Compliance Management

LOTTE Chemical’s goal is to strengthen its social responsibility and realize core values by establishing the compliance culture.

Introduction of LOTTE Chemical’s Compliance

LOTTE Chemical is implementing the global standard compliance system to play the leading role in fulfilling its social responsibility.
We are operating programs to build the culture of all employees complying with laws and to prevent the compliance risks related to fair trade, anti-corruption, and safety/environment in business activities to ensure the compliance management based on sound corporate philosophy.

Furthermore, as global regulations and stakeholder monitoring related to ESG management strengthening, we are revising and operating the compliance management system considering the level of compliance risk exposure that is growing due to changes in the corporate management environment and growth of the company.

Operation of Compliance Support System

The BOD enacted the compliance control standard in 2012 and introduced the compliance support system by appointing the compliance officer.
The appointed compliance officer manages compliance that includes voluntary compliance of fair trade. The Compliance Team formed in 2018 reports to the BOD regularly to support the compliance responsibility.
We will deduce major issues considered from the aspects of various stakeholders as well as various regulations and compliance risks related to ESG, and advance the compliance system by establishing risk monitoring and evaluation management operating systems.

Auditing and prevention of Reoccurrence,Investigation of violations and punishment of violators Report system with guaranteed anonymity,Upgrading of Internal Regulation,Announcement of enactment of Compliance Management Charter and Compliance Management Policy
                            Establishment of regulations related to anti-corruption and fair trade Publication of Handbook, Do's & Don'ts, and checklist available for employees to use and refer to in the field,Internal Reporting, Monitoring, and Risk Detection,
                            Operation of the internal reporting channel Detection, follow-up, and resolution of risk through the IT monitoring system, Establishment and Operation of a Dedicated Organization,Establishment of Compliance Team under the Compliance Management Part of CEO Office,
                            Internal Accounting Control,Operation of effective internal accounting management system,Regular Education & Counseling,Online and Offline education,Compliance advice

LOTTE Chemical’s Compliance Management Charter

Every employee of Lotte Chemical Corporation (hereinafter referred to as "the Company") aims to grow into a company that is appreciated by the public and fulfills its social responsibilities under the mission of "We enrich people's lives by providing superior products and services that our customers appreciate and depend on." and complies with the following compliance management charter.

Article 1 (Course of Action by Employees)
① We perform our job responsibly with honest and sincere attitude and establish a corporate culture of mutual respect and trust.
② We will do our best to increase the value of the company by transparent and efficient management and maximize the rightful profit of the stockholders.
③ With customer satisfaction as the top priority, we provide the best quality products and services that our customers want.
④ We establish a fair and transparent trade with partner companies and pursue mutual growth by strengthening the partnership.
⑤ We respect competitors, comply with relevant laws and regulations, and pursue fair and free competition.
⑥ As an eco-friendly enterprise, we will strive for continuous development and contribute to the preservation of the earth and the prosperity of humankind.
⑦ We fulfill corporate social responsibility by complying with the law and contributing to the public interest of the country and communities.
⑧ We respect human rights and strive for the protection of the vulnerable by taking affection and respect for people as core values.

Article 2 (Duties and Responsibilities of Employees)
① We must be the role model for the most stringent ethical standards and create and maintain a culture in which reliability, honesty, morality, and mutual respect are valued.
② We should be thoroughly familiar with and understand related laws, company policies, and internal regulations (hereinafter referred to as "Related Regulations") applied to the business process and continuously check compliance with Related Regulations when conducting daily business.
③ If we are not sure of what kind of response is appropriate in a specific situation, we should consult with a senior person, corporate legal team, and compliance support organization such as Compliance Team to draw the legal and best ethical conclusion.
④ In case of being aware of the violation of Related Regulations, we should promptly take the appropriate measures to identify and prevent the wrongful act. If a situation arises to make it difficult to act ethically on behalf of the Company or if we are aware of such situation, we should consult with the support department.

Article 3 (Duties and Responsibilities of the Company)
① The Company should thoroughly inform all employees about Related Regulations to ensure fair and transparent work performance and regularly conduct compliance training.
② The Company should establish a management system that allows employees to audit or check compliance with Related Regulations autonomously and supervise whether it is implemented regularly.
③ The Company should protect employees who report cases of violation or suspected violation of Related Regulations and should not impose any disadvantage.
④ If the Company is aware of the violation of Related Regulations by an employee, the Company should take measures and bring the employee to account for the wrongful action. LOTTE Chemical Corporation

LOTTE Chemical's Anti-Corruption Policy

In order to establish the anti-bribery management system and maintain ethical and compliance management by setting the code of conduct for the management and staff of the Company to prevent corruption, Lotte Chemical Corporation ("Company") sets forth and hereby declares anti-corruption policy as follows :

1. All management and staff of the Company must comply with the domestic and international laws and regulations on corruption prevention, Company’s internal regulations, and the requirements of
anti-bribery management system. Furthermore, all management and staff of the Company must not engage in any acts of corruption.

2. Company shall establish, constantly implement and develop anti-bribery management system to eliminate and reduce the compliance risk. Furthermore, all management and staff of the Company shall
sign andimplement a pledge annually in order to prevent corruption and adhere to it.

3. Company grants the authority to the head of anti-corruption related to the prevention of corruption and guarantees independence.

4. All management and staff of the Company shall immediately report to the Company any violation of anti-corruption laws or regulations. Company shall ensure the personal information of the complainants in
strict confidence, and protect them being assessed, placed on the basis of such reports and subjected to adverse economic treatment.

5. Company may take disciplinary action in accordance with Company’s regulations if the management and staff of the Company violate or fail to take reasonable measures to prevent violation of this policy or
related anti-corruption laws and regulations.
July 15th, 2019 LOTTE Chemical Corporation