongbuk Police Agency conducted raids on Yeongpung Group's headquarters in Gangnam-gu, Seoul, and the Seokpo Smelter.
Civic groups and others are urging that the investigation be expanded to directly target the Yeongpung Group owner, who is the actual person responsible for the Seokpo Smelter.
The Yeongpung Seokpo Smelter Bonghwa-gun Countermeasure Committee and others announced on the 15th that they filed a complaint with the Daegu Regional Employment and Labor Office and Gyeongbuk Police Agency against Jang Hyeong-jin, an advisor to Yeongpung Group, on charges of violating the Serious Accidents Punishment Act and the Chemical Substances Control Act related to the toxic gas leak accident. Advisor Jang served as Yeongpung's CEO until 2015 and stepped down as chairman of Yeongpung Group in 2018. As of September last year, he held 0.68% of Yeongpung's shares. Including the 16.89% stake held by Jang Se-jun, CEO of Korea Circuit and eldest son of the largest shareholder Jang, the family’s total stake amounts to 29.29%.
These groups stated, "The actual management responsible for Yeongpung Smelter must be investigated and severely punished," adding, "Only by doing so can the purpose of the Serious Accidents Punishment Act be properly fulfilled, ensuring a safe workplace that prevents recurrence."
Lim Hyun-kyung, Legal News Reporter
※This article is based on content supplied by Law Times.
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