Sustainability Report and ESG Performance Data
LG Chem pursues sustainable innovation based on 『Sustainability Vision』, which includes customer, environment and social value throughout its business activities.
Overview of ESG Key Indicators

LG Chem established its sustainability vision and strategy in 2019 based on nine focus areas and declared mid- to long-term goals including “Carbon-neutral Growth” in 2020. In 2021, seeking to invigorate communications with stakeholders and strengthen business competitiveness, LG Chem selected key indicators in the areas of environmental, social, governance, and growth, based on the concept of stakeholder capitalism proposed by the World Economic Forum (WEF). To keep pace with sustainable growth as a Top Global Science Company, LG Chem advanced its carbon-neutral growth goal by 20 years and announced a new target of “2030 Carbon-neutral Growth” and “2050 Net-Zero” for Scope 1 and 2 emissions. LG Chem is constantly assessing risks and opportunities, and conducting a comprehensive review of the potential short-, mid- to long-term business impacts across the entire value chain of the petrochemicals, advanced materials, and life sciences industries. By doing so, LG Chem is staying abreast of global megatrends and stakeholder demands as they evolve year to year.

Analysis of Key Stakeholder Interests

LG Chem listens to the needs and concerns of key stakeholders – customers, employees, suppliers, communities, governments, shareholders and investors, etc. – through various communication channels. LG Chem shares key stakeholder interests with the management and the Board of Directors and integrates them into corporate strategy and sustainability goals. Through active communication with stakeholders, LG Chem strives to proactively respond to changes in the business environment and enhance sustainability performance to create differentiated value for the environment and society.

Materiality Assessment Process

In 2023, LG Chem conducted a materiality assessment based on the concept of double materiality to determine material topics for sustainability reporting and identify and select material topics for mid- to long-term sustainability management. Based on the existing methodology, LG Chem has updated the materiality matrix with “impact materiality (inside-out perspective)” to assess the impact on the environment and society, and “financial materiality (outside-in perspective)” to assess the impact of external circumstances.

Scope of Reporting

This report covers information and performance data collected from LG Chem’s headquarters, sales offices, 31 domestic and global production sites, and R&D campuses, excluding data from LG Energy Solution and FarmHannong. Some financial information has been prepared in accordance with the consolidated financial statements of K-IFRS. Any statement with a different scope of reporting is explicitly noted.

ESG Key Indicators
  • High Impact

  • Medium Impact

  • Low Impact

"Category, Key ESG Indicators, Financial Materiality, Impact Materiality"
Category Key ESG Indicators Financial Materiality Impact Materiality
Environmental
Greenhouse Gas Emissions
Energy Consumption
Water Withdrawal, Consumption, and Discharge
Water Pollutants Discharge
Air Pollutant Emissions
Waste Disposal and Recycling
Product Responsibility and Chemical Stewardship
Material Reuse and Recycle
Social
Employee and Process EH&S
Diversity, Equity, and Inclusion
Talent Attraction, Training, and Employee Engagement
Labor and Human Rights
Supply Chain Sustainability
Community Engagement
Governance
Corporate Governance
Corporate Behavior and Ethics
Information Security and Cybersecurity
Public Policy and Regulation
Growth
Sustainable Solutions
Customer Satisfaction
Greenhouse Gas Emissions

We seek to reduce and manage our scope 1, 2, and 3 GHG emissions by setting reduction targets and proactively identifying the risks and opportunities arising from our emissions.

"Category, Scope, Unit, 2021, 2022, 2023"
Greenhouse Gas Emissions Unit 2021 20221) 20232)
Scope 1+2 Emissions Global tCO2e 10,335,203 10,035,577 9,558,199
Korea tCO2e 8,839,571 8,616,934 8,129,037
excl. Korea tCO2e 1,495,632 1,418,643 1,429,162
Emission intensity3) tCO2e / KRW 1M 0.4444 0.4090 0.4600
Scope 1 Emissions Global tCO2e 5,439,321 5,628,898 5,176,673
Korea tCO2e 5,290,343 5,489,586 5,032,008
excl. Korea tCO2e 148,978 139,312 144,665
Emission intensity tCO2e / KRW 1M 0.2339 0.2294 0.2491
Scope 2 Emissions Global tCO2e 4,895,882 4,406,678 4,381,526
Korea tCO2e 3,549,228 3,127,348 3,097,029
excl. Korea tCO2e 1,346,654 1,279,330 1,284,497
Emission intensity tCO2e / KRW 1M 0.2105 0.1796 0.2109
Scope 34) Emissions Korea tCO2e 1,339,125 1,217,390 11,471,953
Category 1. Purchased goods and services tCO2e 571,164 425,556 10,215,107
2. Capital goods tCO2e 56 83 245,912
3. Fuel and energy-related activities
(not included in
Scope 1 or 2)
tCO2e 175,732 193,940 399,605
4. Upstream transportation and distribution tCO2e 197,919 124,744 611,329
5. Waste generated in operations tCO2e 63,358 61,972 Developing calculation methods
6. Business travel tCO2e 970 621
7. Employee commuting tCO2e 7,488 10,474
15. Investments tCO2e 322,438 400,000

1) Figures for Scope 1 and Scope 2 emissions in Korea in 2022 have been partially revised based on the verification results of the Ministry of Environment.

2) Figures for Scope 1 and Scope 2 emissions in Korea in 2023 are based on values reported to the Ministry of Environment, and the above figures are subject to revision depending on the verification results.

3) Emission Intensity = Global GHG Emissions / Revenues excluding LG Energy Solution, and Common and others. Figures for emission intensity in 2021 and 2022 have been partially revised due to the restatements reflecting discontinued operations.

4) Calculation of Scope 3 emissions have been limited to select categories of the Greenhouse Gas (GHG) Protocol's Corporate Value Chain (Scope 3) Accounting and Reporting Standard (2011).

LG Chem's Scope 3 Emissions Reporting

  • With the introduction of sustainability reporting and climate disclosure rules and the growing importance of Scope 3 management, we are reexamining our data collection and calculation methods for Scope 3 emissions.

  • The calculation is based on the GHG Protocol's Corporate Value Chain (Scope 3) Accounting and Reporting Standard (2011). In 2023, we expanded the scope of activity data collection and calculated Category 1 to 4 emissions using the emission factors for each activity
    (Figures for Scope 3 emissions in 2021 and 2022 remain unchanged from last year's report and were not recalculated using the 2023 calculation criteria).

    1. Category 1: Calculated emissions based on the purchase statements (more than 95% of the relevant purchase amount) of key material inputs (raw materials, intermediary goods, goods) of Petrochemicals and Advanced Materials businesses.
    2. Category 2: Calculated emissions based on asset statements of acquired, acquired/replaced tangible goods (buildings, facilities, machinery, vehicles, equipment, etc.).
    3. Category 3: Calculated emissions based on external fuel and energy purchases on the Statement of Greenhouse Gas Emissions.
    4. Category 4: Calculated transport-related emissions based on goods calculated in Category 1.
  • We plan to continue reviewing and developing calculation methods for other categories relevant to our value chain.

Energy Consumption

We aim to improve energy efficiency throughout our operations to reduce energy consumption, and actively source renewable energy to achieve 100% renewable energy use.

"Category, Scope, Unit, 2021, 2022, 2023"
Energy Consumption Unit 2021 20221) 20232)
Total Energy Consumption Global TJ 147,322 151,401 133,424
Korea TJ 138,022 142,386 124,335
excl. Korea TJ 9,300 9,015 9,089
Energy intensity3) TJ / KRW 1M 0.0063 0.0062 0.0064
Direct Energy Consumption (Fuel) Global TJ 109,043 107,352 96,272
Korea TJ 106,349 104,876 93,692
excl. Korea TJ 2,694 2,476 2,580
Energy intensity TJ / KRW 1M 0.0047 0.0044 0.0046
Indirect Energy Consumption
(Steam, Electricity)
Global TJ 38,279 44,049 37,152
Korea TJ 31,673 37,510 30,643
excl. Korea TJ 6,606 6,539 6,509
Energy intensity TJ / KRW 1M 0.0016 0.0018 0.0018
Renewable Energy Consumption4) Global MWh 306,316 741,480 878,569

1) Figures for energy consumption in Korea in 2022 have been revised based on the verification results of the Ministry of Environment.

2) Figures for energy consumption in Korea in 2023 may be revised in the future based on the verification results of the Ministry of Environment.

3) Energy Intensity = Global Energy Consumption / Revenues excluding LG Energy Solution, and Common and others. Figures for energy intensity in 2021 and 2022 have been partially revised due to the restatements reflecting discontinued operations.

4) Means of renewable energy procurement include green pricing, renewable energy certificates (solar, wind), and self-generation (solar).

Water Withdrawal, Consumption, and Discharge

We closely monitor and manage water usage at our sites every step of the way, from water withdrawal, through the manufacturing stage, which includes raw material processing and cooling, to the discharge of properly treated wastewater. As the importance of water management continues to increase due to growing water scarcity, we aim to identify and minimize water withdrawal and consumption in water-stressed areas, in particular.

"Category, Scope, Unit, 2021, 2022, 2023"
Water Resources Management Unit 2021 2022 2023
Water Withdrawal Total m3 78,063,643 74,781,261 73,423,047
Surface water m3 - - -
Groundwater m3 444,068 440,512 464,569
Seawater m3 - - -
Municipal water m3 77,597,935 74,326,951 72,813,032
Other1) m3 21,640 13,798 145,446
Water withdrawal intensity m3 / KRW 1M 3.2434 2.9400 3.5336
in regions with water stress m3 4,521,147 4,457,410 4,405,035
Wastewater Discharge Total m3 21,449,266 21,190,129 22,543,478
Water discharge intensity m3 / KRW 1M 0.8912 0.8831 1.0849
in regions with water stress m3 1,656,575 1,765,931 1,625,892
Water Consumption Total m3 56,614,377 53,591,133 50,879,569
Water consumption intensity m3 / KRW 1M 2.3522 2.1069 2.4486
in regions with water stress m3 2,864,572 2,691,479 2,779,143
Water Reuse Rate2) % 2.30 2.57 2.65

1) Other water sources include rainwater, etc.

2) Calculation of water reuse rate includes the amount of recycled water within the operation and purchased reclaimed wastewater.

"Category, Scope, Unit, 2021, 2022, 2023"
Water Resources Management (Yeosu, Daesan) Unit 2021 2022 2023
Yeosu Water withdrawal m3 50,420,936 48,143,272 43,611,260
Municipal water1) m3 50,420,936 48,143,272 43,611,260
Water consumption m3 40,209,460 38,272,526 32,254,609
Daesan Water withdrawal m3 14,130,202 13,096,040 17,462,242
Municipal water1) m3 14,130,202 13,096,040 17,462,242
Water consumption m3 8,611,123 7,967,640 12,039,271

1) Yeosu and Daesan plant source 100% of water through municipal water.

Water Pollutants Discharge

To return the water used during the manufacturing process back into the aquatic ecosystem, we track the sources and impacts of water pollutants and conduct regular inspections of wastewater discharge facilities.

"Category, Scope, Unit, 2021, 2022, 2023 "
Water Pollution Management Unit 2021 2022 2023
Water Pollutant Discharge COD1) Metric tons 589 472 244
Discharge intensity kg / KRW 1M 0.0245 0.0186 0.0117
TOC1) Metric tons 318 457 381
Discharge intensity kg / KRW 1M 0.0132 0.0179 0.0183
SS Metric tons 255 240 228
Discharge intensity kg / KRW 1M 0.0106 0.0094 0.0110
T-N Metric tons 273 211 211
Discharge intensity kg / KRW 1M 0.0113 0.0083 0.0102
T-P Metric tons 25 34 41
Discharge intensity kg / KRW 1M 0.0010 0.0013 0.0020

1) Reflects the gradual transition of reporting metrics from COD to TOC, under the Korean Water Environment Conservation Act.

Air Pollutant Emissions

We strictly comply with the emission standards for air pollutants emitted during the manufacturing process and conduct regular inspections of emission facilities to minimize air pollutant emissions.

"Category, Scope, Unit, 2021, 2022, 2023"
Air Pollution Management Unit 2021 2022 2023
Air Pollutant Emissions Dust Metric tons 167 183 176
Emission intensity kg / KRW 1M 0.0069 0.0072 0.0085
NOx Metric tons 4,134 3,823 3,150
Emission intensity kg / KRW 1M 0.1718 0.1503 0.1516
SOx Metric tons 184 240 119
Emission intensity kg / KRW 1M 0.0076 0.0094 0.0057
VOCs Metric tons 956 1,206 151
Emission intensity kg / KRW 1M 0.0397 0.0474 0.0073
HAPs Metric tons 273 298 105
Emission intensity kg / KRW 1M 0.0113 0.0117 0.0051
Waste Disposal and Recycling

We catalogue and manage the disposal of general waste and hazardous waste, and consider ways to minimize waste generation and maximize recycling by analyzing incineration and landfill wastes.

"Category, Scope, Unit, 2021, 2022, 2023"
Waste Management Unit 2021 2022 2023
Waste Generated Total Metric tons 278,345 279,585 248,036
Waste intensity kg / KRW 1M 0.0120 0.0114 0.0119
Nonhazardous Waste Total Metric tons 153,981 150,922 125,043
Recycling Metric tons 108,145 111,612 97,692
Incineration
(w/ heat recovery)
Metric tons 22,682 23,149 13,779
Incineration Metric tons 12,359 6,177 4,433
Landfill Metric tons 10,795 9,984 9,138
Other Metric tons - - -
Hazardous Waste Total Metric tons 124,364 128,663 122,994
Recycling Metric tons 53,961 60,374 57,458
Incineration
(w/ heat recovery)
Metric tons 53,407 54,361 52,210
Incineration Metric tons 15,501 12,862 11,930
Landfill Metric tons 1,495 1,066 1,395
Other Metric tons - - -
Waste Recycling Rate incl. Incineration
(w/ heat recovery)
% 86 89 89
excl. Incineration
(w/ heat recovery)
% 58 62 63
Zero Waste to Landfill (ZWTL) certifications1) Sites - 3 4

1) Gimcheon, Cheongju (Separator), Guangzhou, Quzhou.

Product Responsibility and Chemical Stewardship

We evaluate risks that may arise during the use, storage, and transportation of hazardous chemical substances, and continue our efforts to reduce the use of hazardous substances in our products. We also conduct Life Cycle Assessments (LCAs) to analyze the environmental impact of our products and identify areas for improvement.

"Category, Scope, Unit, 2021, 2022, 2023"
Hazardous Substances Management1) Unit 2021 2022 20232)
Proportion of sold products containing REACH3) Annex 17 substances % 16.10 9.69 20.46
Proportion of sold products containing REACH SVHCs4) substances % 1.57 2.47 4.85
Proportion of sold products containing CMR5) substances % 2.71 4.65 7.07
Hazardous chemicals risk assessment6) % 25.09 26.33 26.64

1) Calculated the proportion of products containing each substance relative to the number of products sold per year.

2) Proportion of products containing hazardous substances has increased with the addition of Annex 17, SVHCs, and CMR substances compared to 2022.

3) REACH: Registration, Evaluation, Authorization and Restriction of Chemicals.

4) SVHC: Substances of Very High Concern.

5) CMR: Carcinogenic, Mutagenic and Reprotoxic chemicals.

6) Proportion of substances that have completed or are exempt from substance registration among the constituent substances of the sold product.

Material Reuse and Recycle

We are developing various plastic recycling technologies, both mechanical and chemical, and plan to expand the production of recycled plastics.

"Category, Unit, 2021, 2022, 2023"
Reused/Recycled Materials Unit 2021 2022 2023
Proportion of Reused/Recycled Materials1) Input PC % 1.44 1.68 2.50
ABS2) % 0.02 0.12 0.19
PO2) % - 0.05 0.18
PVC2) % - - 0.0010
Plasticizers2) % - - 0.0019

1) Reused/Recycled Materials refer to Post-Consumer Recycled (PCR) or Post-Industrial Recycled(PIR) products. The proportion of reused/recycled input is the amount of PCR or PIR material input relative to the total material input.

2) Following the expansion of the recycled plastics business, the proportion of reused/recycled materials for ABS, PO, PVC, and Plasticizers products have been calculated in addition to PC products.

Employee and Process EH&S

As chemical manufacturing is exposed to heavy equipment, hazardous substances, and high temperatures and pressures, employee and process safety is of paramount importance. We have expanded the scope of our EH&S management to include not only our employees, but also in-house subcontractors, and have established an accident prevention system that goes above and beyond legal standards.

"Category, Scope, Unit, 2021, 2022, 2023"
Employee and Process EH&S Unit 2021 20221) 2023
Employees Fatality Rate2) Rate 0.0056 - -
TRIR3) Rate 0.7642 0.6079 0.8344
LTIR4) Rate 0.2454 0.0968 0.1597
Subcontractors Fatality Rate Rate - 0.0104 -
TRIR Rate 0.5078 1.1025 0.7816
LTIR Rate 0.2132 0.3640 0.1804
Process Safety5) PSE6) Event - 1 -
PSER7) Rate - 0.0035 -
Transport Incidents Road Event 1 1 -
Rail Event - - -
Ship Event - - -

1) From 2022 onward, the accident rate is calculated by applying actual hours worked.

2) Fatality Rate: Total number of fatality cases * 200,000 / total hours worked.

3) TRIR(Total Recordable Incident Rate): Total number of recordable incidents * 200,000 / total hours worked.

4) LTIR(Lost Time Incident Rate): Total number of lost time incidents * 200,000 / total hours worked.

5) Calculations for process safety events are based on the internal accident index standard which includes injuries, fires, leakages, amount of loss, etc.

6) PSE(Process Safety Events).

7) PSER(Process Safety Event Rate): Number of process safety events * 200,000 / total hours worked.

Diversity, Equity, and Inclusion

We identify the diversity of our employees by gender, age, and region in each job group and career level, and monitor the equity of remuneration. We also operate various training and mentoring programs designed to develop a culture that embraces gender, generational, cultural, and cognitive diversity.

"Category, Scope, Unit, 2021, 2022, 2023"
Diversity, Equity, and Inclusion1) Unit 2021 2022 2023
No. of Employees2) by Region Total Person 18,792 19,627 19,218
Korea Person 13,906 14,572 14,360
China Person 3,564 3,705 3,488
Asia-Pacific
(excl. China)
Person 627 578 513
Europe Person 419 471 479
Americas Person 276 301 378
No. of Executives3) Total Person 108 113 113
Male Person 100 103 105
Female Person 8 10 8
No. of Employees by Employment Contract (Korea) Non-fixed term Person 13,652 14,249 14,029
Fixed-term Person 254 323 331
No. of Employees by Gender (Korea) Male Person 11,729 12,356 12,088
Female Person 1,923 2,216 2,272
Ratio of female employees
(non-fixed term)
% 14 15 16
Ratio of female employees
(incl. fixed term)
% 14 15 16
No. of Employees by Age
(Korea, non-fixed term employees)
Under 30 Person 2,441 2,508 2,187
30 to 49 Person 8,655 9,110 9,275
50 or above Person 2,556 2,631 2,567
No. of Leaders in Revenue-related4) Departments (Korea) Male leaders5) Person 427 486 506
Female leaders Person 21 23 28
Ratio of female leaders % 5 5 5
No. of Employees in R&D6) Departments (Korea, non-fixed term) Male Person 1,821 2,004 2,030
Female Person 855 962 1,020
Ratio of female employees % 32 32 33
Social Minorities (Korea) Persons with disabilities Person 252 250 251
National Veterans Person 270 286 290
Gender Pay Gap7) Non-management level
(base salary)
% 77 80 84
Management8) level
(base salary)
% 94 94 95
Management level
(base salary + cash incentives)
% 94 94 95
Executive level
(base salary)
% 93 86 91
Parental Leave (Korea) Total number of employees due to return to work after taking parental leave Person 129 157 90
Male Person 46 60 41
Female Person 83 97 49
Total number of employees that did return to work after taking parental leave Person 129 157 84
Male Person 46 60 39
Female Person 83 97 45

1) Figures for 2021 and 2022 have been partially revised due to changes in the organizational boundaries and internal classification criteria.

2) Calculated based on the number of employees at the end of the fourth quarter of each year.

3) Executives refer to executive officers and registered directors at the Vice President level and above. Figures for 2021 and 2022 have been revised to reflect the criteria in the Business Report.

4) Revenue-related refers to departments directly related to goods and services, such as production, sales, etc.

5) Leaders refer to employees at the positions of team leader and above, excluding executives.

6) R&D refers to departments related to research & development, technology, etc.

7) Ratio of average female to male remuneration, calculated by dividing the average remuneration of all women in a position by the average compensation of all men in the same position. There are no distinctions based on gender, while factors such as years of service contribute to the pay gap.

8) Management refers to employees at the level of professionals/senior managers and above, excluding executives.

Talent Attraction, Training, and Employee Engagement

We recruit talented individuals from diverse backgrounds, based on their abilities and competencies. We provide everyone with a variety of growth opportunities to help them enhance their global competencies and leadership capabilities.

"Category, Scope, Unit, 2021, 2022, 2023"
Employee Hires Unit 2021 2022 2023
New Employee Hires Total Person 3,140 2,651 1,025
Korea Person 1,560 1,431 662
excl. Korea Person 1,580 1,220 363
New Employee Hires by Employment Contract (Korea) Non-fixed Person 1,330 1,261 922
Fixed-term Person 230 170 103
New Employee Hires by Gender (Korea) Male Person 1,255 1,070 466
Female Person 305 361 196
New Employee Hires by Age (Korea) Under 30 Person 759 849 409
30 to 49 Person 635 469 201
50 or above Person 166 113 52
"Category, Scope, Unit, 2021, 2022, 2023"
Employee Turnover Unit 2021 2022 2023
No. of Voluntary Turnover (Korea) Total Person 306 344 303
No. of Voluntary Turnover by Gender (Korea) Male Person 245 257 225
Female Person 61 87 78
No. of Voluntary Turnover by Age (Korea) Under 30 Person 133 161 100
30 to 49 Person 158 173 182
50 or above Person 15 10 21
"Category, Scope, Unit, 2021, 2022, 2023"
Training and Development Unit 2021 2022 2023
Training Hours (Korea, non-fixed term) Total Hour 567,604 506,803 373,011
Male Hour 449,714 412,266 300,215
Female Hour 117,890 94,537 72,796
Average training hours per employee Hour / Person 41.6 35.6 19.7
Mandatory Training Hours (Korea) Total Hour 69,170 95,990 62,048
Male Hour 57,675 86,004 56,723
Female Hour 11,496 9,986 5,325
Training Cost (Korea) Total KRW 10K 1,564,100 2,139,966 2,219,761
Average training cost per employee KRW 10K / Person 115 150 118
Labor and Human Rights

In line with the <LG Chem Global Human Rights & Labor Policy>, we conduct self-assessments and on-site inspections into workplace human rights impacts. To mitigate potential and actual human rights impacts, we continue to revise human rights policies and improve business processes.

"Category, Scope, Unit, 2021, 2022, 2023"
Labor and Human Rights Unit 2021 2022 2023
Labor Union (Korea) No. of employees eligible to join Person 7,337 7,447 6,799
No. of employees participating Person 5,436 5,410 5,279
Proportion of employees participating % 74 73 78
Collective Agreements (Korea) Proportion of employees covered % 100 100 100
Supply Chain Sustainability

To enhance supply chain sustainability, we conduct periodic risk assessments and provide capacity-building opportunities for our suppliers. We assess potential risk factors such as human rights, EH&S, and ethics through supplier self-assessments and on-site audits, and offer programs to suppliers to help improve ESG competencies

"Category, Scope, Unit, 2021, 2022, 2023"
Supply Chain Management Unit 2021 2022 2023
ESG Self-Assessment Total number of suppliers1) Company 1,262 1,433 1,168
Number of suppliers that have finished ESG self-assessment Company 232 762 1,000
Total number of core suppliers2) Company 240 178 118
Number of core suppliers that have finished ESG self-assessment Company 53 77 97
ESG On-site Audit Total number of high-risk suppliers3) Company 42 169 13
Number of high-risk suppliers that have finished ESG on-site audit Company - 17 6
Total number of high-risk core suppliers Company - 1 -
Number of high-risk core suppliers that have finished ESG on-site audit Company - - -
ESG On-site Audit Findings and Improvements Number of findings4) Case - - 142
Number of improvements Case - - -

1) Suppliers refer to domestic and overseas suppliers with records of annual purchase amounts of KRW 100M or more, and 3 or more purchase orders.

2) Core suppliers refer to suppliers in the top 90% of purchase amounts, and include companies of all sizes.

3) High-risk suppliers refer to suppliers who fall under a high-risk rating as a result of self-assessment or fall into the high-risk group due to findings of critical non-conformance items, etc.

4) The increase in the number of findings is attributed to on-site audits focused on ESG risk monitoring and inspection after the supplier training and support period (~2022).

Community Engagement

We strive to take care of the environment and safety around our operations, provide employment and local development opportunities to the community, and operate partnership programs to develop close relationships with the community.

"Category, Scope, Unit, 2021, 2022, 2023"
Social Contributions and Community Engagement Unit 2021 2022 2023
Social Contributions Total KRW 1M 16,194 21,725 16,884
Charitable donations KRW 1M 9,641 17,760 13,101
Community investments KRW 1M 6,071 3,852 3,730
Commercial initiatives KRW 1M 482 113 53
Employee Volunteer Activities Participation hours Hour 4,965 3,371 2,993
Corporate Governance

We uphold the fundamental values of expertise, independence, and transparency in the operations of the Board of Directors, and practice board-centered responsible management to ensure efficient and proactive governance.

Corporate Behavior and Ethics

We conduct regular inspections on corruption and bribery, and handle identified cases through internal disciplinary or legal procedures. We also provide training on ethics and fair trade practices to raise employee awareness and proactively manage risks.

"Category, Scope, Unit, 2021, 2022, 2023"
Ethics, Anti-Corruption, and Fair Trade Unit 2021 2022 2023
Corruption and Bribery No. of investigated cases Case 7 14 13
No. of handled cases Case 3 4 3
Unfair Trade Practices No. of legal investigations Case - - -
No. of legal actions Case - - -
Ethics Training No. of employees participating in ethics training1) Person 13,431 15,159 15,068
No. of employees participating in fair trade training2) Person 14,413 15,191 15,298

1) Includes contents on Jeong-Do management and the Code of Ethics.

2) Includes contents related to subcontractors and compliance.

Information Security and Cybersecurity

We conduct information security risk assessments based on our enterprise risk management and provide awareness-raising campaigns and training on information security and cybersecurity, to ensure the safe collection, use, and management of all information related to corporate operations.

"Category, Scope, Unit, 2021, 2022, 2023"
Information Security and Cybersecurity Unit 2021 2022 2023
ISO 27001 Certified business sites Site 4 16 16
Information Security Training Awareness raising activities Campaign 12 12 12
Average training hour per employee Minute / Person 30 30 10
Public Policy and Regulation

We actively seek out public-private partnerships by identifying policy issues and regulations that may affect our business. We pursue government proposals and participate in policy-making through our local and overseas public affairs networks.

"Category, Unit, 2021, 2022, 2023"
Public Policy and Regulation Unit 2021 2022 2023
Contributions to trade associations1) KRW 1M 2,223 2,497 3,076
Contributions to political campaigns2) KRW 1M - - -

1) In 2023, contributions have been made to the following top 5 organizations:

    - World Economic Forum (WEF): 437,400 (KRW 1K)

    - Korea Enterprises Federation (KEF): 331,082 (KRW 1K)

    - Korea Vinyl Environmental Council (KOVEC): 293,000 (KRW 1K)

    - Korea PC/BPA Council (KPBC): 291,471 (KRW 1K)

    - Korea Petrochemical Industry Association (KPIA): 236,761 (KRW 1K)

2) The Political Funds Act prohibits companies from sponsoring political organizations.

Tax Strategy

We recognize that observing the tax laws of each country in which we operate and fulfilling our duty to pay taxes faithfully as a taxpayer maximizes shareholder value and contributes to national finance. We comply with the following tax policies and extensively manage tax risks for sustainable management.

Tax Policy

LG Chem observes the following tax-related principles and regulations:

- Fulfill tax reporting and payment obligations faithfully in accordance with the relevant local laws.

- Maintain a transparent relationship with the tax authorities and faithfully observe the obligation to submit data requested by the local tax authorities.

- Implement a reasonable transfer pricing policy in line with tax laws and OECD transfer pricing guidelines for international transactions with overseas corporations.

- Establish an efficient tax management system that calculates the effective tax rate and identifies the taxpayer in each country following the introduction of digital tax.

- Prohibit the transfer of income to a tax haven for the purpose of tax evasion.

- Release the annual audit report and other information on the electronic disclosure system to provide transparent tax information.

Tax Risk Management

LG Chem practices the following tax risk management processes:

- Assess tax risks based on advice from external experts and tax authorities when making major business decisions.

- Report to the executives depending on the type and amount of the tax, and clearly define responsibilities and tasks related to tax reporting and payment.

- In the event of tax risks such as tax law-related uncertainties, resolve the risks by collaborating with external experts.

"Category, Scope, Unit, 2021, 2022, 2023"
Tax Reporting Unit 2021 2022 2023
Reported Taxes1) Total KRW 1M 1,235,790 641,482 432,501
Korea KRW 1M 672,683 747,539 5,387
Asia (excl. Korea) KRW 1M 565,833 389,245 424,168
Europe KRW 1M -61,505 186,016 66,978
Americas KRW 1M 2,421 4,141 20,589
Others KRW 1M 39 247 642
Consolidated adjustments KRW 1M 56,319 -685,706 -85,264
Cash payment of corporate tax KRW 1M 1,281,796 1,707,449 1,348,461

1) Based on the consolidated financial statements of FY 2023.

Sustainable Solutions

To provide superior social and environmental value in terms of sustainability, we have established the Sustainable Solution as an internal standard to check the sustainability contributions of our products and technologies based on six values: climate change, circular economy, water resources, product toxicity, biodiversity, and social value. By collating this information with stakeholder demands, we identify priority areas and increase investment to secure sustainability competitiveness at the product level.

"Category, Scope, Unit, 2021, 2022, 2023"
Economic Performances Unit 2021 2022 2023
Revenues1) Total KRW 1M 41,786,572 50,983,251 55,249,785
Petrochemicals KRW 1M 20,175,492 21,151,355 17,208,803
Advanced Materials2) KRW 1M 2,390,269 2,538,394 2,441,790
Life Sciences KRW 1M 690,346 849,289 1,128,075
LG Energy Solution KRW 1M 17,803,863 25,586,365 33,667,228
Common and others KRW 1M 726,602 857,848 803,889
Revenue excluding LG Energy Solution, and Common and others3) KRW 1M 23,256,107 24,539,038 20,778,668
R&D Expenses Total KRW 1M 710,071 869,634 1,007,779
Sustainable technology and product4) KRW 1M 90,250 143,604 178,401

1) Based on the consolidated financial statements of FY 2023.

2) Revenues for 2021 and 2022 have been restated reflecting discontinued operations.

3) Represents simple deductions of revenues of LG Energy Solution and Common and others from the total; Common and others include revenues of FarmHannong. This figure has been used to calculate the intensity of environmental performance data. For details, please refer to the notes to the consolidated financial statements.

4) Includes expenses for projects in the areas of bio materials, recycling, and carbon neutrality.

Customer Satisfaction

We prioritize customer-centric thinking across all our processes and deliver exceptional value to our customers, by enhancing customer satisfaction and integrating customer grievance management within our internal operations.

"Category, Scope, Unit, 2021, 2022, 2023"
Customer Satisfaction Unit 2021 2022 2023
Customer Satisfaction Survey Scope1) % 100 100 100
Score Score 79 84 84

1) Refers to the percentage of business divisions that have conducted customer satisfaction surveys. Since 2020, the Customer Value Innovation Team has been conducting customer satisfaction surveys for customers across all business divisions.