2021-2022 LG Innotek SR (Eng) - 220907

2021-2022
LG Innotek
Sustainability Report
African Forest Elephant,

an Endangered Species
Elephants play a very important role for
the ecosystem in terms of seed dispersal,
carbon cycle, and green space formation
and restoration, among others.
Threatened by the destruction of their
habitats and poaching, African Forest
Elephants are “Critically Endangered”,
the state immediately before extinction.
Recognizing the importance of
preserving the natural ecosystem,
LG Innotek pursues ESG activities
for a sustainable Earth.
About this Report
Contents
Overview of the Report

Overview Environmental
The LG Innotek Sustainability Report 2021-2022 is the Company’s 13th
sustainability report published since the first report in 2010. This Report 004 CEO’s Greetings 056 Resource Circulation
is a communication channel through which the Company’s sustainability 006 Messages from Our Executive 062 Eco-friendly Products and
activities and goals are transparently disclosed and shared with stake-
Members Technologies
holders. In the course of 2021, LG Innotek has been faithfully implementing
008 Corporate Profile
its ”Global No. 1 Material and Component Company” to Bring a Better
Tomorrow. We will continue efforts for growth and evolution into a cen- 012 ESG Management Vision and System
tennial company by strengthening ESG management. 016 ESG Performance Highlight
018 Stakeholder Communication Social
Reporting Standards
019 Materiality Analysis 064 Employees
This Report was created in accordance with the Core Options of the GRI
(Global Reporting Initiative). Under the industrial classification system 078 Supplier ESG
of the SASB (Sustainability Accounting Standards Board), it discloses 086 Social Contribution
information according to the recommended disclosures for the hardware
Focused Issues
sector of the Technology & Communications Industry where the Company
belongs. In addition, this Report contains information about the Company’s 024 Issue 1 Health and Safety
implementation of the Ten Principles of the UNGC (UN Global Compact) 030 Issue 2 Product Quality and Safety
and SDGs (Sustainable Development Goals) as a member of the UNGC. Governance
034 Issue 3 Carbon Neutrality
In particular, with respect to climate change, the TCFD (Task Force on 094 Enhancing Management
Climate-Related Financial Disclosures) guideline is reflected. Transparency
Reporting Scope 098 Shareholder-friendly Management
The scope of this Report includes performances of LG Innotek’s domestic Inquiries about This Report Customer Value Creation 100 Risk Management
and overseas worksites in each area of ESG on the basis of consolidated For further information or inquiries on this Report, 042 Customer Value
financial statements in accordance with the K-IFRS (Korea International please contact us using the information below.
Finance Reporting Standards). The reporting scope of some quantitative 050 R&D Innovation
data can vary, and the detailed reporting scope and boundaries were Appendix
ESG Planning Team, ESG Division, LG Innotek Co., Ltd.
footnoted.
7th Floor, E1/E3, 30, Magokjungang 10-ro, 112 Sustainability Pledge
Reporting Period Gangseo-gu, Seoul, Korea 114 Economic Data
This Report covers the period from January 1 through December 31, 2021 Homepage: www.lginnotek.com 116 ESG Data Sheet
(fiscal year). As for the key activities, information in the first half of 2022 Tel: +82-2-6987-2235
128 Independent Assurance Statement
is also disclosed. E-mail: sustainability@lginnotek.com
130 Sustainability Indices
Credibility of the Report This Report was published in interactive PDF format to enable 136 Memberships, Awards, and
readers to skip directly to the relevant pages and click related Certifications
This Report has been assured by the Korea Productivity Center, an inde-
web pages by offering the Reference Page, Video Play, and
pendent assurance agency, in terms of its compliance with the disclosure 144 Sustainability Reports History
Relevant Website functionalities.
principles of the GRI, TCFD, and SASB as well as selection and disclosure
of material issues, appropriateness of content, and data accuracy, etc. Table of Contents Video Play
The assurance was conducted according to the *AA100AS (2008) Type 1 in
Moderate Level. For specific indices requiring verification of the reliability
Print Reference Page
of the information collection process, Type 2 assurance was also applied.
In addition, this Report was assured with respect to its compliance with
the four principles of **AA1000AP (2018), which are inclusivity, materiality, Relevant Website
responsiveness, and impact. For the details of assurance, please refer to
the Independent Assurance Statement (p.128-129).
* AA1000AS (2008): The AA1000 Assurance Standard (2008) is a global assurance standard
established by Accountability that offers a methodology to report sustainability issues by
assessing the organizational operation, compliance with the principles, and reliability of
performance information in relation to the management performances of a business.
** AA1000AP (2018): The AA1000 Accountability Principles Standard (2018) is a set of global
assurance principles established by Accountability that serves as the basis for AA1000AS.
004 LG Innotek Sustainability Report 2021 - 2022 Overview Focused Issues Customer Value Creation Environmental Social Governance Appendix 005
CEO’s Greetings
Dear Stakeholders,
Please accept my gratitude for your support and encouragement over the past year.
In 2021, we were faced with a difficult management environment caused by the prolongation of the COVID-19 pandemic
and various issues in the global supply chain. Despite the circumstances, LG Innotek achieved record-high management
performance through the effort to provide differentiated customer value and improve profit structure.
For our Optics Solution and Substrate Business, we solidified our global No. 1 position by accelerating growth based on
the timely development of products needed by customers and preemptive investment expansion. As for the Automotive
Components Business, we are putting forth effort to dominate the autonomous driving solution and electric vehicle
market; for the Electronic Components business, we prepared a foundation for profitability improvement through
activities to improve the business structure centering on value-added products.
To achieve sustainable growth and development with stakeholders including customers, suppliers, and local communities,
instead of being content with current achievements, LG Innotek is committed to practicing substantial ESG management
by establishing the following ESG promotion strategies:
First, we will promote substantial ESG management that will lead to the creation of new business strategies and outcomes.
We will promote substantial ESG management by establishing ESG strategies which consider our business environment
and the characteristics of material/components business, and deriving tasks that can lead to improvement in our business
competitiveness and management outcomes.
Second, we will promote ESG management with a focus on key tasks based on choice and concentration and with
consideration given to our resources and capacities.
While performing a balance of activities in environmental, social, and governance areas, we will prioritize tasks within each
area according to the principles of importance and urgency and promote the tasks in phases.
In particular, we will preferentially promote climate change response, which is emerging as the most urgent and important
task. As part of the effort, in March 2022 we declared our goal of achieving net-zero carbon by 2040, and we are focusing our
organizational competencies on fulfilling this goal.
Third, we will strengthen our ESG management implementation power by internalizing the ESG organizational culture.
Beyond managing risk, ESG management is being recognized as an indispensable element of corporate competitiveness,
required for a company to be selected by customers. Accordingly, we will bolster our execution power for ESG activities
by establishing an ESG culture based on continued education and campaigns and reflecting ESG elements to key
decision-making processes and management activities.
At the same time, we will dedicate every effort to achieving the sustainable growth of our business, such as by increasing
corporate value based on qualitative growth, securing future growth engine through R&D innovation, and reinventing
the way we work based on DX (Digital Transformation) in order to solidify our position as an ESG leading company in the
materials and components industry.
Thank you.
July 2022
President & CEO Cheoldong Jeong
Messages from Our Executive Members
Chief Strategy Officer Inkyu Lee Executive Vice President

Industrial advancement and integration of AI and DX technologies have considerably shortened the
duration of competition.
In operating a business, we are facing a situation wherein we need to understand customers and
Head of Optics Solution Business Unit Hyuksoo Moon Executive Vice President achieve continuous innovation across the value chain from product planning to manufacturing and
sale. While resolving issues at hand by identifying customer pain points, LG Innotek will focus on
Based on differentiated DX competency and quality, the Optics Solution Business Unit has
providing customers with valuable experiences by defining core values for each customer group.
recorded the world’s largest share for ten years in a row in the market for camera modules
To this end, we will strive to realize customer-centric management to select customer experiences,
and 3D sensing modules applied to smartphones and automobiles. For the Optics Solution implement tasks in the direction of improving customer experiences, and receive feedbacks on our
Business, communication with stakeholders is more important than in any other business activities as experienced by customers.
units as it is considerably affected by domestic and overseas economic fluctuations, changes We will dedicate greater effort to emerging as the “Global No. 1 Material and Component Company”
in automotive safety criteria or communication standards, and changes in customer that brings only the best possible value to customers.
requirements, such as application of new components to create improved camera quality in
the level of DSLR.
Chief Technology Officer Minseok Kang Executive Vice President
In keeping with the increasing demand for our fulfillment of social responsibilities including
For a company, the competency to provide the values needed by customers at the right time is
the use of eco-friendly energy, the Optics Solution Business Unit is actively responding to
most important.
the demand by joining the RE100 initiative targeting to achieve 100% renewable energy
LG Innotek focuses on the R&D of core technologies for materials and components in order to
transition by 2023. We will also continue making effort to create an eco-friendly and ethical
provide customers swiftly with differentiated products they need. To lead the product/technology
worksite to ensure safe working environment and respect for workers’ human rights.
market, we have established a mid- to long-term company-wide technology roadmap to carry out
development and ensure that the results of prior development lead to the foundation of sustainable
growth. We are also promoting the discovery of future growth engines and expansion of our business
Head of Substrate and Material Business Unit Kildong Son Senior Vice President to new areas through active open innovation.
As part of this effort, we have raised technological investment funds in Korea and United States
The Substrate and Material Business Unit is continuously generating the highest business since last year; using the funds, we are investing in global startups with bright prospects to keep
outcomes based on strategic customer response and competitive manufacturing capabilities pace with the technological trend of metaverse, AR, autonomous driving, etc. LG Innotek will dedicate
based on leading technological competencies in the semiconductor and display substrate utmost effort to continuing technological innovation for customer value creation.
sector.
In particular, we are promoting the commencement and securing of a competitive edge

in the FC-BGA business through investment ahead of others in line with the continuous Chief Human Resource Officer Kisu Kim Senior Vice President
growth of the 5G, mobile, IT, and semiconductor markets. In addition, based on excellent
The organizational culture that LG Innotek pursues is a company whose members take pride in it.
R&D capabilities and technological power, we will keep our No. 1 position in the communication
We believe that, when employees feel proud of the company, they become passionate about their
semiconductor and display substrate market.
work and believe that they can innovate the customer experience by providing differentiated
Moreover, we will strive to become a sustainable Substrate and Material Business Unit by
value. Based on this, the company can produce outcomes and achieve growth beyond market
establishing a Business Continuity Management system (BCM) and operating workplaces
expectations; consequently, this leads to the greater pride of employees.
that prioritize safety and environment.
We will be able to accelerate the achievement of becoming the “Global No. 1 Material and Component
Company” when we fulfill our social responsibilities through this virtuous cycle. Accordingly,
LG Innotek seeks to perform “PRIDE” activities aimed at enhancing employees’ pride in the company.
Head of Automotive Components Business Unit Byaengkuk Yoo Vice President In 2022, we will further enhance employees’ pride by upgrading PRIDE activities from the
perspective of employee experience and deriving and implementing key tasks for change.
The Automotive Components & Electronics Business Unit is preemptively preparing for the
future of autonomous driving technology and electrification based on competitiveness for
customer value and securing differentiated future technology capabilities required in the
Chief Financial Officer Changtae Kim Senior Vice President
automotive electronic components industry. We are continuously securing advanced tech-
nologies including automotive radar and LiDAR as well as ultra-high-speed vehicle commu- LG Innotek established mid- to long-term goals and strategies based on a consensus with
nication, automotive motor controller, BMS (Battery Management System), DCDC converter, regard to the direction of ESG promotion and built an implementation system for ESG
and automotive LED lighting technologies that enable complete autonomous driving and Management by deriving the responsibilities and roles of the relevant organizations and
electrification. detailed tasks by area. In addition, we plan to encourage employees’ more active participation
by stably maintaining resource input in and enhancing employees’ understanding of the
We will secure a leading position in the ACE (Autonomous driving, Connectivity, Electrifica- ESG policy and programs. Based on the effort, we will produce substantial and sustainable
tion) sector, the core of the future mobility industry. We will engage in business operations outcomes by amplifying the driving force for implemented tasks. In particular, we will
preferentially to provide our customers with new values by promoting continuous techno- preferentially promote environment-related tasks, such as carbon reduction and recycling
logical innovation, building expertise and mass production capacities, and achieving digital of waste resources to solidify our position as an ESG leading company in the industry and
transformation. enhance employees’ pride.
Corporate Profile
Business Overview
Global Network
Since its establishment in 1970, LG Innotek has led technological Company Profile
development in the industry as a global materials and com-
ponents company. With focus on mobile, automotive, display, Date of Establishment August 22, 1970
semiconductor, and Internet of Things (IoT), we grow hand-in-
CEO Cheoldong Jeong
hand with our customers across broad business areas ranging
from materials and devices to components and modules. We Business Electrical and electronic components
established a network of nine production plants and eight sales
locations in major regions of Korea and abroad to tap into the Website www.lginnotek.com Wroclaw, Poland
Frankfurt, Germany Detroit, USA
global market while operating six R&D organizations in Korea
Tokyo, Japan San Jose, USA
to commit ourselves to developing innovative technologies and Yantai, China San Diego, USA
market-leading products. This has driven our continued growth, Shanghai, China
Shenzhen, China
with sales of KRW 14.9 trillion in 2021. Taipei, Taiwan
Haiphong, Vietnam San Juan Del Rio, Mexico
Despite the difficult management environment wherein the
demand of downstream industries is stagnant and competition
against other components makers is intensifying, we reorga-
Employees (Domestic) 12,415 Jakarta, Indonesia
[Korea]
nized our business structure to center on value-added items and Paju

Seoul
strengthened business portfolio management; thus achieving
sales growth and improving profitability. For the Optics Solution
Business, we solidified our position as the No. 1 partner of stra-
Sales KRW14.9 trillion
Ansan
Pyeongtaek
tegic customers for new technology-related cooperation; for

the Substrate and Material Business, we are maintaining stable
※ Based on2021 Annual Report
business competitiveness based on semiconductor substrates.
In addition, for the Automotive Components Business, we are Gumi
(Factory 1, 1A, 2, 3)
improving business structure by focusing on the development
Gwangju
of autonomous driving and electrification components. To
achieve sustainable growth, we are also actively searching for
new business opportunities in areas with bright prospects.
Key Business Units LG Innotek Product Overview Business Sites
Korea
Optics Solution Business Substrate and Material Business Automotive Components Business
Headquarters R&D Centers Factories
LG Innotek is a global market leader in LG Innotek is taking the initiative in With our automotive motors and sensors
· Magok, Seoul · Magok, Seoul · Gumi (Factory 1, 1A, 2, 3)
3D sensing modules, including ultra- technology innovation while supplying as well as communication, power, and
· Ansan · Paju
slim, high resolution camera modules semiconductor substrates, tape substrates, lighting solution modules contributing to
used for smartphones and tablets. We and photo masks, etc. applied to improving driving safety and convenience, · Pyeongtaek
are expanding our business presence smartphones, tablets, laptops, and LCD/ LG Innotek is increasing the order s · Gwangju
to automotive cameras, XR (Extended OLED TVs. primarily from global customers.
Reality), and other adjacent areas.
※ The electronic components business organization is established as a business division. Overseas
Sales (Unit: KRW 100 million) Sales Revenue by Business Unit (Unit: KRW 100 million) Production Subsidiaries Sales Subsidiaries/Branches/Offices
· Haiphong, Vietnam · USA: Sales subsidiary in San Jose, office in San Diego,
Optics Automotive · Yantai, China office in Detroit
Substrate and
2019 2020 2021 Solution Material Components Others · Jakarta, Indonesia · China: Sales subsidiary in Shanghai, office in Shenzhen
79,754 95,418 149,456 118,457 15,670 10,623 4,706

· Wroclaw, Poland · Taiwan: Sales subsidiary in Taipei
· San Juan Del Rio, Mexico · Japan: Sales branch in Tokyo
· Germany: Sales branch in Frankfurt
※ Based on 2021 Annual Report 2021

(Sales by business unit have been recalculated as Automotive Camera was transferred from Automotive Components Business Unit to Optics Solution
Business Unit as of 2022.)
Business Areas
Optics Solution Automotive Components
Camera Module Electrification Solution

A high-performance/multi-functional camera module that Power Modules, which are core parts of electric
maximizes user convenience by providing diverse functions vehicles, and motor solutions in various fields
ranging from high-definition photography to auto focusing, advanced with electrification technology
optical image stabilization, wide-angle photography, and
high-magnification optical zooming
Lighting Solution
3D Sensing Module A slim, flexible lighting module created with
A module extracting 3D Depth Maps by measuring the design and technolog y according to the
distance from a photographer to a specific object or location automotive lamp design trend and customer
requirements
Actuator
A dr i v in g comp onen t of fer in g zo omin g f unc t ion f or
Telephotography and OIS (Optical Image Stabilization) with Connectivity Solution
auto focusing to ensure precision focusing at camera module A vehicle communication component supporting
global coverage for safe autonomous driving
that enables vehicle-to-everything wireless data
Autonomous Driving Solution communication
A component for autonomous driving and passenger safety
and convenience to accurately recognize information in and
outside the vehicle through automotive cameras in diverse
lineups and radar-based sensors
Substrate and Material
Package Substrate FC-BGA

A high-density circuit substrate consisting A type of semiconductor substrate with
of fine patterns that is used to transmit high specifications and multiple layers
electrical signals between semiconductor applied to CPU/GPU for computers and
and main board, applied to all products servers, semiconductor for communication
using electricity devices and base stations, and SoC for
automotive components Electronic Components
Wi-Fi·Bluetooth Module Power Module

Photomask Tape Substrate A communication component that supports A power module component including PSU (Power
A microcircuit board engraved with A thin, film-t ype substrate on which Internet connection and data transmission Supply Unit) for LED/OLED TVs that supports the
patterns for selective light transmission display Drive ICs are mounted to connect through access to high-speed wireless stable operation of cutting-edge display products
applied to Flat Panel Display (LCD, OLED), the Panel with PCB communication networks
Printed Circuit Board (PCB), etc.
ESG Management Vision and System
ESG Management Vision ESG Promotion System and Organizational Structure

LG Innotek is committed to fulfilling its social responsibilities in a way that befits its status as the global No. 1 material and component LG Innotek set up the ESG Committee under the Board of Directors (BOD) in order to inspect ESG management execution and
company. We pursue sustainable development by increasing our corporate value while generating social value through ESG performances and ensure effective decision making for the mid- to long-term strategic direction. The Committee supports the
management. Company in achieving sustainable growth in the long run by fulfilling its environmental and social responsibilities and roles and
establishing transparent governance. The Committee resolves on major items related to the Company’s ESG management activities
In June 2021, we newly established our ESG management vision, “Global No. 1 Material and Component Company” to Bring a Better
and reports other matters to the BOD.
Tomorrow.
“Better Tomorrow” represents the future that LG Innotek seeks to create by building a healthier planet, developing a brighter and Chaired by the CFO, the ESG Executive Committee is an internal consultative body consisting of executives of the Company’s key
happier society, and realizing more transparent management. organizations as members. It strengthens the Company’s execution power for ESG activities by inspecting the status of key task
promotion and plans for each of the E, S, and G areas on a monthly basis. In 2022, with the goal of enhancing ESG Leadership, the
“Green Management for a Healthier Planet”, “Partnerships for Elevating Social Value”, and “Trustworthy Governance” embody the
scale of the consultative bodes was extended to include executives from ten divisions. The ESG Secretariat supports ESG strategy
strategic directions that we will follow in each of the ESG areas. We also selected ten implementation tasks and detailed improvement
development, risk management, stakeholder communication, and ESG internalization and competency building.
goals. Under the ESG vision, LG Innotek is committed to creating a sustainable society and becoming a centennial company.
ESG Committee (Subcommittees under the BOD) ESG Committee Activities
Composition CEO and three outside directors Date of Meeting Agenda Result
1st Meeting Appointment of Approved
Approve basic policies and strategies, etc. in 2021 the ESG Committee chairperson
Role
of ESG management (July 29, 2021) Report on ESG promotion Reported
Approve mid- to long-term ESG goals
status and plans
Oversee plans for ESG management activities
and performances 1st Meeting Report on ESG promotion plans Reported
in 2022 Approval of RE100 and Carbon Approved
Oversee ESG-related major risks
(February. 22, 2022) Neutrality promotion plans
Operation Semiannual meetings convened/hosted
Establishment April 29, 2021
※ The number of outside directors changed from four to three due to the
resignation of outside director Yeongchang Ju in May 2022
Global No. 1 Material ESG Executive Committee

and Component Company
CFO (Chairperson)
to Bring a Better Tomorrow.
ESG Division (Secretariat)
E S S S S S G G G G
Environ- Labor and Safety and Suppliers’ Social Information Governance Shareholder- Risk Corporate
mental Human Health ESG Contribution Security and centeredness Management Ethics
Rights Compliance
Management
Safety& People Care Safety& Procurement Business Information Legal Finance ESG Business
Environment Division, Environment Division Support Security Affairs Division Division Audit
Division People Division Division Division Office Division
Development
Division
ESG Capacity Building

ESG Management Awards and Certifications
ESG Risk Management
In accordance with the Code of Conduct of the Responsible Business Alliance (RBA), LG Innotek annually inspects the areas of
labor and human rights, safety and health, environment, and ethics in domestic and overseas worksites and makes the necessary
improvements on any issues brought forth. In May 2022, we conducted self-assessment at four domestic production worksites
(Gumi, Paju, Pyeongtaek, and Gwangju) and five overseas production subsidiaries (Vietnam, China, Indonesia, Poland, and Mexico).
No serious risks were found through the assessment, and progress is currently being made on the improvement items identified.
ESG Management Internalization Dow Jones Sustainability Index (DJSI) EcoVadis Sustainability Rating (2021)
Yearbook Member (2021, 2022) Platinum Medal
“A better tomorrow”, the goal of sustainable management, can be realized only with the consensus and participation of all employees.
Listed on DJSI Korea Index (2021)
Therefore, LG Innotek actively promotes ESG internalization activities to ensure that all employees understand the concept and
necessity of ESG management and apply it to their individual duties. As an ESG internalization activity, we have been providing an-
nual ESG Training to employees since 2013. In 2021, we started an online course focused on the concept, vision system, and ten key
tasks of ESG management. Since the first quarter of 2022, we have been issuing ESG Insight to share the ESG management trend
and outcomes of our ESG activities in order to enhance employees’ understanding of and interest in ESG management. We are also
holding ESG campaigns, such as refraining from using paper cups, reducing paper use, and activating donation through a social
contribution portal, with a goal of providing our employees with an opportunity to participate in ESG activities.
Korea Corporate Governance Service (KCGS) “ESG Company of the Year”

ESG Ratings (2021) by Maeil Business News
ESG Training Program and GREENFUND (2021)
ESG Integration Environmental Social Governance
Top prize in the Electronic Components category
A A A+ A
Number of
Target (Minister of Environment Award)
Target Persons
Domestic office workers 4,640
Employees Completed
Completion Rate
ESG training Course
3,827 82%
CDP Climate Change Korea Awards (2021) Business Integrity Society (BIS)
Carbon Management Sector Honors Summit (2022)
Best Company in Water Management Excellent Anti-corruption Company
ESG Campaign
* No Paper Cup Challenge * Paper Saving Campaign
* Environmental Protection * Employees’ Participation

Campaign on in Earth Hour Campaign
“World Environment Day”
ESG Performance Highlight
Social
Environmental
Employees_Human
Energy Intensity Rights Assessments Suppliers
(energy cost/production
Assessment Target Shared Growth Funds
amount)*100
for Suppliers
0.58% 14,437persons
KRW 64.5 billion executed
Participation Rate (KRW 103 billion raised)
Y-o-Y Energy Intensity Waste Recycling
Reduction by 100 % Win-Win Growth Index
40% Domestic
88.5% Employees
Rated Most Excellent
for Five Consecutive Years
GHG Emissions Overseas Job Competency Selected as Best Honorary Company
Development
Economy Scope 1+2 88.3% Learning Contents
367,099 tCO eq Local Communities
15,800
2
Sales Social Contribution Investment

GHG Emissions Intensity Environmental
KRW 14.9 trillion 4.17billion
2.46 tCO eq
KRW
2
Investments In-house Professional Governance
/KRW 100 million KRW 21.4 billion Instructor Approx.
Beneficiaries of Social
Operating Profit 180 persons Contribution Programs
Strengthened Role of the BOD
· Separated the BOD Chairperson
KRW 1,264.2 billion 18,258persons from CEO
· Appointed
Amount of Support to female outside director
R&D Investments Local Communities Contributors
KRW 564.2billion KRW 4.45billion Cash Dividends
KRW 71billion
Recognized as
Local Community Contributors
Cash Dividend per Share
Magok, Gumi, Gwangju, and Increased by
Pyeongtaek Worksites
4.3times
(KRW 700 → KRW 3,000)
Stakeholder Communication Materiality Analysis
Communication Channels LG Innotek conducted a materiality analysis to prioritize the sustainability issues identified from internal and external stakeholders
and selected the core issues.
Stakeholder Communication Detailed information on LG Innotek’s mid- to long-term plans, goals, and performances in relation to the material issues is available
Stakeholder communication is gaining greater importance in sustainability management. LG Innotek’s stakeholders are defined in the following “Focused Issues.”
as those who exchange a wide range of ESG-wise values with the Company and either affect—or are affected—by the Company’s
management. Our key stakeholder groups are customers, employees, shareholders and investors, suppliers, governments, industry Materiality Analysis Process ● Environmental ● Social ● Governance
players, NGOs, professional institutions, and local communities where we are based. We clearly recognize the importance of stake-
holder communication and strive to communicate candidly with each stakeholder group by using communication channels specialized Slightly Important Moderately Important Very Important Extremely Important
to them.
● Environmental protection ● Environmental investment ● Hazardous substance management Focused Issues
● Water resource management ●E co-friendly products and ● Human rights protection ● Carbon neutrality
Communication Channels ● Diversity and inclusiveness technologies ● R ● Health and safety
External stakeholder interest

ecruitment and retention of
● Energy management
● L ocal community human resources
●P
roduct quality
LG Innotek operates a number of communication channels to understand and respond swiftly to stakeholders’ interests. We actively ● Climate change response ●S ustainable management of suppliers
communication/contribution and safety
respond to questions and requests from stakeholders such as customers and investors about our ESG management system and ● L abor-management ● Waste management ● Customer satisfaction management
activities. In addition, stakeholders’ needs are identified through the annual stakeholder survey, and the results are reflected to the cooperation ● Human resources development ● Corporate risk management
● Shareholder rights
sustainability report. ● Organizational culture ● Corporate ethics
● Tax strategy ● Social value creation through R&D
We also check the legislative status in each country and the trends of key ESG-related research and assessment agencies in real time
● Information security system
through media research. At the same time, internal improvement is promoted based on the information collected through activities ● Corporate governance
performed as a member of international initiatives (joint consultative bodies) including the UN Global Compact.
While enhancing the reliability of LG Innotek by transparently delivering our news to stakeholders through the website, YouTube channel,
Impact on the Company
press report, etc., we share ESG promotion activities with employees using the in-house communication channels (INNO.LIFE) and
Intranet. We have other channels for regular communication with external stakeholders through which we collect their opinions.
Organize pool of material issues
Key Communication Channels and Methods for Collecting Stakeholder Opinions We selected 26 sustainability issues. These issues were derived through a comprehensive analysis on not only the
macroscopic economic conditions, environmental, social, and governance situations surrounding the materials and
Stakeholder Group Communication Channels Methods for Collecting Opinions Step 1 components industry and us and our business but also the degree of impact of our business on external stakeholders.
Customers In addition, we analyzed the importance of each selected issue in accordance with the global standards, ESG guidelines,
Exhibitions, customer satisfaction surveys, Facebook Customer satisfaction surveys,
and key ESG assessments and made reference to the activities, outcomes, and material issues of global ESG leading
website (Voice of Customers)
companies and materials and components industry.
Customer Pain Point System
Employees Open communication, CEO live (meeting), Satisfaction surveys, Survey stakeholders
labor-management council, in-house communication online whistle blowing channel, We conducted a questionnaire survey and consequently collected opinions from ESG industry experts and stakeholders
channel (INNO.LIFE), online whistle blowing channel report through Intranet at major contact points as to which issues, we must preferentially take into consideration in order to grow into a sustain-
Step 2
able company. A total of 1,018 persons (827 employees and 191 external stakeholders) participated in the survey. The
Shareholders General shareholder meetings, IR events survey target included various stakeholder groups, such as employees, customers, suppliers, investors, academic circle,
and public disclosures (annual reports), IR events press, governments, and NGOs. The participants responded to 26 questions on an importance scale of five points.
Investors
Materiality
Suppliers Sustainability Partners’ day, shared growth camp, Prioritize material issues
analysis Partners’ Day,
report, online whistle blowing channel The 26 issues selected for the pool of material issues were analyzed in terms of stakeholder interest, which was identified
surveys and online whistle blowing channel
website Step 3 through the stakeholder survey, and impact on the Company and categorized into four materiality levels (Extremely Import-
interviews
ant, Very Important, Moderately Important, and Slightly Important). While the prioritization of the issues was based on the
Government Proposing policy/regulatory improvements and participating Policy trend/media research stakeholder survey result, we also took into consideration the latest global trend and the direction of our ESG strategies.
in the relevant consultations, cooperation programs,
discussion meetings Select Extremely Important issues
Through the process above, carbon neutrality, health and safety, and product quality and safety were selected as
Industry Players, Participating in associations and societies, Media research, Step 4 Extremely Important issues. Among the material issues selected last year, identifying market-leading products and
NGOs, Professional joint collaboration programs, participating in conferences participation in associations recruiting key talent became general issues, and carbon neutrality and product quality and safety were newly selected
Institutions and societies as extremely important issues.
Local Communities Social contribution activities, sisterhood ties, Media research
local community meetings
Key Fluctuations in the Materiality Analysis Result
LG Innotek’s sustainable management policy has been restructured into the ESG policy according to the stakeholder and social in-
terest. To this end, the material Issue Pool (26 issues) was organized with consideration given to the environmental, social, and gov-
ernance factors as well as business risk management and relevance. General financial and economic issues, such as identification of
growth drivers and product competitiveness, have been excluded as well. For details on the financial and economic risk management,
please refer to the annual report.
The 26 key ESG issues selected for the ESG Issue Pool 2022 were categorized in terms of impact on supply chain, risk types, and impact with external factors, such as competition, customer demand, supply chain, technological innovation, and brand value.
stakeholder relevance. Operational risks are the risks caused by the absence and malfunction, etc. of the company’s management process and systems.
These risks include various factors such as internal and external regulations, human capital, governance, and security issues. Lastly,
Divided into the impact in the process of procurement of raw materials, in the process of production and manufacturing at
Hazard risks are the risks caused by natural disasters, terrorism, and other environmental factors that can do harm on the company
worksites, and in the process of sale, use, and disposal of products following shipment, the impact on the supply chain is used as a
and stakeholders. With hazard risks, the degree of impact can be reduced although avoidance of the risks is difficult.
tool for defining the scope of management for each issue.
As for stakeholder relevance, which indicates relevance between individual issues and key shareholder groups, the impact is analyzed,
As for the risk types, the issues were categorized into four types: financial, strategic, operational, and hazard risks. Financial risks
and the result is reflected in management activities with consideration given to interaction by issue.
are the risks that can affect cash liquidity and corporate financial performances, and which can also be affected by interest rate,
foreign currency exchange, credit rating, etc. Strategic risks are the risks arising from fluctuations in market situations that exchange
Category Impact on the Supply Chain Risk Type Stakeholder Relevance
Area Issue Upstream Operation Downstream Financial Strategic Operational Hazard Customers Employees Suppliers Local Shareholders
(procurement) (production/manufacturing) (sale/use/disposal) Communities and Investors
Focused Health and Safety ✓ ✓ ● ● ● ● ●

Issues
Product quality and safety ✓ ✓ ● ● ● ●
Carbon neutrality ✓ ✓ ✓ ● ● ● ● ● ● ● ●
Environmental Hazardous substance management ✓ ✓ ✓ ● ● ● ● ● ●
Environmental investment ✓ ● ● ●
Eco-friendly products and technologies ✓ ✓ ✓ ● ● ●
Energy management ✓ ✓ ✓ ● ● ● ●
Waste management ✓ ● ●
Environmental protection ✓ ● ●
Water resource management ✓ ● ●
Social Human rights protection ✓ ✓ ● ● ● ● ●
Recruitment and retention of

✓ ● ● ●
human resources
Sustainable management of suppliers ✓ ✓ ● ● ● ●
Human resources development ✓ ● ●
Organizational culture ✓ ● ●
Diversity and inclusiveness ✓ ● ●
✓ ✓
Local community communication/
● ● ●
contribution
Labor-management cooperation ✓ ● ●
Governance Customer satisfaction management ✓ ✓ ● ●
Corporate risk management ✓ ✓ ✓ ● ● ● ● ● ● ● ●
Corporate ethics ✓ ✓ ✓ ● ● ●
Social value creation through R&D ✓ ✓ ● ● ●
Information security system ✓ ✓ ✓ ● ● ● ● ●
Corporate governance ✓ ● ●
Tax strategy ✓ ● ● ● ●
Shareholder rights ✓ ● ● ●
Focused
Issues Issue 1 Issue 2 Issue 3
Health and Safety Product Quality Carbon Neutrality
and Safety
ISSUE 1
Health and Safety

Health and Safety Vision/Performance
Vision
Global No. 1 health and safety company by establishing
self-initiated safety and health management system
Under the motto “We Never Compromise on Safety”, all employees of Voluntary practice and continuous improvement (PDCA)
Management
LG Innotek place the highest importance on safety and strive to create System
Plan Do
a safe workplace by internalizing the safety culture. In 2022, we will
· Policy, strategic goal, plan · Resource input, R&R definition
perform accident prevention activities including safety training and · Risk assessment · Education and training
·C ompliance with laws, regulations, · Communication
emergency training, while revising the health and safety management
and requirements Plan · Participation and consultation
regulations and conducting risk assessment in order to establish an
Plan Do
self-initiated safety and health management system to promote
Action Check · C
employees’ self-initiated safe work practices. Through these activities, ase investigation and
· Performance management recurrence prevention
employees’ execution capabilities will be strengthened, and our safety · Management review · I nspection and monitoring
culture will be enhanced. on execution
· Internal audit
Action Check
Health and Safety R&R

Role and
Responsibility Employees Management supervisors General managers
Comply with health and Fulfill responsibility to prevent Promote effective implemen-
safety regulations and exposure to risks of employees tation of the organization’s
fulfill responsibilities working in the field health and safety goals
Executives/Divisions Top management

Systematically implement health and Fulfill responsibility for
safety management system the organization’s health and safety
Key Performances (2021)
Certified as Excellent Laboratory Selected as Excellent Company Established smart CCTV system
in Safety Management in Workers’ Health Improvement (detecting signs of fire)
(Ministry of Science and ICT) (Korea Occupational
Safety & Health Agency)
Gumi, Pyeongtaek, and
Pyeongtaek worksite Gwangju worksite Gwangju worksites
Employee LTIFR (Unit: %) Worker Injury Rate (Unit: %)
2019 2020 2021 2019 2020 2021
0.232 0.317 0.217 0.047 0.077 0.061

※ LTIFR (Lost Time Injury Frequency Rate): ※ Injury Rate: Percentage of workers injured against
Percentage of lost work time measured per total number of workers
one million work hours
Safety Management System

Health and Safety Standard Health and Safety Management System Safety Environment Operational Meeting Safety Rules for Visitors
LG Innotek strives to achieve its health and safety goals by LG Innotek is establishing and managing health and safety strat- Led by the CEO, LG Innotek strengthens execution capabilities For the safety of worksite visitors, LG Innotek provides a video
establishing a safety culture standard system based on the egies by establishing an organization dedicated to health and by making safety and environment-related decisions and in- on safety rules for visitors by reflecting the characteristics of
*EESH Manual and removing risk factors and minimizing risks safety management. In addition, while developing and imple- specting key tasks. hazards in each worksite. All visitors are required to watch the
under the system. menting health and safety management plans by worksite, we video prior to coming to the worksites to experience indirectly
* EESH: Energy, Environment, Safety, Health are strengthening the roles and responsibilities of employees EESH (Energy, Environment, Safety, Health) Council the possible risk scenarios within the worksites and develop
according to the health and safety management system. The division in charge of health and safety management and basic understanding on the safety guidelines for the respec-
Safety and Health Standard System other related divisions prepare company-wide solutions for tive situations.
health and safety issues on a quarterly basis and seek directions
Company-wide Divisions in Charge of
to strengthen health and safety improvement capabilities.
Organization Health and Safety
Highest-
Standard Safety Day
EESH Manual Company-wide
CEO organization in charge of Under the leadership of the executive in charge, LG Innotek
health and safety identifies risk factors by production process, derives improve-
ment tasks, and enhances the quality of health and safety
management.
Higher Health and Fire Chemicals Worksite management Health and safety
Safety Prevention Management (chief) officers managers in worksites Category Cycle Remarks
Regulations
Management Management Regulations Heads of business units, Quarterly Health and safety
Regulations Regulations CTO, heads of R&D centers management (Chief) officer
* Safety Rules Video for Visitors
Organizational Persons in charge of Heads of business divisions, Monthly
management health and safety production divisions, and
Supervisors by team (EESH Key Man) subsidiaries Safety Keeper
Lower “Safety Keeper” is an Intranet portal and an in-house chan-
Guidelines Safety Work Fire MSDS nel through which employees can check and communicate
Permit Prevention Management All workers
Guidelines Management Guidelines about health and safety-related information. It consists of
(including suppliers)
Guidelines Safety Issue, which provides information on accidents and
their prevention measures, Health and Safety Q&A, which
allows employees to ask questions about health and safety
Safety Culture Activity System anonymously, and Safety Man, which introduces effective
Operation of the Safety and Health Consultative Bodies
safety improvement activities. Health and safety-related
LG Innotek performs safety culture activities in three direc-
Occupational Safety and Health Council information includes Best Practices on safety, work safe-
tions: self-initiated safety management, safety system inter-
LG Innotek’s Occupational Safety and Health Council delib- t y, information on chemicals, health information, and
nalization, and strengthening of professional capabilities. * Safety Day Field Inspection
erates and resolves on important matters concerning occu- related laws and regulations.
Self-initiated · Develop self-initiated safety management pational safety, work environment, and health. Consisting of
Safety promotion activities and perform them the same number of persons from labor and management in-
Safety Culture Internalization
Management by division cluding the representatives of each, the Council, by convening
·S trengthen suppliers’ safety management by LG Innotek’s Safety Culture Internalization
meetings at least quarterly, contributes to accident prevention
improving the work permit process
and health and safety improvement. Health and Safety Leadership Training
· Strengthen smart monitoring
LG Innotek provided leadership training in a total of 30 sessions
· Strengthen health and safety execution power Items for Deliberation and Resolution
Safety System to 683 persons, such as those of senior management, managers,
Internalization by working class 1. M
atters concerning the establishment of industrial accident
and on-site supervisors, in order to enhance their awareness of
· Revise the safety and health management prevention plans
the roles and responsibilities for health and safety management
regulations 2. Matters concerning the establishment and revision of health and
(clarify R&R of management, managers, and safety management regulations and strengthen health and safety-related competencies.
supervisors) 3. Matters concerning workers’ health and safety education Program Target Completion (person)
· Improve the integrated safety system 4. Matters concerning work environment inspection and improve- Health and Safety Leader- Executives, heads of 52
(near miss registration system) and expand ment, such as work environment measurement ship for Senior Management divisions (including CEO)
risk identification
5. Matters concerning workers’ health management, such as health Health and Safety Leader- Heads of offices and 220
Strengthening · Provide training for professional examination ship for Managers teams
of Professional competency building 6. M
atters concerning the investigation of the causes of industrial acci- Health and Safety Leader- Heads of units and 411
Capabilities (accident investigation expert course, dents and establishment of measures to prevent accident recurrence
ship for On-site Supervisors groups EESH Key Man
ISO 45001 course) 7. M
atters concerning the recording and maintenance of industrial
Specialization of Persons in Person in charge of 32
· Introduce a safety culture quantitative assess- accident-related statistics
Charge of Health and Safety health and safety
ment system and derive improvement tasks 8. Matters concerning inspection on the conformance of health and
Accident Investigation Person in charge of 69
through assessment and analysis safety-related protective equipment upon equipment purchase * Safety Newsletter in the Safety Keeper Portal
Experts health and safety
Health and Safety Support for Suppliers Infectious Disease (COVID-19) Control
Health and Safety Win-win Cooperation Program To respond to COVID-19 and prevent the spread of disease, LG Innotek has switched to an emergency response system across do-
Smoking Cessation Program
mestic and overseas worksites.
LG Innotek develops and implements health and safety activity plans For employees wishing to quit smoking, LG Innotek offers a
by organizing the Win-win Cooperation Team in order to resolve the smoking cessation program at least once a year through coop- COVID-19 Status Management and Prevention Management of Employees on Business Trips Abroad
safety gap of suppliers and achieve shared growth with them. eration with medical institutions. Employees who succeed in in Relation to COVID-19
By holding monthly meetings with suppliers, we share health and smoking cessation are presented with gifts.
Monitor confirmed cases and workers’ health
safety best practices and accident prevention ideas, spread risk 1
Weight Control Program conditions Provide a disease prevention KIT before departure
assessment technologies, and assist our suppliers in detecting 1
(medicine, face mask, thermometer, etc.)
and taking appropriate actions against risk factors in their work For employees wishing to be on a weight control program,
areas. LG Innotek provides healthy meal plans and healthcare support. Prepare detailed guidelines according to the national
2
criteria and share the guidelines with all employees
Provide medical support service abroad during the
Healthcare Services Provided (Unit: Person)
Operating Equipment Permit System for Suppliers business trip
2
LG Innotek operates the equipment permit system in order to pre- Category 2019 2020 2021 Support disease prevention items such as face (In case infection is confirmed, provide daily
3
vent accidents caused by suppliers’ unsafe equipment use. The target masks, detection kits, and hand sanitizers monitoring and online medical support, etc.)
Health Management Center 20,699 15,185 17,631
of this system includes fire-related equipment (welding machine,
Health Checkup 15,366 17,508 22,384
etc.), electrical equipment (grinder, etc.), and chemical containers. Post information on daily confirmed cases and
Health Promotion Activities 3,094 1,062 796 4 Support accommodations during the quarantine
The certificate of permit is valid for two months from issuance. disease prevention rules, etc. 3
period after the business trip
Upon expiration of the permit, safety inspection is reconducted. ※ Domestic
5 Execute disease control in worksites
Safety Training
and Upgrading Safety Management Quality Work Environment Management
Personnel who have secured professional capabilities through
Hazard Exposure Assessment and
safety-related advanced training and assessment handle safety Special Case Establishment of Serious Accident Response System
Work Environment Management
management operations. In addition, all outsiders accessing
worksites are required to receive online program on the safety LG Innotek conducts hazard exposure assessment twice a year
To prevent serious accidents, LG Innotek established the self-initiated health and safety management system and improved the im-
rules and Eight Life Rules before entry. Those who have not to understand the conditions in the work environment where
plementation management process. We are establishing a health and safety management system to enable periodic self-inspec-
completed the program are strictly prohibited from entering chemicals are handled and identify the impact of hazard fac- tion, assessment, and improvement while helping all employees faithfully fulfill their health and safety duties.
worksites to ensure thorough safety management. tors caused by employees’ exposure to chemicals. By applying
Assessment and
internal criteria that are 50% stricter than the legal standard,
Health Management System

improvement
we strive to prevent the exposure of our employees to chemical Leadership of the management
7 Regularly assess and improve
substances. Leadership of the CEO the management system
and establish principles 1
LG Innotek ensures that all employees work in a safe, healthy
Health and Safety Training
work environment by conducting regular health inspections. In
addition to health improvement in worksites, we provide health LG Innotek provides health and safety training to all employ- ecure the safety of
S
examination, smoking cessation, and weight control programs to ees and suppliers. Regular safety training is provided to plant suppliers
6
assist in employees’ health improvement. At the same time, we workers for at least 2 hours a month, office workers for at least Secure the health and safety
have established a system for occupational and infectious dis- 1 hour a month, and managers and supervisors for at least 16 Identifying risk factors Key Elements of of all workers in Worksites
ease control and prevention. hours a year. Discover risk factors 2 Response to
in work Environment the Serious Accidents
Musculoskeletal Risk Investigation
Employees’ Health Management Punishment Act stablishing an
E
LG Innotek conducts musculoskeletal risk investigation and emergency action plan
LG Innotek provides health examination service for employees’
controls related symptoms displayed by workers with consid- 5 Prepare procedures for
health improvement and disease prevention. Based on the
eration given to the intensity and duration of works that bur- response to unexpected
examination results, health improvement programs are imple-
den the musculoskeletal system. Managing risk factors risk Situations
mented to offer appropriate healthcare and consulting services.
Prepare plans for risk factors 3
(removal, substitution, control, etc.) Workers’ participation
Health · General Checkup: All employees (once a year) 4
Checkup · Special Checkup: Employees exposed to hazard Ensure that all employees
factors freely suggest Opinions
· Comprehensive Checkup: All employees and their
spouses (once a year)
* All employees and their spouses aged 35 years and
older (once a year)
Employees aged 35 years and older who have worked
continuously for at least five years (twice a year)
Health · Smoking · Health Management Center

Improvement cessation program · In-house sports facilities
· Weight
control program
ISSUE 2
Product Quality and Safety

Quality Management System
In order to achieve “Global No. 1 Quality”, LG Innotek will further improve the quality control
system from the stage of development to mass production based on a Customer-Oriented quality
management system, professional capabilities in quality area, and No. 1 quality culture complying with
the principles, basics, and promises made to customers.
Since 2021, LG Innotek has been strengthening quality control by
establishing the complete quality control system to “We do not
accept, manufacture, nor ship nonconforming products.” and Mission Deliver impressive quality to customers
stabilizing quality in the early stage of mass production in each by following the principles and basics and keeping promises made to customers,
thereby achieving Zero defect, Zero quality accident, and Zero loss
stage of receiving, production, and shipping, such as guaranteeing
the quality of key components, designing and implementing quality
inspection. In 2022, we will further improve the quality management
system so that quality becomes the core competitiveness of our Vision Global No. 1 Quality
business by expanding the scope of quality control to include
suppliers and customers.
Upgrading
Quality
Management System
Custom n Qua
y er s uctio lity
alit ati prod co
n qu sfa as
s nt
ro
g m
l (r
cti
si
o
de
rt
on
ec
sfe
eiv
uct
Tran
ing/
Prod
production/ship
Development Mass Production
Quality Quality
Qua
pin
Co
lity
mp
g)
y
im
lit
en ro
on
ua
q ve
p
tq n me n
ua
lity sig nt atio
s de Quality opti
miz
Proces
Quality Professional No. 1

Management System Capabilities Quality Culture
Quality Management Internalization Quality Risk Management Hazardous Substance Management
Quality Management System In October 2021, the independence of the quality organization LG Innotek established the hazardous substance management Eco-friendly Supply Chain Management
To innovate the customer experience, a process to be applied was strengthened through the integration of the quality con- system in conformity to international standards (RoHS, ELV, To secure the hazardous substance management levels of sup-
across the LG Group is being developed based on the excel- trol teams of each business unit into the Quality Management REACH) and customers’ policy on the restriction of hazardous pliers, LG Innotek regularly provides training on hazardous
lent operation processes of LG Group affiliates. An additional Center under the direct management of the CEO. Under the substances, classifying regulated substances into banned and substance management to persons in charge at the suppliers.
process customized to LG Innotek is also being developed. The real-time reporting system for all quality issues, quality issues monitored substances to ensure that these substances are not
are inspected prior to their occurrence, and potential risks are We have also introduced the eco-friendly certification system
processes will be opened by the fourth quarter of 2022. We used for production. The scope of the system application has
preemptively managed. The horizontal implementation of the Green Program to assess whether a supplier’s hazardous sub-
plan to establish a Closed Loop Quality System wherein all qual- been expanded to the components and packaging materials.
ity data from development to mass production are connected system across business units is also being expanded in order stance management system complies with the environment-re-
We supply only eco-friendly products to customers by assess- lated statutes and meets our requirements. We transact only with
for management. To apply the new system swiftly to our busi- to prevent the occurrence of similar issues in other worksites
ing the inclusion of hazardous substances in the components suppliers that are found to be complying with the Green Pro-
ness and improve employees’ understanding of the system, through follow-up review (Reflection) and preventive action
from the stage of receiving and preparing the necessary gram through verification.
we are providing educational programs for using the system (Lessons Learned).
improvement measures. For all materials received into our
by establishing a separate organization.
worksites, we conduct hazardous substance screening and
Enhancing Professional Capabilities Quality Management of Suppliers precision inspections.
Quality control in the entire process from the initial stage of de- The data on hazardous substances concerning all components
LG Innotek supports education and training and system
velopment to mass production requires professional knowledge and packaging materials are integrated for management
internalization activities to strengthen the quality control ca-
and experiences. LG Innotek selected FMEA (Failure Mode and through an IT system. When a supplier uploads data about a
pabilities of suppliers; thus ultimately achieving customers’
Effect Analysis), reliability test, data science, precision analysis, component in the hazardous substance management system,
satisfaction with quality. In 2022, we supported the establish-
and response to regulations for hazardous substances in prod- the status of regulation is searched and checked. Then, the
ment of the quality management system in five suppliers by
ucts as the five core capabilities for strengthening customer information is shared with the development, procurement,
using our statistical process management system. In addition,
quality, and it secures quality expertise by establishing a quality production, manufacturing, and marketing organizations.
professional training on basic statistics and statistical process
expert fostering system.
management was provided to 76 persons of 9 companies. We
No.1 Quality Culture plan to expand supplier supporting activities continuously to

Hazardous Substance Inspection in Value Chain
provide educational and system establishment support.
LG Innotek is creating a culture of solving problems by im-
proving processes and systems in a way that ensures that all Design Approval Mass Production Shipping
At the same time, we strengthened the supplier certification
employees follow the basics and principles and Speak up about Eco-friendly Component Component receiving Product shipping
process for key components by publishing the LG Innotek
the irrationality risks so as to prevent the recurrence of the product design qualification inspection inspection, production verification/inspection
same issues. While communicating with each division through Statement of Requirement (SOR) and also established the model verificationt
the Quality Management Center, we perform innovation activ- quality control process by dividing the component life cycle
ities to internalize the quality culture by conducting question- into nine stages from production to discontinuation. More- Develop- · Design products that meet · Request the development of
over, we conduct Re-PPAP (Product Parts Approval Process) to ment the customer’s hazardous components that meet the
naire surveys and interviewing employees. In the first half of
substance policy hazardous substances design
2022, we provided the Quality Mind training through an online monitor and improve the quality control levels of Automotive
criteria
channel. We will continue performing activities to internalize Components suppliers following the stage of PPAP.
and establish the No. 1 quality culture. Procure- · Share criteria for the ·Secure components that · Request hazardous substance
ment management of hazardous comply with the hazardous analysis reports and
Product Reliability Assessment substances in products with substance criteria whose appli- information on the properties
Quality Mind Training Status (Unit: Person)
suppliers cation is requested of raw materials to suppliers
LG Innotek established a six-stage reliability assessment pro- · Register suppliers that meet the
Target Persons Trainees Attendance Rate
cess to assess product performance and stability according to hazardous substance manage-
5,381 5,120 95% ment criteria
customer requirements. Following robust design in the initial
※ Targeting all office and plant workers and field managers development stage through short-term stress test, we assess Quality ·E stablish hazardous · Approve requested · Conduct receiving inspection · Ship product after checking
product performances and functions as required by customers substance management components by inspecting on mass production compliance with the customer’s
for each product and in each process design stage. In addition criteria and inspect and whether they meet the components, test the hazardous substance policy
Awards for Quality Control operate related systems respective hazardous sub- components for the inclusion · Conduct sampling test on
to life test considering the user environment and ORT (Ongoing
· Inspect whether product has stance criteria of hazardous substances shipped products for inclusion
Reliability Test) under stress and acceleration conditions for been designed according to · A ssess and improve suppliers’ of hazardous substances
GM (General Motors) Supplier Quality Excellence Award
(2017-2021) the early detection of defects in each production lot, quality the customer’s policy for hazardous substance
reliability is regularly assessed according to changes in mass hazardous substance management system
Regulations
Jaguar Land Rover JLRQ (Jaguar and Land rover production components and processes. Having established
Quality) Award (2020-2021) the Reliability Technology Team in the second half of 2021, we
Manu- · Inspect whether components
are promoting the advancement of the reliability assessment facturing that meet the hazardous
Mando Supplier of the Year (2021) system through the dedicated organization. substance design criteria
are used
Thyssenkrupp Steering Strategic Supplier Award (2021)
BYD Company Supplier with Quality Excellence

(2021)
ISSUE 3
Carbon Neutrality
Carbon Neutrality Vision and Operating System
LG Innotek developed strategies for carbon neutrality in order to demonstrate

leadership as an ESG management leading company and respond to the global
issue of climate crisis.
In February 2022, the ESG Committee resolved on the 2040 Carbon Neutrality
promotion plan. Accordingly, we decided to promote 100% renewable electricity 2040 Carbon Neutrality
transition by 2030—which accounts for over 90% of the company-wide
greenhouse gas (GHG) emissions—with renewable energy. Under the slogan
WE SAVE
“We save the EARTH”, all employees of LG Innotek will actively participate in THE EARTH
achieving carbon neutrality.
Eliminate Aware Replace Trust Hear

Eliminate CO2 Be Aware of the Replace with Gain Trust by Hear what the
emissions & importance of eco-friendly energy disclosing our market,
environmental saving Earth and and production activities customers, and
pollution be part of such activities transparently Earth say
Carbon Neutrality Goal
2022 2030 2040

Carbon Neutrality Renewable Electricity
Carbon Neutrality
Fulfillment Rate Transition Rate
20 % 100 % Net Zero

Climate Change Response

Climate Change Governance Transition to Renewable Electricity International Certifications, Awards, and Cooperation
LG Innotek aims to achieve 100% transition to renewable elec- CDP Award for Climate Change Response
LG Innotek reports climate change response strategies and progress at the monthly ESG Executive Committee meetings and semi-
annual ESG Committee meetings. At the ESG Committee meeting held in February 2022, an item about carbon neutrality and RE100 tricity used in all worksites by 2030. The amount of renewable LG Innotek was awarded the “Carbon Management IT Sector
(100% transition to renewable electricity) was passed. electricity power supplied through Green Premium in 2021 Honors” in the IT category of climate change response assess-
was 41 GW (gigawatt), which is equivalent to the amount of ment for three years in a row at the 2021 CDP Korea Climate
electricity used by approximately 14,000 households in a year. Change Response and Water Management Awards” organized
Greenhouse Gas (GHG) Management
by *CDP (Carbon Disclosure Project) Korea.
The amount of GHG emissions from LG Innotek’s domestic and overseas worksites in 2021 was 367,099 tCO2eq (GHG converted into We will expand renewable energy use in our overseas pro-
* CDP is a nonprofit organization assessing the management information
CO2 emissions), and 92% of the emissions were generated by electricity use. Although our sales in 2021 increased by 57% year on year, duction facilities as well including the Vietnamese subsidiary.
of approximately 13,000 global businesses in relation to their response to
GHG intensity decreased by 33% from the previous year as a result of our GHG reduction activities, such as introducing high-efficiency To this end, we are reviewing the introduction of photovoltaic environmental issues, such as climate change, water, and forest resources.
facilities and improving the efficiency of UT operation. In accordance with international standards such as ISO 14064-1 (international power generation facilities while actively making use of systems
standard on GHG inventory establishment and quality management), we disclose and continuously manage GHG emissions and energy offered in each country, such as “Power Purchase Agreement
consumptions through third-party verification. (PPA)” to purchase power directly from power generation com-
panies using renewable energy, and purchase of certificate for
renewable energy use.
Distribution of GHG Emission Sources GHG Emissions (Unit: tCO2eq)
Our worksites are also making various efforts to increase the
GHG Intensity (tCO2eq/KRW 100 million)
rate of renewable energy use. In the Paju worksite, a photovol-
■ Scope 1 ■ Scope 2
taic power generation system was introduced for lighting at
4.95 3.67 night; in the Gumi worksite, a solar power heating system was
Electricity 92% 2.46 established to supply heating and hot water to the dormitory.
In the Magok worksite, renewable energy is used through
394,990
photovoltaic power generation facilities.
371,231 367,099
350,061 353,120 The Gumi worksite in particular has been recycling steam gen-
Steam 4% 335,024 erated from waste incineration since 2012. By using waste
Joint Declaration of 2050 Carbon Neutrality
heat instead of LNG, the Gumi worksite is producing the effect
by the Electrical and Electronics Industry Carbon
of not only lowering GHG emissions but also reducing energy Neutrality Committee
cost by KRW 900 million a year. Gumi worksites 2 and 3 are In March 2021, eight of Korea’s leading electrical and electron-
realizing energy savings of KRW 300 million a year through the ics companies, such as LG Innotek as well as LG Electronics,
LNG 3% establishment of a steam network. LG Energy Solution, Samsung Electronics, and Samsung Elec-
tro-Mechanics, announced the “Joint Declaration of Carbon
Neutrality in Electronics, Electrical, and Battery Industries
Responding to Climate Change by Converting Business by 2050.” Through the declaration, LG Innotek expressed the
Process Gases,
etc.
1% 23,759 Vehicles into Electric Vehicles (Participation in K-EV100) commitment to joining actively in the effort for carbon neutral-
15,044 ity and pledged to build an organic cooperative relationship
13,979 As part of the effort for achieving carbon neutrality, LG Innotek, with other participating companies. We will discuss various
※ Based on 2021 2019 2020 2021 through participation in the K-EV100 (a Korean model to ways to accelerate and promote jointly the fulfillment of the
achieve 100% transition to electric vehicles), will convert all common goal of carbon neutrality based on communication
※ GHG Emissions can vary from the figures in the annual report according to the result of vehicles owned and leased by the company into electric vehi- and cooperation.
the government’s conformity assessment and due to decimal rounding. cles by 2030. In preparation for the increased electric vehicle
· Scope 1: Direct emissions (fuel combustion, emissions from process, mobile combustion)
distribution, we are expanding electric vehicle charging infra-
· Scope 2: Indirect emissions (electricity, steam)
structure installation in worksites across the country.
Saving Energy Resources

Over 90% of GHG emissions from LG Innotek are generated by electricity use. Therefore, energy saving and efficiency improvement Energy Management Process Establishing a Predictive Maintenance System for
are an indispensable element in achieving carbon neutrality. To reduce energy cost while minimizing the environmental impact, Stable Energy Supply
LG Innotek established the energy management system (ISO
LG Innotek is continuously reviewing and managing plans to optimize the Energy Mix by monitoring the policy trend related to
50001) in 2012 and developed energy strategies, managed Stable energy supply is a prerequisite for energy saving.
fossil fuel use and decarbonization and predicting market situations including energy demand.
targets, and inspected risks under the system. We are perform- Accordingly, LG Innotek is focusing on achieving stable energy
Mid- to Long-term Vision of Energy Management ing energy-saving activities according to the PDCA (Plan, Do, supply through real-time demand monitoring and prediction
Check, Action) cycle throughout the process from preliminary by applying DX (Digital Transformation) technologies to the
Mission energy reviews to energy supply and use. Each year, the re- existing monitoring and control system. In 2021, we applied
Become the global No. 1 UT and energy leader by creating a stable production environment
sults of our activities are reported to the management, and the the predictive maintenance system for electrical facilities to
and enhancing customer value through high-quality, high-efficiency energy supply
level of the activities is improved. all power substation facilities in Korea for real-time analysis to
Vision In addition, we have established a company-wide monitoring detect anomalies and also established an inspection system for
Global No. 1 UT & Energy Leader
system for energy intensity performance, and we provide in- motors as a key management target in mechanical facilities.
Target Zero UT Accident 100% Energy Efficiency 100% Transition to Renewable Energy formation on the status of our energy management.
Equipment Innovation
Establishment of predictive Comprehensive energy Transition to
maintenance system management renewable energy use Energy Management Process To achieve the energy-saving goal, old facilities have been
replaced, and energy efficiency-improving facilities have been
Energy Policy ·E
stablish the direction of energy introduced. In addition, energy-efficient facilities are selected
Establishment saving promotion by worksite, and efficiency of facilities is improved through
Energy Reduction Performance and Goal
functional analysis.
Energy Intensity (Unit: %) Energy Reduction Effect (Unit: KRW 100 million) High-efficiency Equipment Application
In the Gumi worksite, high-efficiency facilities such as high-
Energy Planning · Evaluate the energy risks efficiency freezers and non-purge dryers have been intro-
54 53
2021 Domestic 52 · Assess major energy sources duced to improve energy efficiency. In addition, through
1.15
0.95
0.71 · Establish energy-saving goals
preliminary evaluations, energy efficiency is systematically
managed from the stage of equipment introduction.
0.58 2021 Overseas
0.33 Equipment Optimization

Execution and · Improve inefficient facilities
LG Innotek lowers the air supply pressure, optimizes clean
Operation · Invest in energy saving room spaces and conditions, and implements stricter man-
· Introduce high-efficiency facilities agement of idle equipment to optimize energy supply and
2021 Goal 0.86 % consumption; thus creating a waste-free work environment.
(34% Reduction vs Goal) In particular, we are improving the air supply logic to discon-
2019 2020 2021 2019 2020 2021
·C
onduct monitoring, measuring, tinue energy consumption while equipment is idle, thereby
Inspection and
※ Energy intensity = (Energy supply cost/production amount)*100 Handling Action and analysis reducing cost.
· Conduct internal and external audits
· T ake corrective actions on nonconformities Energy Saving by All
Energy Consumptions in 2021 (Company-wide) (Unit: MWh) In 2021, the Gumi worksite participated in the voluntary ener-
gy efficiency target program of the Korea Energy Agency and To reduce energy cost additionally, all employees of LG Innotek
Non-renewable Renewable propose energy-saving ideas and perform improvement activ-
Activity Total set the energy intensity improvement goal to 2.1% from the
Energy Source Energy Source Management · Review activities
previous year. It overachieved the goal by recording a 26.6% ities in the field. In 2021, approximately 1,640 energy-saving
Consumption of fuel 58,150 - 58,150 Review · Set directions for future activities
improvement. With the accomplishment recognized through plans were proposed.
(excluding feedstock) · Review and report management activities
an independent verification by an external expert, the Gumi At the same time, based on the consensus to practice carbon
Consumption of 727,492 - 727,492
worksite was selected as High-efficiency Plant in August 2021. reduction and energy saving in everyday life, we wage an envi-
purchased or acquired
electricity ronmental protection campaign participated in by all employees.
Consumption of 4,324 - 4,324
heat (hot water)
Consumption of 62,127 54,011 116,138
steam
Consumption of - 246 246
self-generated non-fuel
renewable energy
Total energy 852,093 54,257 906,350 * High-efficiency Plant Certification (2021)
consumption
Customer Value Creation
Business and R&D
Environmental Analysis
In 2021, as the impact of COVID-19 was eased and major countries lifted their lockdown
policy, demand showed a gradual recovery trend. Although the recovery trend is expected
to be heightened in 2022 as quarantine measures are further relaxed, economic uncertainty
is amplifying due to the situation between Russia and Ukraine, monetary tightening,
economic stagnation in China, etc. In addition, the frequent supply disruptions such as
for raw materials, logistics, and semiconductor are expected to pose a risk to our busi-
ness growth.
Meanwhile, in the era of technological hegemony, the establishment of an innovative Key Performances (2021)
ecosystem to lead technological innovation is forecast to accelerate. Accordingly, materials
and components companies need to respond preemptively to the situation by establishing Business Outcomes
a strategic technological development system to secure advanced technologies and global For the Optics Solution Business, the scale of sales was expanded and business competitiveness was strengthened as we
value chain in major countries. released new premium products such as Triple Camera and 3D sensing module and secured cost competitiveness. As for
the Substrate and Material Business, we improved the business structure to center on value-added products such as high-
Mid- to Long-term Strategic Direction
frequency communication substrate, for the Automotive Components Business, we recorded sales of over KRW 1 trillion based
Business Strategy on differentiated products and technologies.
LG Innotek will accelerate the growth of key businesses by expanding the scale of semi-
conductor substrate business and generating profit for the Automotive Components
Sales Increase in the Optics Solution Business Unit
R&D Investment
Business, while solidifying the No. 1 position of the Optics Solution Business by improving
68 %
relationships with strategic customers. In addition, we will create customer value and lead R&D Investment Amount (Unit: KRW 100 million)
the market by actively discovering and developing technological competitiveness and By
next-generation growth engines. y-o-y 2019 5,036
Marketing Strategy 2020 4,742

Based on source technologies accumulated for over 50 years, LG Innotek is actively Sales Increase in Semiconductor Substrate
responding to the changing market trend and customer needs. Under the goal of “Becoming 2021 5,642
a Reliable Partner for Our Customer’s Business Success”, we are advancing to the Global
No. 1 Material and Component Company by establishing the customer value innovation
By 56%
system, etc. y-o-y
R&D Investment Ratio (Unit: %)
In addition, we are building customized management systems across all areas including
not only marketing but also R&D, production, and quality control.
2019 2020 2021
While securing a basis for our growth by expanding partnerships with key global customers, Sales Increase in the Automotive Components Business Unit
we are striving to provide diverse experiences to our customers through meticulous mar-
ket analysis.
By 17% 6.3 5.0 3.8
y-o-y ※ I n 2021, although R&D investment increased compared to the previous year,
R&D Strategy R&D investment ratio decreased owing to the higher rate of sales increase.
Based on the company-wide Technology Road Map (TRM), LG Innotek is planning and imple-
menting tasks aligned with the business areas. We are also promoting the establishment
of a culture of boldly taking on challenges; thus discovering base technologies for the future.
In addition, through transition to DX-based R&D, we are promoting innovative changes
in the way we work.
Customer Value
Customer Value Creation System Marketing Advancement

LG Innotek’s pipeline system serves to manage systematically the entire domain of business operations ranging from seizing new
market and customer sales opportunities to developing and mass-producing products. Using the system, we are upgrading the
data-based marketing activities and strengthening capabilities to receive orders through process innovation. We are raising the bar
LG Innotek’s Customer Value Innovation Framework
on our marketing management performance so that new opportunities and outcomes identified from all our marketing activities
are visualized and translated into final orders and sales.
3 Innovation at Customer Contact Points At the same time, we are carrying out advanced customer-centric marketing activities by creating a virtuous cycle of customer
experience innovation to enable our customers to experience changes in the process of selecting and purchasing our products.
Outside-In
To this end, we are defining core value elements through connection to the customer environment and market; thus identifying and
implementing improvement tasks. Our educational program designed to consider the characteristics of B2B customers also helps
Reliable Partner for Our Customer's our marketers build stronger competency. LG Innotek will work to push beyond the simple fulfillment of customer needs to present
Business Success differentiated value and customer-centric solutions to build long-term partnerships with customers.
1 Proactive Identification of Pain Points 2 Reactive Identification of Pain Points
Global No. 1 Material and
Component Company
Pipeline System
Inside-Out
Lead Sales Opportunity Delivery Sales
4 Process Improvement and Innovation
5 Organizational Competency/Culture and DX Innovation
Identify internal standards and Check customer needs for Deliver and sell
information to understand products and solutions that can be products and solutions
1 Proactive Identification of Pain Points 4 Process Improvement and Innovation
customer needs/interests provided by the Company
Create a database of market and technology trends to Accelerate process improvement and innovation on
identify new business/product opportunities to deliver product planning, processing, and quality assurance
differentiated future value to customers to build competency as the Global No. 1 Material and
Pipeline stage
Component Company
2 Reactive Identification of Pain Points
Collect, share, and manage all VOCs (voice of customers) 5 Organizational Competency/Culture and DX Innovation Lead Access Proposal Spec-In / Project-In Award Closing
generated across the value chain to provide fundamental Clearly understand the shifting technology landscape
TQRDCM* values that form the basis of business conduct in the digital era and build stronger digital competency
to reinvent work methods and corporate culture
3 Innovation at Customer Contact Points
Securing/Discovering Proposing customized Product sampling and mass Order management
Establish the basis for Outside-In sensing to build stron- * TQRDCM: The six basic elements of business, which are Technology,
Quality, Responsiveness, Delivery, Cost, and Management. business opportunities solutions production certification
ger global customer service capabilities
Customized Marketing Activities to Understand Customer Pain Points and for Customer Satisfaction Assessment System Establishment of Customer Communication
LG Innotek is strengthening SCM (Supply Chain Management) Improvement With the goal of “Strengthening Execution Capabilities for Infrastructure System
sensing capabilities for stable product supply in the post- Customer Experience Innovation”, LG Innotek is assessing Since 2016, LG Innotek has been operating the pain point
In 2021, LG Innotek strengthened customer responsiveness
COVID-19 era. customer satisfaction in 2022 according to the virtuous cycle
system to manage customers’ diverse requirements system-
of customer experience innovation (goal establishment →
by establishing the “Pain Point Completion System”, which
covers the process from pain point collection and analysis to atically. In 2022, we visualized customer requirements using
LG Innotek is solidifying partnerships with customers by pro- improvement → monitoring). We list key customer experiences
improvement, feedback, and follow-up management. The the pain point system and shared the data in real time with the
viding differentiated technologies and products that meet using the core value maps for each customer group and survey
channel for organizations at customer contact points has management.
customer needs at the right time based on thorough analysis customer satisfaction by developing questions based on the
been expanded to include not only the existing marketing but
of the market and competitors. We are also collecting and an- list. The assessment is conducted targeting our key customers, We are also expanding the collection of VOS (voice of suppliers) in
also development and quality divisions. In addition, through
alyzing customer pain points by operating a division in charge and the assessment target will be expanded continuously. addition to customer pain points. By doing so, we can identify
a weekly meeting of the management, we share the status of
of customer value innovation and strengthening activities at Result of Customer Satisfaction Assessment and suggest solutions to the difficulties and problems expe-
pain point collection and follow-up action; thus strengthening (Unit: Point)
customer contact points to respond swiftly to customer needs. rienced by our raw material and component suppliers and
our execution capabilities. 2019 2020 2021
4.1
outsourcing suppliers, which in turn will lead to our customer
In 2022, as part of the effort to create a virtuous cycle for 4.2 4.2 experience innovation.
customer experience innovation, we will focus on resolving
※ The assessment during the period 2019-2020 was based on a scale of
customer pain points by preparing core value maps for each
100 points. In 2021, however, it was changed to a five-point scale, so the
customer group. figures were converted accordingly.
Customer Contact Activities

In 2021, LG Innotek established a digital marketing organization in order to respond to the rapidly changing digital environment Strengthening the Digital Marketing Platform
and expand customer contact points to provide differentiated customer experience. With the new organization, we diversified dig-
Official Website Official Website LinkedIn
ital communication channels for marketing competitiveness improvement and brand development and improved content competi-
tiveness. The LG Innotek website is not only a content hub providing By operating a channel in LinkedIn, a global B2B social platform,
various kinds of information ranging from information about LG Innotek is providing content on various subjects ranging
Strengthening Marketing Content Competitiveness the Company to that on products, latest technologies, and ESG from technology trend (industry and company's latest tech-
to customers and stakeholders but also a channel for commu- nologies) to products(new products, new businesses), people
Newsletter (LG Innotek Insights) Strengthening Video Content Production to Deliver nication with customers. We will strengthen customer com- (employees), and ESG management to strengthen communi-
LG Innotek publishes a number of technical articles and white Customer Value munication by providing various contents. At the same time, cation with both new and existing customers.
papers as well as regular newsletters (LG Innotek Insights) To support marketing promotion activities and improve brand we will offer differentiated customer experience by creating a
that introduce technological trends based on customer needs, image, LG Innotek delivers differentiated values by producing Virtual Showroom where customers can experience our prod-
industry trends, and features and strengths of the Company’s video content introducing the Company’s products and technol- ucts and future technologies.
key products and technologies. Through the global SNS ogies and other themed videos.
channels, these publications are being used for the new Lead
creation campaign to discover potential customers and
strengthen relationships with existing customers.
* LG Innotek Website
Social Channel Operation

* LG Innotek Insights * Videos by Theme (Digital Twin) In line with the trend of contactless and online communica-
tion, LG Innotek operates a number of social network channels
to communicate closely with customers, investors, and other
Mid- to Long-term Road Map of Digital Marketing stakeholders.
Newsroom (Blog) * LG Innotek LinkedIn Page
2021 2022 2023 The LG Innotek Newsroom is a blog-format online channel

Establish Digital Marketing Upgrade Platform Strengthen Data-based where new press releases and feature news on the latest IT
Infrastructure Campaign Discover Potential YouTube
and Build Data trends, among others, can be found.
Customers
LG Innotek operates an official YouTube channel to deliver sto-
The content is curated to help even those with novice-level
2. Channel ries about the Company’s growth and challenges taken over
1. Content knowledge easily understand materials, components, and in-
Strengthen digital platform the years as well as business competitiveness and organiza-
Build content strategy formation technology and view the various hosted events for
competitiveness tional culture to a wide range of users, such as future talents,
4. Activation Create New Business visitors.
Deploy campaigns to Opportunities customers, and other stakeholders.
discover Lead
3. Marketing Automation Tools Facebook
Establish/Stabilize/Activate marketing automation tools
Strengthen The LG Innotek Facebook channel focuses on communicating
Relationship with young generation and discovering future talents. Using
with Existing this channel, we communicate with stakeholders on various
5. Database Customers
Acquire new Lead/MQL (Marketing Qualified Lead)/SQL (Sales Qualified Lead) subjects including organizational culture, recruitment infor-
mation, and product and technology information.
DX (Digital Transformation) Management Establishing the Foundation for DX

As defined by LG Innotek, DX refers to all activities of creating value from data and aims to enhance customer value through these
The transition from analog to digital has brought about numerous changes in customers and corporate activities. LG Innotek’s key
activities. Recognizing that improvement tasks that could not be attempted in the past are not implementable according to the ad-
customers are communicating with end customers by creating products and services in their own ways. In this process, they both
vancement of digital technologies, LG Innotek clarified the direction and effects of DX activities.
demand swift and accurate response from suppliers and expect differentiated service to understand customer pain points and pro-
vide solutions accordingly.
Operating a number of production bases overseas, LG Innotek must secure the same level of manufacturing competitiveness for Direction of DX Activities
both domestic and overseas worksites. We also need solutions to address business continuity risks arising from trade disputes and
Effects Improve speed (lead time) and accuracy (prediction, simulation) using data and digital technologies
problems in the global supply of components, etc. To this end, we are making various efforts to apply DX in direct and indirect areas
of our business to ensure our corporate survival and business continuity.
Speed Accuracy
(speed improvement) All data are (dispersion improvement)
expressed with
DX Management Framework/Road Map median values
and dispersion
DX Promotion Road Map 5 10
Results Technical
2020 Current level 2023 2025 Expanding improvement areas
Digital difficulty
Maturity
Digital Introduction Digital Basic Digital Maturity Digital Leader
Establishing the Foundation Implement Data-driven Become the Digital Leader

DX Framework
for DX Management in the Industry
Speed accuracy
Reducing improvement time → increasing frequency

Strategy Establish the direction and Secure data based on the needs Create a Dream Factory
strategies for DX promotion for use ·E
stablish a fully intelligent factory
· Inspect the DX level, · Establish DX tasks and a data and promote global concurrent
derive key areas for application road map engineering
· Establish the promotion system · Establish 14 value chains by stage · Discover DX-based new businesses
and a road map DX Value Creation Systematic Diagram
Operation Improve the DX execution power Create outcomes for Foster strategic business partners Enhance Customer Value
DX Goal
· Operate the DX Committee DX implementation for DX
Internal value (growth of sales/profits)
led by the CEO · Promote A2D (Analog to Digital)/
· Promote three key tasks informatization
→ Switch to Intelligence tasks
Effect
(using Smart Factory, Digital Twin, Product value up Efficiency up (output/input)
and Data Operation) · Establish and standardize
performance creation criteria
Improvement Speed and accuracy improvement
Result
Core Strengthen the DX organization Establish the DX ecosystem Establish a digital organizational (customer response, product proposal in advance, tact time reduction, zero human error)
Capabilities culture/capabilities · Internalize key DX technologies culture
· Conduct activities to enhance · Promote a global concurrent and Digital
· Achieve DX Open Innovation
Technologies AI / Big Data Simulation IoT / sensor
awareness (customers, suppliers) connected information system
· Introduce the DX and · Execute DX operations completed Robot Cloud
*RPA certification system by team
Data
Structured Semi-structured Unstructured
* RPA: Robotic Process Automation
DX Operation and Execution DX Core Competency

Operating the Company-wide DX Committee Enhancing DX Awareness
Three DX Core Tasks
To strengthen the DX execution power, LG Innotek holds DX To enhance employees’ awareness of DX effectively, LG Innotek collects employees’ opinions, reflects them when creating promotional
Committee meetings led by the CEO and attended by exec- content, and distributes the content; Best Practices Letter, Educational Video, DX Promotional Materials, etc.
Digital Twin Smart Factory
utives at all levels. For each area, we share the DX road map
and plans in the first half of the year and the promotional pro- ·V
irtual product design/ · Worksite establishment DX Awareness Enhancement Activities
gresses, success cases, and plans for the following year in the verification (simulation)
Best Practices Letter DX Promotional Materials
second half. ·V
irtual process design/ ·P
roduction operation
verification (real-time, automated,
intelligent)
Operating Three DX Core Tasks ·Q
uality control
The company is intensively managing three areas: Smart Fac- (prediction, control)
tory, Digital Twin, and Data Operation and Utilization as core · Facilities, safety,
tasks. Focusing on Smart Factories and Digital Twins, we have environment
(prediction, maintenance)
established a Data Operating System to expand our market
share among top-tier customers and to continuously upgrade
them by securing production competitiveness that cannot be
Strengthening Digital Competency
easily imitated and improving customer response speed.
Data Operation For successful DX, it is important to discover good tasks. To strengthen employees’ “Task Discovery” and “Execution Capabilities”
LG Innotek is operating the DX level certification system and the Robotic Process Automation (RPA) certification system.
R&D Production Quality SCM “The DX Level Certification System” assesses employees’ understanding of DX and task execution capabilities in three levels: Basic,
Database Data Junior, and Expert. In 2021, 7.8% of our office workers acquired the certification. Our goal is to have 50% of office workers acquire
Data Data Data
certification by 2023 to promote the team-level completion of DX task implementations.
“The RPA Certification System” assesses the RPA tasks developed by employees and certifies them in three levels: Basic, Elementa-
ry, and Advanced. Through the assessment, 46 employees acquired the Basic level certification in 2021.
Operating DX Tasks
In 2022, we will inspect the progresses of DX task execution each quarter and hold a DX Task assessment and award event led by
the CEO at the end of the year. For the selection of a success case, DX tasks are evaluated on the basis of their “Ripple Effect” and
“Extendibility” as well as “Efficiency.” In addition to DX strategies and task performances of each organization, the assessment also
focuses on the aspects of digital organizational culture and talent fostering.
Smart Workplace
Since the second half of 2019, LG Innotek has been creating a smart workplace to reinvent the work methods. In doing so, we pro-
DX Tasks Annual DX Task Operation Cycle
vide a platform where employees can communicate and cooperate with one another on a real-time basis without time and space
2022 Plan
restrictions. Having introduced the Outlook Mail and Teams in 2020, we are improving the videoconference system in response to
Classification of Tasks
the contactless environment and opening the AI-based translation and chatbot services in stages. By doing so, we are effectively
by Type
providing an environment where our employees can work together remotely, such as through telecommuting considering the
■ Intelligence (Unit: Check
Develop
Conduct interim COVID-19 pandemic.
■ Informatization Task)
the current
strategies/
inspection
Conduct Provide Conduct final
■ *A2D level
operation
(quarterly)
assessment reward inspection Going forward, we will conduct various activities toward the goal of creating an individually customized data-based intelligent
plan service environment centering on AI technologies and intelligent chatbot service.
83 * Award for Image of Smart Workplace

Best Practices
(Task/Team) Where I work is my office Cooperate also with external personnel using a single tool
54 Check e-mail Teams
Commu-
nication · Link to e-mail and schedule
Preparation for 2023 Employees
Any Device Any Time · Messenger
82 Select key · File sharing
78 Discover/
Develop tasks/ Prepare Real-time Coopera- · Document cooperation
24 Prepare Share Outside
plans for key Deliberate on establish report videoconference tion Invite guest · Joint editing
for BP promotional Any Where personnel
tasks and investment details of
39 (Best plans
activities implementa-
Practice) Create an optimal environment through intelligent service Check/Provide feedback on report in real time
tion Inno-
26 * Reflect to * Organize vation
20 Notice Real-time preparation
19 Recommendation Schedule
business plan TDR, set
2020 2021 Plan for KPI etc. FAQ Search
2022 AI Sharing
Employees Regulations
* A2D: Analog to Digital Real-time sharing Real-time feedback
Notification
R&D Innovation
R&D Operation System R&D Process
R&D Strategy LG Innotek’s PLM (product life cycle management) aims to man- Special Case R&D Projects that Delivered Exceptional Performance
age systematically the entire product life cycle from technology
Based on the world’s top-notch materials and components tech-
development to production. This enables us to share innovative
nologies, LG Innotek is developing key components in the Optics Developing the World’s First “Wi-Fi 6E Module for Improvement of Communication Performance, Durability
R&D outcomes and technological expertise at all levels and manage
Solution, Substrate and Material, and Automotive Components Automobiles” and Application Convenience
costs and deliverables comprehensively at each phase of the
Businesses and leading the delivery of compact, highly functional LG Innotek developed the “Wi-Fi 6E module for automobiles”
project undertaking to improve our technology and product Communication Performance
digital devices and convergence of cutting-edge technologies.
competitiveness constantly. for the first time in the world by applying the next-generation
In addition, through open innovation, we secure core source technol- Using the Wi-Fi 6E module for automobiles, pas-
Wi-Fi technology. sengers can watch movies in high resolution and
ogies to lead the next-generation materials and components tech-
nologies and further broaden the scope to discover future growth The Wi-Fi 6E module for automobiles is a near field wireless play AR and VR games through the in-vehicle
R&D Process Flowchart
engines. We are building a global R&D network with the world’s communication component that connects the In-Vehicle Info- display system. The data transmission speed is
leading companies and specialized research institutes to establish CP tainment (IVI) system with smart devices inside the vehicle and 1.2 Gbps (gigabits) which is approximately three
technology leadership consistently and explore untapped technology Concept Planning external router. times higher than that of the Wi-Fi 5 module.
areas for the future. We jointly undertake government-sponsored Network connection time was also shortened to
projects with public research institutes to secure innovative technol- With the next-generation Wi-Fi 6E (6th Generation Extended)
2ms (millisecond, one thousandth of a second),
ogies and operate customized master’s degree courses designed to PP technology using the 6GHz high frequency band applied, it
which is around one seventh that of the Wi-Fi 5
meet specific business needs and various joint R&D projects as part Project Planning provides data transmission speed that’s approximately three
module.
of our cooperation program with prestigious universities; thus con- times faster than Wi-Fi 5.
tributing to the development of both nation and local communities. The independently developed RF and antenna
DV
design technology also ensures prevention of
“To accelerate In-vehicle Infotainment Evolution with
R&D Organization Design Verification
communication interference inside a vehicle
Innovative Product”
where the level of transmission density is high.
CTO R&D by Business Unit
PV This product is in the form of a module integrating the com-
Product Verification munication chips and RF (Radio Frequency) circuits, etc. In-
Convergence Base
Device & Substrate & Optics Durability
Components Technology stalled in multiple areas inside and outside of a vehicle, such
Material Lab Material Lab Solution Lab This product maintains performance even at a
Lab Lab
MP as through the Audio-Video Navigation (AVN) system and
※ As of May 2022 rapid temperature change from negative 40℃
Mass Production smart antenna, this module enables the user to connect his
(Motor R&D Center changed to Automotive Motor Development Office to 85℃. It is not easily deformed when the vehi-
following the organizational restructuring in Jan. 2022, so it was excluded) or her smartphone wirelessly to the in-vehicle display and
cle is parked outside in the cold winter or when
audio system to watch movies and play games. The naviga-
heating occurs during data transmission. It was
tion software, etc. can be conveniently updated as well.
R&D Outcome Management developed to ensure repetitive contraction and
From major R&D outcomes produced over a year, exceptional projects and technologies are recognized to maximize the generation of synergy for expansion with the surface area of the circuit
technologies and products. This is aimed at encouraging and motivating our R&D workforce and employees. Excellent R&D outcomes are awarded. bonding part increased.
R&D Outcomes in 2021

Convenience of Application
Business Area Project Development Outcomes and Expected Benefits
Using high-density, ultra-precision modulation
Optics Mass production of zoom camera module with · Lead the premium smartphone camera technology through mass productiton
Solution variable focal length for mobile devices for the first time in the world technology, approximately 200 components in-
Mass production of 100 million-pixel camera module · Diversify mobile camera products cluding communication chips and RF circuits are
Substrate and Develop substrate for the antenna module and go · Develop substrate for the 5G antenna module using independently developed contained in the product in a size one sixth that
Material into the antenna TP (Tuning & Packaging) business interlayer bonding technology and signal loss reduction technology C
of a credit card.
· E xpected to create synergy with the substrate business as the scope of business
expands to the adjacent TP sector Compatible with the existing Wi-Fi module, it is
Automotive Mass production of 7kW DC-DC bidirectional · Strengthen the DC-DC converter lineup for ESS battery pack simply inserted into the designated position with-
Components converter for ESS (Energy Storage System)
out requiring system design change.
Mass production of Nexlide-E/LDM · Apply Nexlide to stop lamp for the first time by applying optical film to
(LED driver module)for tail/stop lamp Nexlide structure
Mass production of Nexlide-A for garnish lamp · Apply head lamp with Nexlide for the first time in the world
(Expansion of Application: Tail → head logo/grille)
Development of the world’s first Wi-Fi 6E module · Develop module for automobiles with speed that’s approx. three times faster than
for automobiles Wi-Fi 5 as the world’s first by using the 6GHz high-frequency band
Development of digital key module for automobiles · Increase location recognition accuracy to the highest level in the industry by applying
UWB (Ultra-Wide Band) technology and independently developed algorithm
Development of high-voltage · Secure the BMS platform for 800V to respond to the high-voltage trend
BMS (Battery Management System) Platform
Electronic Development of Wi-Fi 6 + Bluetooth combination module · Lead the market by securing differentiated isolator
Components Development of 60W 4*PPoE Wi-Fi 4 bridge · Enter the PoE market for the first time in the world, additionally expand security
* PPoE: Point to Point Protocol over Ethernet business operators
Development of thermoelectric power generation · Develop the thermoelectric power generation module and system using waste heat
module for eco-friendly vessels from vessels for the first time in the world
· Acquire New Excellent Technology (NET) certification from the Ministry of Trade,
Industry and Energy
Open Innovation Protecting Intellectual Property Rights

Special Case Applying AI/Big Data-based
Strategic Direction Under the intellectual property rights vision of “From Innovation Patent Analysis System
to Patent, Patent into the Future”, LG Innotek established the
LG Innotek is operating the open innovation system it has established to achieve materials and components technology innovation
“Patent Portfolio Development and Reinforcement Strategy” LG Innotek established the AI patent analysis system in
and strengthen business competitiveness for the future. Under the system, we intend to create a virtuous cycle wherein we lead
technology development together with our suppliers as strategic partners. and “Patent Risk Minimization Strategy.” 2021. Analyzing the patent big data consisting of tens of
Based on the newly implemented technology investment, we will achieve technological innovation, lead the market, and create an According to the two strategies, we develop and establish thousands of data in a short period of time, this system
ecosystem for shared growth by discovering breakthrough technologies and companies and strategically cooperating with domes- internal systems customized to the respective areas and conduct ensures swift provision of key information necessary in
tic and overseas partners. To this end, we are carrying out various technological investment activities at home and abroad, such as strategic patent activities to link the systems organically to setting the direction for technology development. It is
investing in LG Technology Ventures and funds of materials, components, and equipment makers. R&D outcomes. used for the purpose of protecting our intellectual proper-
In addition, given the growing importance of industry-academe cooperation, we established industry-academe cooperation centers ties and establishing R&D strategies.
by business sector to make use of the professional capabilities of universities. We also established the centers in each region to In terms of business efficiency, LG Innotek’s AI patent
Strengthening Business Competitiveness
secure specialized technologies and human resources for our local worksites. analysis system is capable of processing operations ap-
proximately 900 times faster than humans. For example, an
Technological Cooperation operation to analyze 50,000 patent data—which requires
Technological Investment Cooperation Model Develop and Reinforce Minimize Patent
Cooperation Model 5 persons to work 8 hours a day for over 100 days—can be
Patent Portfolio Risks
completed in only 4 hours.
Having established a division in charge of technological
·C
reate and reinforce ·B
uild patent litigation
investment, LG Innotek operates a technological investment
core patents response capacities AI patent technology classification
process covering the discovery of companies for investment
·B
ecome a first mover in ·S
et the direction for R&D
up to the final investment decision making. In addition, we set
future technology areas Classify patent technologies using machine
a technological investment cooperation model for improving
Increase Discover Secure Strengthen Discover new
R&D efficiency and discovering innovative technologies to learning data customized to classifying
R&D core competitive manufacturing business
find breakthrough technologies and companies in Korea and efficiency technologies edge in The competitiveness opportunities LG Innotek products and technologies
abroad according to the purpose of our strategic investment. value chain
We will establish an ecosystem for strategic cooperation by
R&D Outcomes
continuing the effort.
AI patent technology analysis
Industry-Academe Cooperation Industry-Academe Projects

Analyze patent technologies
While establishing industry-academe cooperation centers for by recognizing the nuance of the sentences
Industry-Academe R&D Projects
each of the four universities, strengthening networking with Patent Applications (Unit: Case) in the patent specifications using an AI model
them, and implementing incubation projects, LG Innotek is No. of Projects Project Cost
Category 2019 2020 2021
developing cooperation programs with the startup innovation (Unit: Project) (Unit: KRW 100 million)
center. The technologies developed through cooperation are 9.0 Domestic Registration 5,724 6,204 4,049
managed for application to our products. We also strengthen In Application 7,417 5,562 4,094 Automatic analysis report
7.4
our R&D competency by securing and fostering excellent hu-
Overseas Registration 8,208 9,247 5,159 Provide templates for each purpose of analysis
man resources in the partner universities.
In Application 5,876 4,311 3,975 ·S tatus of technology development
2019 2020 2021 3.5
by company, year, and country
15
※ Patent applications decreased in 2021 due to the impact of the sales of
6 10 the LED business sector.
· Joint development status by company
2019 2020 2021
※ The data were calculated as of April 2022, and they may vary from the
data disclosed in the annual report.
Government-Sponsored Projects
Having established regulations for government-sponsored projects, LG Innotek is managing the project implementation status by
stage, details of project cost, and outcomes according to the regulations.
Government-sponsored R&D Projects (2019-2021)

Area Project Title Sponsoring Organization Period
Components and materials Development of ultra-high purity *SiC materials Korea Evaluation Institute of Industrial 2010.09-2019.03
technology development Development of ultra-high purity SiC powder technology Technology
Development of SiC epitaxial materials for energy
semiconductor devices
Development of energy-saving high heat dissipation nano
composite materials
Energy technology Development of low- to medium-temperature thermoelectric Korea Institute of Energy Technology 2016.09-2019.08
development generation devices through power modulation Evaluation and Planning
Korean Smart Farm Development of real-time biometric data/behavioral measure- Rural Development Administration 2018.03-2020.12
core technology development ment and unmanned automation technology for chicken farms
Energy demand management Development of thermoelectric power generation device/ Korea Institute of Energy Technology 2021.05-2024.04
core technology development power module mass production process technology Evaluation and Planning
* SiC: Silicon Carbide

Environmental

EESH (Energy, Environment, Safety, Health) Management System
Vision
GHG Emissions Intensity Global No. 1 EESH Leader in the Materials and Components Industry
2.46 tCO eq/KRW 100 million

2
Mission
Through advanced EESH management, we ensure our workplace is injury and accident-free and
eco-friendly, and elevate the quality of life for all, and preserve the environment.
Reduced by 33% y-o-y
Target
Waste Recycling Rate
88.5% Energy
· Zero UT accident
· 100% energy efficiency
Environment
· Zero environmental impact
· Zero hazardous substance
Safety
· Zero accident
· Zero fire
Health
· Zero occupational disease
· Health management
· 100% renewable energy · 100% waste recycling · Safety culture index-Level A system-Level 5
· Health management
competency-Level 5
Zero Waste to Landfill

Establish safety and environment culture Develop emergency response system Secure global top-tier competency
certification
Platinum level Under the vision to become “Global No. 1 EESH Leader in the Materials and Components Industry”, LG Innotek is performing
(Gumi Worksite 2, 3) change management activities by sector. We are developing strategies, managing targets, and performing improvement activities
by establishing a total of 79 regulations and guidelines, and establishing the EESH management system applied to all domestic
worksites on the basis of international standards, such as the ISO 14001 environmental management system, ISO 45001 health and
safety management system, and ISO 50001 energy management system. As a result of the effort, there have been no significant
violations of the environment-related laws and penalties over the last three years.
Green Standard for Energy

ISO 14001 Certification
of Worksites
ISO 45001 Certification
of Worksites and Environmental Design Green Level 2
Magok
100 % 100 % Worksite Building Energy Efficiency
Grade Level 1
(as of May 2022)
Safety and Environment Regulations in Response

LEED Certification Silver Level
Regulations/Guidelines to Safety and Environment
Field Gumi Worksites Green Company
79 60 1 and 1A Designation
Resource Circulation Resource Circulation Certification

Using the “Resource Circulation Certification” system according to the Framework Act on Resources Circulation, LG Innotek Gumi
and Gwangju worksites obtained recognition of their waste plastic trays as circulatory resources, not wastes, Gumi worksite, where
the largest production facility is located, is leading changes towards the society of circular economy by obtaining the “Quality
Waste Management
5R Label” marking quality information of circulatory resources for the waste synthetic resin. To establish a basis for waste circulation
LG Innotek creates new values for wastes by performing performance management, we also performed activities to reduce disposable plastic use, and developed a technology for internal
the 5R activities to reduce the amount of waste generation treatment of hazardous waste.
in production and transportation processes, and retrieve
materials that can be reused or recycled, etc.
Waste Generation and Treatment
In 2021, we performed activities to identify the level of our Waste Generation Waste Treatment ■ Landfill ■ Incineration ■ Others
internal management and strengthen the management Reduce Reuse Recycle Retrieve Refine (Unit: Ton) (Unit: Ton)
capabilities by introducing the domestic and international 4,590
Reduce waste Reuse Recycle Retrieve Use refined
generation waste waste valuable metals metals 462
resource circulation-related certifications. Our efforts have also
2021 Domestic 2021 Domestic
been recognized internationally. 36,221 804 4,175
3,337
2,672 98
Waste Management Process 3,324
162 549
2021 Overseas 606 2021 Overseas
39,773 2,690
Plan Do 415
34,871 3,552
· Separately store waste by type 1,904
23,236
· Waste generation · Check new waste generation, permits,
· Sort waste into hazardous and general waste and discharge information
· Discharge waste 2019 2020 2021 2019 2020 2021
※ 2019 data based on domestic worksites, 2020-2021 data based on all domestic and overseas worksites
· Derive areas requiring improvement · Monitor management facilities

and implement improvement · Monitor for changes in permits Check
Waste Recycling
Recycled Amount Waste Recycling Rate

Action Check
(Unit: Ton) (Unit: %)
2021 Domestic
2021 Domestic
88.5
32,045 88.5
90.4
88.5
Domestic and International Resource Reuse
Certifications 35,182 2021 Overseas 2021 Overseas
31,534 3,137 88.3
20,565
In 2021, LG Innotek won the Platinum level of the “Zero Waste
to Landfill”, a global certification for resource circulation,
as the first in materials and components industry. The Zero 2019 2020 2021 2019 2020 2021
Waste to Landfill is an international index of the UL (Under-
※ 2019 data based on domestic worksites, 2020-2021 data based on all domestic and overseas worksites
writers Laboratories), a global safety certification agency, to
assess businesses’ effort for resource circulation. Businesses
recording the waste recycling rates of 100% is awarded with
Platinum, 95~99% is Gold, and 90~94% is Silver level. * Zero Waste to Landfill Certification Award Ceremony Domestic and International Resource Recycling Certifications
LG Innotek monitors the entire life cycle of waste from its discharge to final treatment at worksites through a connection to
Our Gumi work sites 2 and 3 achieved 10 0% resource
Production Worksites the “Allbaro”, the system of the Ministry of Environment. We also conduct annual assessments and inspections on companies
circulation (recycling) for 22,000 tons of waste. Through waste
consigned of waste treatment and recycling operations. We turn general waste into solid fuel and reuse it as supplemental fuel,
recycling, we could reduce GHG emissions by almost 970 tons a
while making plastic and other recyclable waste into recycled raw materials. Waste solvents are also turned to recycled fuel oil and
year. This is similar to the effect of planting 150,000 pine trees.
used as supplemental fuel.
Gumi worksite C4 and Gumi worksites 1 and 1A won the Zero Platinum Gold Certified
(Gumi 2, 3) (Gumi C4) (Gumi 1, 1A) We have established a waste treatment process by waste type to minimize environmental load and joined the packaging recycling
Waste to Landfill Gold level and Zero Waste to Landfill Certified
cooperative to expand the scope of recycling and increase resource circulation.
levels respectively. Our goal is to obtain the certification for all
domestic worksites by 2022. In addition, we respond to and continuously review our obligation to recycle electrical and electronic products, although the WEEE
(Waste Electrical and Electronic Equipment), a program for waste product recovery, does not apply to electrical and electronic
components makers.
Employee Engagement
Water Consumption (Unit: Ton) Water Consumption Intensity (Unit: Ton/KRW 100 million)
LG Innotek holds a campaign through employees’ participation to reduce the use of disposable plastics, one of the most frequently
used and discarded wastes in everyday life. Waste PET collection boxes were installed in worksites by remodeling the recycling
boxes, and recyclable plastic materials are separately discharged. At the cafeterias, plastic straws are being replaced with paper
124
straws, and free drink is offered to persons using tumblers more than the set number of times. In 2022, we plan to continuously
perform various activities including the “No Paper Cup Campaign.” 2021 Domestic
95
8,728,568
63
Water Resource Management 2021 Overseas
9,887,468
9,370,849 642,281
With the level of interest in water resource management increasing across the globe, LG Innotek is strengthening management 9,102,894
on the water resource-related risks. While managing the amount of water consumption in domestic and overseas worksites, we
continuously perform improvement activities in response to external assessments, such as *CDP Water.
2019 2020 2021 2019 2020 2021
* CDP (Carbon Disclosure Project) is a nonprofit organization assessing management information of approximately 13,000 global businesses in relation to their
response to environmental issues, such as climate change, water, and forest resources. ※ Water resource consumption intensity =
Water resource consumption (Ton) / sales (KRW 100 million)
Water Resource Reuse and Recycling

Gumi worksite is using treated sewage as industrial water. Wastewater generated from production processes is reused as cleaning Water Resources Reused (Unit: Ton) Water Resources Reuse Rate (Unit: %)
water for the air pollution prevention facility (absorption tower).
International Certifications and Awards 53.4

2021 Domestic 53.4
Through obtainment of the Leadership A grade in the CDP Water Management Assessment in 2021, LG Innotek has selected as the 2021 Domestic
4,954,980 41.9 56.8
Best Company in Water Management for five consecutive years since 2017.
Strengthening Water Resource Management Infrastructure 2021 Overseas 2021 Overseas 7.1
5,000,582
45,602
Using a dashboard in the management information system, company-wide water resource consumptions and reuse rates are 4,862,802
4,139,432
managed on a monthly basis. For suppliers, we also conduct water risk management during safety and environmental inspections.
2019 2020 2021 2019 2020 2021
Waste Resource Risk Management Program
Direction Activities Detailed Activities

Establish Water Resource Manage Water Consumption · Manage annual water resource consumption intensity
Water Resource Management Process and Consumptions (Unit: Ton)
Management System · Invest in facilities to reduce water consumption
Increase Recycling · Increase investment in recycling facilities
- Invest in water/wastewater recycling facilities Industrial Water Withdrawal/Use
- Perform research activities to increase recycling rate through industry 3,847,963 9,370,849
academia cooperation (Reuse 5,000,582)
Respond to Regulations · Monitor global legal trend and develop response plans
· Apply management criteria stricter than legal levels Sewage Reused
Preemptively Manage Respond to Wastewater Leakage · Operate and provide training on emergency response system 4,197,084 Internal
Water Resource Risks and Legal Risks Wastewater
· Strengthen effluent monitoring system
Treatment
· Disclose CDP Water information Facilities
Potable Water
1,325,802
Discharge
7,751,853
Wastewater/Sewage Treatment Plant Discharge

Pollutant Management Management of Chemicals

LG Innotek is protecting the environment and ecosystem, and providing eco-friendly value to customers by applying internal To secure safety of chemicals and respond to the related regulations, LG Innotek conducts pre-inspection on all chemicals by
standards that are more stringent than the legally applicable regulations. Improvements were made on external risks in accordance establishing the Chemical Management System (CMS).
with the ISO 14001, and regulatory checklists were introduced to follow the PDCA cycle for environmental management. In
addition, we are committed to fundamentally preventing environmental pollution by maintaining pollution prevention facilities,
Chemical Management Process
applying eco-friendly facilities, and improving processes.
All chemicals must pass through the pre-inspection and approved by Health, safety, and environmental staff before they are
received into the Company. Before conducting a pre-inspection, the person in charge of the inspection checks applicability of the
Air Pollutant Management Water Pollutant Management
domestic regulations, such as the Chemical Substances Control Act, the Act on Registration and Evaluation of Chemical Substances,
Air pollution prevention facilities optimized to pollutant LG Innotek complies with the related laws and regulations,
and the Occupational Safety and Health Act, and responds to them as necessary.
discharge reduction and air environmental improvement such as the Water Env ironment Conser vation Ac t , by
are being installed and managed. In each worksite, the establishing internal criteria for water quality management,
Chemical Management Process
discharged pollutants are measured on a regular basis, and and analyzing and monitoring the pollutant discharges. While
pollution reduction facilities are introduced to comply with requesting periodic analysis to a professional agency to
Request pre-inspection Review documents on Receive and use
the tightened air pollutant emission criteria. In particular, the monitor for water pollutants in the wastewater discharged, Conduct pre-inspection Manage amount of use
of chemical substance Chemical substance chemical substance
concentrations of pollution are analyzed in relation to all air we internally analyze the key pollutants on a daily basis. We
pollutants once a year. Also, the occurrence of new pollutants are also replacing old wastewater treatment facilities through
·R
equest pre-inspection · *MSDS, *LoC, etc. · Check legal regulations · Receive and use chemical · Manage amount of use
is checked. LG Innotek is also establishing mid- to long-term assessment, and introducing wastewater reuse system to
before chemical · Check supplier substance substance for which ·M ake legally required
investment plans for old facilities based on assessment of the minimize the amount of wastewater generation. substance is received · Make advanced response, pre-inspection and reports
facilities, and thereby preparing for possible risks. such as to obtain permit approval have been
Management of Volatile Organic Compounds (VOCs) * MSDS: Material Safety Data Sheet for change completed
Since 2021, we have been strengthening the related investments, Volatile Organic Compounds ( VOCs) collectively refer to LoC: Letter of Certification
such as to install backup equipment for air pollution prevention substances that exist in a gaseous form at room temperature
facilities in each worksite. In addition, we reduced NOx (Nitrogen because of high vapor pressure. LG Innotek is not categorized
Oxide) emissions by installing the low NOx burners and ultra as a company engaged in businesses emitting a large amount Employee Training Establishing Chemical Management Infrastructure
low NOx burners in boilers, which are major emission facilities. of VOCs. However, to ensure high-quality management, we To ensure safe use of chemical substances, LG Innotek For product quality and supplier management, LG Innotek
regularly measure the Total Hydrocarbon (THC) content. Also, places the *GHS and MSDS about the substances used in the established the chemical management system (CMS) through
we have set and are complying with an internal standard of respective worksites, and provides regular training to persons which the chemical inventories of suppliers are registered,
70%, which is more stringent that the legal permission level. handling chemical substances. We also provide training on pre-inspected, and managed. While preventing chemical
Air and Water Pollutants Discharged management and handling of chemical substances to all leaks by installing detection sensors, we make sure to fully
employees for at least two hours a year. protect safety by organizing drills targeting all employees in
Pollutant Unit 2019 2020 2021
* G HS: Globally Harmonized System of Classification and Labeling of preparation for chemical leakage accidents.
Air Pollutants Domestic Domestic Overseas Domestic Overseas
Chemicals
Emissions SOx 16.4 1.4 8.8 1.4 2.4
NOx 25.7 10.9 5.0 13.7 7.0
Ton Chemical Management System (CMS)
Dust 15.1 12.8 7.4 11.4 12.7
Total 57.2 25.1 21.2 26.5 22.1
Emissions Concentration SOx 0.7 0.0 - 0.3 -
against Legal Limit NOx % 4.4 5.1 - 8.3 - Check regulations/
Dust 3.1 4.1 - 3.6 - obtain required Conduct Manage
permits and pre-inspection amount of use
Water Pollutants approvals
Discharges BOD 318.0 311.0 7.0 154.0 12.0
COD 283.0 209.0 49.0 235.0 60.0
SS 105.0 128.0 19.0 89.0 24.0 Strengthening Chemical Management System
Ton Measure work Manage supplier
T-N 165.0 77.0 9.0 174.0 7.0
environment substances
T-P 5.0 4.0 0.3 4.0 0.8
Total 876.0 729.0 84.3 656.0 103.8
Emissions Concentration BOD 40.3 25.4 - 8.4 -

against Legal Limit COD 28.9 13.9 - 19.9 -
Conduct risk Manage Hold emergency
SS % 7.7 9.2 - 11.9 - assessment MSDS response training
T-N 16.8 9.2 - 20.5 -
T-P 3.6 6.5 - 10.7 -
※ SOx: Sulfur Oxides, NOx: Nitrogen Oxides

※ BOD: Biochemical Oxygen Demand, COD: Chemical Oxygen Demand, SS: Suspended Solid, T-N: Total Nitrogen, T-P: Total Phosphorous
Eco-friendly Products
and Technologies
Sustainable R&D
Product Stewardship ESG Activities for Packaging Materials

Special Case Developing Product to Reduce the Use of Rare Earth Element Eco-friendly Magnet
LG Innotek is promoting eco-friendly packaging to reduce
LG Innotek takes environmental factors into account from
the cost of using disposable packaging materials at the same Together with Star Group Ind, a company specializing in magnet
the stage of product development. Extending from the 5M
time as minimizing environmental impact caused by the use of production, LG Innotek successfully developed the “Eco-friendly
(Man, Machine, Material, Method, and Measurement) model
plastic, vinyl, and paper box-type packaging materials when Magnet” producing the highest magnetic force in the world.
of quality management to include the environmental aspect,
receiving components. In 2021, we organized a task force for For this product, the use of heavy rare earth element, a core
we cater to customer needs and take into consideration the
eco-friendly packaging material use and automation. Since material for a magnet, was drastically reduced by approximately
environmental impact caused by production activities.
then, we have also been promoting improvement in terms of 60%. In addition, the magnet performance for home appliances
the 3R (Reduce, Reuse, Recycle). and automotive steering motors was increased to 14.8kG
Reducing the Use of and Substituting Rare Resources (kilogauss, unit of magnetic induction), the highest in the world.
LG Innotek is promoting to develop materials and components Reduce With specifications and standards established
for packaging design and development stages, When the “Eco-friendly Magnet” is applied to a high-resolution
with which to reduce or replace raw materials used in the
defect rate in packaging materials will be smartphone camera, the actuator driving power is raised by
process of electronic and electrical product manufacturing,
lowered, and therefore waste generation and approximately 10%, and therefore clearer and higher-quality
such as cobalt and rare earth element. We are conducting
cost reduction are expected. photos and videos can be taken. As the amount of heavy rare earth
management to minimize the use of conflict minerals, such as
element used in this product is only 40% that of other products,
the 3TG (tantalum, tin, tungsten, gold), as well as resources Reuse LG Innotek also started a project to change the “Eco-friendly Magnet” not only keeps the risk of production
that cause social issues due to their rarity. the disposable container for components to discontinuation due to raw material shortage to a minimum, but
* For details, please refer to Supplier ESG in this Report (p. 83). a multi-use container. This project has been
also holds ESG-wise significance
started by Optics Solution (camera module) and
Automotive Components (automotive motor)
Life Cycle Assessment (LCA) Business Units, and will be expanded across
In the first half of 2022, LG Innotek is conducting the full LCA company after 2022.
by selecting the target product groups. By selecting one model Special Case Developing Product to Reduce Energy Loss: RF-SiP
each of camera module and 3D sensing module, the product Recycle In addition, we are reviewing plans to reduce
RF-SiP (Radio Frequency-System in Package) substrate is a product to integrate a semiconductor package with integrated circuit
groups generating the largest sales, from Optics Solution the amount of packaging materials incinerated
and buried in landfills, and change them to (IC), RF, logic chip, and device.
Business Unit, we will measure and analyze the environmental
recyclable materials. The core technology applied to RF-SiP is to implement composite functions in a single system, and therefore reduce the product
impact in terms of carbon footprint, water footprint, impact on
ozone layer, acid rain, eutrophication, resource footprint, and thickness to 0.3mm or less. LG Innotek developed the world’s thinnest product by using the independently developed ultra
photochemical smog, and derive improvement tasks. We will Packaging Area Improvement precision and high integration technologies, such as coreless (to remove core layer from semiconductor substrate) and micro
continue expanding product groups for full LCA after 2023. LG Innotek strives to create a safe working environment by circuit.
From 2025, we plan to establish an internal LCA operation checking the conditions in packaging areas. In addition, we Launched in 2021, RF-SiP substrate is thinner by 20% than the precious model. The thickness is even smaller than that of a
process, and therefore internalize the assessment. For the standardized environmental regulations for packaging areas business card. It is also as small as a typing key on a smartphone. This small substrate can contain around 100 components
LCA results and improvement activities, we will continuously in each worksite, removed risk factors, and are performing including a communication chip and a filter.
communicating with stakeholders. activities to prevent packaging quality issues. Starting with With high-density and high-integration performance, LG Innotek’s RF-SiP substrate produces little signal loss. When the amount
domestic worksites in the first half of 2022, the activities will of signal lost decreases, smartphone makers can improve battery efficiency and solve the problem of battery heating, which are
be expanded to overseas worksites in the second half. key issues in the industry. LG Innotek’s differentiated technology enables transmission of a larger amount of signals using little
power, and also reduces the amount of heat generated due to signal loss.
By applying the signal loss reduction technology using a new material to address the problem of delayed signal delivery and
special surface treatment technique using copper, LG Innotek succeeded in lowering the signal loss by up to 70%.
Employees PRIDE, LG Innotek
Employees fully engage in their work with enthusiasm when they are proud of the company and work, and this serves as
a drive for customer value creation. Towards the vision to become the Global No. 1 Material and Component Company,
LG Innotek performs the “PRIDE” activities to enhance employees’ pride. LG Innotek’s PRIDE is an acronym of
Performance, Reward, Industrialization, Dynamics, and Expertise. Each of these words represents the five domains that
influence the pride of LG Innotek employees.
Performance
Company’s Growth and Vision
Company with high profitability

and continuous growth
s
es
usin
B P
Reward Expertise
Treatment and Compensation R LG Innotek,
E Growth as Experts
Company where everyone Company that provides new

Becoming
becomes a professional and is opportunities for its employees to
treated and rewarded accordingly My PRIDE become experts
I D
re
ltu
Cu
Individualization Dynamics
Working Environment and Program Working Method and System
Company that creates a customized Company of which the employees

work environment and program in work dynamically with a sense of
which its employees can produce autonomy and responsibility
maximum performance
Employee Satisfaction Employee Participation in

Human Rights Assessment
LG Innotek aims to create a “dynamic workplace of which the employees are proud to be a part.” The
88 points
expectations about a company’s vision, treatment and compensation, work arrangements and systems,
※ [Great Place To Work] survey result
100 %
working culture, and potential for personal growth are on the rise. Accordingly, the importance of these
factors is amplifying for prospective employees’ decision to join a company and employees’ immersion in
their duties. When employees are proud of their company, they can fully engage themselves in work with Employment Rate of Training Expenses per Person
enthusiasm, deliver differentiated value to customers and, ultimately, drive customers’ success. We firmly People with Disabilities
KRW 660,000
2.8 %
believe that we can become the Global No. 1 Material and Component Company in a genuine sense when
we fulfill our social responsibilities based on our employees’ pride. In 2020, we defined improving the pride (increased by 113% y-o-y)
of our employees as the first step to achieving our vision, and have since operating the “PRIDE” program. ※ 2022 Goal: 3.1% ※ 2022 Goal: KRW 750,000
Reward: Compensation System Creating Culture to Encourage Leave Welfare and Benefits Expenses (Unit: KRW 100 million)
LG Innotek creates a culture encouraging employees to take

Assessment System We also operate separate compensation systems by job group, leaves for getting adequate rest. Our annual vacation calendar
2019 2020 2021
such as production, quality, and R&D. In particular, for projects helps employees to take sufficient rest and refresh themselves
Performance Management Process
LG Innotek’s performance management process follows the
that hold importance across the Company,compensation
targets are selected through a fair review led by the CEO upon
by designing their leaves. We also introduced a vacation 1,381 1,480 1,723
program to provide two to four weeks of vacation for every
cycle of goal setting, review and assessment, and feedback to completion of mid- to long-term projects. In addition, to prevent five years of continuous service so that our employees can
ensure fairness and transparency of performance management. safety and environment-related accident and minimize quality fully recharge themselves and pursue self-development.
All employees receive performance assessment each year. We risks, we provide compensation by reflecting quality risk and
also operate the performance feedback system to review and accident prevention-related assessment indices in executive Improving Employees’ Welfare Support for Work Environment
offer coaching about employee’s performances on an ongoing assessment.
basis. In addition to employee fostering, this system provides Welfare and Benefits Programs LG Innotek is commit ted to creating an optimal work
a function to strengthen fairness in annual performance Retirement Pension Under the basic philosophy that “ To achieve customer environment to help employees develop a sense of pride in their
assessment. For stable retirement pension payout, LG Innotek prepares experience innovation, employees, the subject leading work and about the Company.
Since 2021, we have been conducting the multi-dimensional the fund for retirement person through nine external financial innovation, should be happy”, LG Innotek operates a range
evaluation on all office workers to strengthen fairness of institutes. Our retirement pension program, categorized of welfare and benefits programs to help employees achieve
assessment, improve cooperation, and provide our employees into annuity payments and lump-sum payments, has been work and life balance. We ensure that our employees feel a In-house Cafeteria
with growth opportunities. operated since 2011 to provide protection for retirement sense of pride about the Company by operating a system through In-house cafeterias are operated at all worksites through
security of our employees. which we listen to employees’ opinions on a regular basis. consignment to professional meal ser vice companies to
At the same time, we are bolstering employee management
capabilities of team managers by including various organizational Year-end Balance of Retirement Pension Fund In 2022, we installed new programs and supplemented the provide employees with healthy and nutritious menus. In
(Unit: KRW
management items, such as prevention of employee punishment, 100 million) existing, such as to increase the amount of support for medical 2020, we operated the “Company-wide Cafeteria Operation
safety and environment-related accident prevention, employees’ expenses for employees, increase the amount of housing loan Committee” to repair and improve old facilities in worksites
2019 2020 2021
retirement risk management, and employee fostering and that are in need of environmental improvement. We also
5,397
service, provide financial support for infertility treatment, and
coaching, in their assessment. 3,790 4,395 increase parental leave period, to take into consideration not conduct regular monitoring to collect employees’ opinions
only our employees, but also their families. ab ou t t he quali t y of t he menus ser ve d at c afe ter ias
※ Retirement Pension Fund Operation: The Defined Benefits (DB) option (composition and taste) as well as hygiene and health.
Compensation System was introduced for all employees. The Defined Contribution (DC) option,
however, is applied to employees who are subject to the salary peak Welfare and Benefits Programs for Work and Life Balance
LG Innotek’s employee compensation package consists of a program and to employees whose pension payouts can drop due to the Dormitory
basic annual salary, incentives, and profit sharing. The system reduced work hours. Housing · Dormitory and company housing
is operated in such a way as to motivate employees through and ·S upport for moving expenses incurred from LG Innotek provides safe and pleasant residential environment
performance-based real-time compensation.

Personal job relocation to employees who live far from the workplace by operating
Individualization: Life · Housing loan support (increased in 2022) dormitories.
Fixed Basic Annual Salary: Annual salary Work and Life Balance, and Welfare and · Group insurance
·F inancial support for family events
(Wage: Paid monthly, Holiday Bonus: Paid on Benefits Office Space
(increased in 2022)
holidays for the New Year’s Day and Chuseok) LG Innotek established Smart Working Zone (hub office), which
Flexible Work System and Vacation is open to all, in key strategic locations. Smart Working Zone
Family · Children’s tuition
Variable · Profit Sharing: Paid in accordance with the Strengthening Flexibility in Work Arrangements ·M edical expenses for employees’ families, was installed to help employees select their work locations
Company’s business performance comprehensive health checkup for spouses near home to reduce commuting time, and therefore make
LG Innotek facilitates flexible work arrangements to promote
· Corporate childcare center efficient use of their time. According to different purposes,
· Annual Incentive: Paid in accordance with the employees’ work and life balance, and improve vacation practices.
·C ongratulatory school admission gifts for
level of achievement of the set corporate goal Smart Working Zone will be established as Cooperation Zone
Our flexible work policy allows employees to design their children of employees and gifts for childbirth
and individual annual performance and Intensive Work Zone to improve employees’ immersion in
own work schedules in consideration of their individual and ·F inancial support for infertility treatment
· Irregular Incentive: Paid in accordance with (introduced in 2022) and efficiency of work.
organizational conditions. Flex-time, selective work hours, flexible
project performance on the individual/team level · I ncrease of parental leave period
work hours, work-at-home, and hub office operations contribute
(increased in 2022):
to creating an environment where employees select work
1 year → 1 year + 1 year (unpaid)
arrangements according to their individual and organizational
· Nursing room
Compensation by Job Group conditions, and therefore maximize their performances. For
To ensure competitive compensation considering the internal temporal flexibility, we expanded the flex-time system and
Health · Comprehensive health checkup (increased in 2022)
job position system and external market value, LG Innotek introduced the selective work hours system. For spatial flexibility, · Counseling center
provides fair compensation based on employees’ performances Work-from-home system has been established. In addition, we · Health management center
and capabilities. We comply with the related laws, such as that reduced employees’ travel time by operating a hub office (near ·F inancial support for medical expenses of
on minimum wage. There are no disparities in wage by gender. Seoul Station). Moreover, various spaces for different uses, such employees (increased in 2022)
(As of 2022, the ratio of entry-level office workers’ wage to as a standing conference room and Focus Zone, were installed for
minimum wage is 178%.) use by employees according to their needs. Leisure · Condominiums and training centers
Activities ·O ptional welfare benefits
As for profit sharing, we ensure transparent and fair Improving Temporary Flexibility Improving Spatial Flexibility (employees selecting welfare and benefits
compensation by clearly communicating with employees the
Flex-time, Work-from-home, programs as they need)
criteria for differentiated payment in advance. · In-house clubs
selective work hours working at hub office
Special Case Restructuring Key Welfare and Benefits

Dynamics: Working Method and Diversifying CEO Communication Channels and Expertise: Competency Development
Strengthening Activity
Programs in 2021-2022 Organizational Culture
A company ’s competitiveness comes from successful
Talent Development Strategy
Maternity Protection and Childcare Support LG Innotek pursues to create a culture through which communication. Through various communication programs, LG Innotek fosters talents that nurture the dream to be the
employees work dynamically based on autonomy and a sense LG Innotek encourages employees and executives, from new
LG Innotek is creating an environment that is helpful No. 1 and will certainly become one under any circumstances.
of responsibility. We aim to establish a culture that helps employees to the CEO, share important information and listen
for childbirth and childcare, the important issues in our When the leader clearly suggests the dream and goal
our employees immerse themselves in work with a sense of to each other’s opinions.
society. In 2022, the parental leave period was increased to become No. 1 to employees, and the employees take
responsibility, display their creativity, communicate freely, and actions to fulfill the dream and goal, we will be able to
from one to two years. Also, the cost of infertility treatment Through CEO Live, a real-time communication program for all
work happily with others. realize the dream to be No. 1 at the same time as building
is supported to lower financial burden of infertile couples. employees, our business status and issues, news about the
Company, and CEO’s message are shared quarterly. We host professional capabilities. Providing open opportunities to
regular executive workshops to share the CEOs philosophy all employees, both full-time and contract workers, interns,
Gifts to Employees’ Children
Creative Workplace that Values Equality and management policy concerning company-wide business and also employees of suppliers to assist in their growth to
LG Innotek provides a gift comprising of a laptop computer professionals, LG Innotek supports every employee to become
LG Innotek is creating a culture to value equality within which strategies and organizational culture approaches. Also, the annual
and stationer y items to employees’ children starting CEO vision training is provided to all employees. In addition, each No. 1 in their respective fields.
employees freely exchange opinions by respecting one
school. As part of the “Gift according to Life Cycle” system, month, the CEO’s message is shared with all employees in the
another, and unleashing creativity in the process. In 2020,
the gift is presented to employees’ children to congratulate form of a letter and, through “It’s on the CEO” program, gifts and
our employees started addressing each other by their name Talent Development Strategy
them on starting school and cheering for their happy messages are presented by the CEO to encourage employees.
followed by a simple “Mr.” or “Ms.” In 2021, we also promoted
school life.
to create the “Speak Up” culture. Speak Up culture is aimed
Generate business performance
Since 2021, laptop computers have also been provided to at encouraging individuals to speak freely of their thoughts,
children starting middle and high school. and therefore identifying areas that require improvement.
LG Innotek strives to create a culture through which employees
solve problems together based on collective intelligence. Develop talent at the right time
In addition, i-Lab season 2, a program to develop ideas

suggested by employees into business items, was operated Strengthen talent development training
to encourage our employees to take on new challenges. “Fail
Smart” program was also implemented to share failure cases, · Compulsory training
Develop and operate various
and therefore turn failure into an opportunity for learning. · Professional job training
* CEO Live educational programs
· Leadership training
to support the growth of
· HPI (High Performance
Special Case i-Lab employees
Zero COVID-19 Blue Project Individual) training
i - L ab program, which is held for the second time, To relieve the COVID-19 Blue caused by the prolongation of
encourages and supports employees to suggest ideas, the COVID-19 pandemic, LG Innotek performed activities with
Facilitate learning at the organizational level
which are then developed into business items. Employees a focus on stress relief and sharing happiness. For employees
Support for Employees Due for Retirement
suggesting ideas receive the Design Thinking/ Idea feeling depression in the pandemic situation, we expanded the
LG Innotek operates “Care” program for employees due Development training. They develop ideas in detail, personal counseling service, and also prepared opportunities
to retirement in order to thank them for their service and and prepare project proposals based on their ideas. A for enjoyable communication among employees by offering Maximize collective
contribution to the Company’s development, and cheer for project selected through voting is implemented with the “Online Play” and “Lucky Box” programs. intelligence through Mutual · *CoP
their life after retirement. Company’s support. In 2021, out of 20 idea proposals, learning among employees · Development through work
In 2021, reemployment training assisting in life design three projects were selected. These projects are currently to improve organizational (mentoring, **OJT)
after retirement was provided to all employee who wished in implementation. problem-solving capacity
to take the course.
In December each year, LG Innotek presents a plaque

of appreciation and a bouquet of flowers to the retiring
Reinforce self-initiated competency development
employees to congratulate and thank them for their service.
· INNO Smart Learning

Upgrade execution
* “Bedroom Hidden Singer”, one of Zero COVID-19 Blue programs (Online learning platform)
capabilities through
· Care Coaching
program/system support
MWT (Making a Winning Team) · Learning mileage
MWT is LG Innotek’s organizational culture activity where

team members gather every month to take the initiative in
their change management. Led by CA (Change Agent), the * CoP: Community of Practices (learning community)
team members spread the directivity for the company-wide ** OJT: On the Job Training (education through practical experience)
organizational culture, derive and implement customized
tasks by themselves, and therefore improve organizational
culture in their respective teams.
Educational Infrastructure System Training Programs Internal Recruitment and Job Rotation
Open Career Market serves to provide employees with We improved fairness in recruitment process and accuracy of
INNO Smart Learning Compulsory Training
opportunities for job transfer, expatriation, and degree earning, talent selection by introducing the AI document screening and
I N N O S ma r t L e a r nin g , a n o n l in e l e a r nin g p la t f o r m , LG Innotek provides on-boarding training to help new etc. With this program, employees can experience various job AI video interview systems.
provides a wide range of learning content spanning from employees develop basic skills, job position-specific required areas and develop their capabilities. LG Innotek also encourages
professional job training to leadership training, foreign training aimed at strengthening required competencies by job job rotation by assigning a goal to each organization so as to help Recruitment of Employees with Experience
language prac tice, education on R&D, and liberal ar ts position, and general competency building training to support employees broaden their work experiences. LG Innotek is reinforcing recruitment operations also for
content. Internal exper ts are currently engaged in the employees’ efficient execution of operations. applicants with previous work experiences. To improve our
Internal Recruitment (Unit: Person, %)
production of internal training materials containing their In particular, for new employees, we provide a six-month business capabilities, we hire talented individuals who bring
Category 2019 2020 2021
success and failure cases to develop a more customized fostering program to assist in their fast adaptation to the their diverse experiences accumulated at leading companies
curriculum. LG Innotek will continue expanding the pool of Internal Recruits 1,066 842 462 and institutions as well as globally recognized work expertise.
organizational culture and self-initiated growth.
in-house educational experts in each job area. Positions Filled through 84 75 41 In order to discover exceptional individuals, we use a range
Internal Recruitment (%)
Professional Job Training of online platforms as well as the internal recommendation
※ Domestic system and search firms.
INNO Smart Learning Contents Internal Instructors LG Innotek develops and operates annual professional job ※ Ratio of positions filled through internal recruitment in 2019-2020 is higher
training programs to help employees build global top-notch according to business portfolio adjustment.
Employment Brand Enhancement
※ The figures for the ratio of positions filled through internal recruitment
15,800 Approx. 180 expertise in their respective areas of work.
The training categories include R&D, quality and production

differ from those in the previous year’s Sustainability Report because of
change in the ratio estimation criteria. Ratio of positions filled through
LG Innotek introduces the Company’s work environment,
organizational culture, and job details by using such channels
internal recruitment = (Internal recruits/total recruits) x 100
technology, B2B marketing, and process/equipment/facilities. as YouTube in order to elevate the brand as an employer
Training courses are available online so that employees can and reputation among potential applicants. In addition,
Learning Mileage Recruitment and Retention of Key Talents we established a metaverse recruitment platform in order
pursue learning at the time and place of their choosing.
LG Innotek’s Learning Mileage program was designed to to provide candidates with a positive experience amid the
For DX (Digital Transformation) competency improvement, we Talent Securing and Recruitment
encourage self-initiated learning of employees. Through COVID-19 pandemic situation.
also installed the DX certification system (Levels 1-3). At the LG Innotek performs various recruitment activities to secure talented
this program, which is aimed at suppor ting grow th of
same time, we support DX task implementation by operating individuals with exceptional expertise. We focus on job competency
individual employees and the organization, employees earn
the practice and task-based data analysis course and expert in recruiting and selecting talent, and engage our working-level Key Talent Selection and Management
mileage points as they complete educational courses, obtain
employees in the entire recruitment process. We are also increasing
qualifications, pass language proficiency tests, participate fostering course, etc. LG Innotek is expanding the pool of entrepreneurs and experts
one-demand recruitment for timely hiring of top-notch talent.
in CoP (Community of Practice), and take lectures of internal to lead the Company’s future by discovering and fostering
Leadership Training talented individuals equipped with exceptional capabilities
instructors. Global Talent and potential for growth. We provide customized talent
LDC (Leadership Development Course) LG Innotek hires exceptional R&D talent with master’s and doctoral development program to assist in systematic and continuous
E-Library To assist executives, team leaders, and research/functional degrees and work experiences in the USA, Japan, and other regions growth of individuals by preparing career development and
LG Innotek operates the E-Library for employees. The library, fellows in strengthening their leadership skills, LG Innotek across the globe. We host online and offline recruiting fairs to fostering plans by individual, and organizing 1:1 Care Coaching
accessed with personal mobile devices, computers, and tablets, has provided training on situation-based practice methods discover talent among those with master’s and doctoral degrees from (interview). In addition, key talent competency development is
etc. contains around 63,000 books in diverse categories and solutions since 2014. Different themes are selected each prestigious science and engineering graduate schools, as well as strengthened through the provision of growth opportunities
year, such as member fostering, Care Coaching, conflict employees with past work experience at leading global companies. including job rotation and MBA programs.
ranging from economy and business administration to fictions,
management, and motivation, to help individuals induce actual In Japan, we identify and recruit talented individuals who have served
humanities and history, and science.
as technical advisors to global materials and components companies
behavior change and successfully fulfill their leadership roles. Key Talent Development Courses
based on the country. Our “Global Internship” program for people
Other Education Platforms studying abroad also enables us to expand the pool of global talents. Cover the basics of business and management
Next-generation Leadership Course LG MBA based on the fundamental understanding of
In addition to INNO Smart Learning, an online learning Course
Training is provided for outstanding specialists and professionals Industry-Academia Scholarship Students LG Innotek ’s cus tomer-f irs t philosophy and
platform, LG Innotek provides live programs using Webex and
to help them build leadership competency in advance. This markets, customers, and competitors
Gather Town. LG Innotek hires and fosters talented individuals earlier on for R&D
offers them an opportunity to develop the mindset and positions through a range of programs. In hiring R&D employees Global Nurture next-generation business leaders to take
Employee Training Hours (per person) (Unit: Hour) leadership skills required of leaders by learning about career with master’s and doctoral degrees, we select and develop MBA the initiative and conduct business from a global
development, interpersonal skills, and collaboration based on talented individuals receiving industry-academia scholarship Course perspective
Category 2019 2020 2021
case studies. through the Industry-Academia Cooperation Center along with
Nurture global leaders by helping them develop
Office Worker 64.8 34.4 64.6 relevant university departments and tracks. We also individually Aalto
competency as professional managers to drive
contact target labs working in areas highly relevant to our research MBA
Line Worker 27.9 20.7 28.0 the Company’s evolution into the market-leading
operations at major universities to secure top-notch talent. Course
“No.1 LG” and learn the latest international business
※ Domestic expertise
Industry-Academia Scholarship Students Recruited (Unit: Person)
Category 2019 2020 2021 External Develop talent to lead the Company’s future core
R&D technology areas in consideration of mid- to long-
Industry-Academia Scholarship 20 18 16
Students Recruited
Degree term business/technology directions and business
(in master’s course or higher) Course issues
Recruitment of New Employees LG Head of Develop heads of business units to fundamentally

Business change business structure by discovering business
LG Innotek secures talents as required by adopting the
Unit opportunities to provide innovative experiences to
occasional recruitment system centering on field positions in customers
Course
place of the existing regular recruitment system.
Human Rights Protection Employee training and Engagement Human Rights Assessment Assessment Result and Actions for Improvement
LG Innotek provides all employees with training to prevent LG Innotek engages in regular and ad-hoc due diligence
The regulations for compulsory disclosure of information on
workplace harassment and discrimination that can occur due through signal management, HR audit, labor-management Overview of - Target: 14,437 persons
labor policy, etc. to eradicate unethical issues, such as forced
to “differences” in gender, job position, or disability. survey, and the year-round labor relations management sys- Human Rights - Participation Rate: 100%
labor and child labor, occurring in global corporate supply
For suppliers, we provide labor and human rights training to tem to identify and analyze potential human rights-related Assessment - Target Groups for Labor and Human Rights-relat-
chains are being tightened as of late especially in the USA and
the relevant personnel and managers along with the ESG Risk risks. Risk assessment is conducted on the basis of a checklist in 2021 ed Risk Management: Female employees (3,724),
the EU nations.
assessment. comprising 23 topics and 120 subtopics. It targets domestic general workers and workers without Positions
LG Innotek promotes responsible supply chain management to
worksites and overseas production subsidiaries. In addition, (13,438), employees with disabilities (306)
value human rights of employees in order to resolve human rights our worksites and subsidiaries operate mitigation and preven- - Related Reports: 16
risks in the supply chain, and achieve sustainable management. Internalization Targeting Suppliers tion process to address the vulnerabilities identified through - Handling Completion Rate: 100%
LG Innotek established the Supplier Code of Conduct on the assessment in the areas of discrimination, harassment, and (disciplinary measures taken, training
Compliance with Global Labor Policy KOR ENG basis of the “Responsible Business Alliance (RBA) Code of Con- compliance with working hour limits in accordance with the provided to those at risk of non-compliance on
duct”, and reflected it in the master agreement. PDCA cycle based on audit outcomes. three occasions)
According to the UN Guiding Principles on Business and Human
Since 2016, we have monitored suppliers’ compliance with the For employees identified vulnerable to the infringement of hu-
Rights (UNGP) and the International Labor Organization’s Con-
Code of Conduct by introducing the supplier ESG inspection man rights as a result of an assessment, we administer special Assessment Assessments and preemptive/follow-up manage-
vention on Discrimination in Employment and Occupation, the
process. In addition, our domestic and overseas suppliers con- management to review their potential risks. Our labor-man- Result and ment activities were performed under supervision
standards recognized by the international community, LG Innotek
agement survey, round-the-clock whistle blowing channel, Actions for of labor and human rights-related departments at
established the Global Labor Policy to uphold respect for work- duct annual self-assessment on their ESG system, labor and
and personal performance assessment interviews include Improvement the headquarters, and a labor and human rights
ers and protection of their human rights as the basic value of human rights, health and safety, environment, and corporate
employee grievance interviews to doubly make sure that we in Domestic survey was conducted in 2021 as part of the man-
business. Based on the Global Labor Policy, we manage and ethics. Based on the result, we visit suppliers that require im-
protect human rights of our employees. In 2021, only signal Worksites agement measures.
operate the entire labor and human rights-related processes. provement, and support their improvement activities. management was conducted in a simplified format at overseas
As a result of survey on five domestic worksites
worksites in order to prevent the spread of COVID-19.
The Global Labor Policy is signed by the CEO and externally dis- (Gwangju, Gumi, Magok, Ansan, Paju), cases of
closed on the website. We request our suppliers to also comply Identification and Analysis of Human Rights Risks which damage had been confirmed were ad-
Human Rights Violation Report Process
with the Policy. At the same time, by joining the UN Global Com- dressed through disciplinary measures. In addition,
Online Report Center Activity Cycle Method/Description training for recurrent prevention was provided and
pact (UNGC), we observe the Ten Principles of the UNGC, and
Signal Monthly Checklist-based self-review and due diligence on a campaign for compliance with relevant standards
strive to fulfill the Sustainable Development Goals established To protect employees’ human rights, LG Innotek operates the
Management labor relations management activities by senior
by the UN (UN SDGs). sexual harassment/harassment whistle blowing center. was launched.
management/management supervisors
In addition, human rights protection activities
No employee is discriminated against in terms of their employ- The online whistle blowing center can be accessed from “Report Definition of labor relations actors (head of subsidiary,
are performed as necessary, such as to propose
ment, promotion, compensation, education, and retirement by HR team leader, labor relations staff, organizational
Center” on the Intranet. When an employee submits a report, we
manager) → Define missions and R&Rs by actor → guidelines and conduct guidance and inspection,
reason of gender, religion, race, or age. In addition, all employ- inform him or her of the handling procedures along with the han-
Disseminate and assign roles → Self-review (Q1) → in order to identify legal and systematic changes
ees are given equal opportunities based on their competencies. dling personnel and confidentiality guidelines. With anonymity Monitoring & Feedback → HQ-level due diligence (Q4) and trends, and therefore prevent the occurrence
We strictly ban child labor for children under the age of 15, and guaranteed for whistle blowers, we ensure successful handling HR Audit Yearly Checklist-based due diligence on compliance with of labor and human rights violations.
place restrictions on employment of adolescents aged 18 and of harassment cases by assigning 11 counseling and investiga- labor and human rights standards
under. We also prohibit any form of forced labor that imposes tion personnel (seven male and four female) to each worksite. Plan → Develop survey questions and assessment
method → Collect data → Analysis → Develop Assessment The labor and human rights-related departments
unjustifiable restrictions on the freedom of movement or goes We also receive reports through the half-yearly online sexual ha-
action plan → Implement action plan and monitor Result and at the headquarters have assigned a total of 15
against the will of the employee, as well as intermediary ex- rassment/harassment status survey. Recently, we receive con- implementation Actions for tasks to overseas subsidiaries to improve on vul-
ploitation by subcontractors. sultation on the actions taken from an external agency in order Labor- Yearly Employee survey on organizational culture and Improvement nerabilities. The task progresses and compliance
to enhance fairness and rationality of the corrective measures. Management satisfaction with work environment in Overseas with guidelines are checked monthly.
Human Rights Management Internalization Survey Plan → Develop questions → Collect data → Analysis, Worksites Even after improvement, Care Coaching for
survey → Improvement activity → Check-up
Grievance Handling Status Survey employees, leadership competency improvement
Human Rights Management Governance ※ Targeting all domestic and overseas worksites
Since 2013, LG Innotek’s Junior Board (JB), a consultative body training for organizational managers, and
The ESG Committee is installed under the BOD to supervise
representing office workers, and the labor union have jointly organizational activation program led by head of
and manage if the Company is properly playing its role and Labor and Human Rights Due Diligence Checklist each subsidiary, etc. are provided to strengthen
conducted the annual grievance handling status survey target-
fulfilling responsibilities for human rights. The BOD holds labor relations competency of all overseas
ing employees. Aimed at enhancing awareness of workplace Area Topic
the highest-level responsibility for human rights risks. The worksites.
discrimination and harassment, the survey is used as a channel Recruitment Recruitment process, child/adolescent worker
BOD promotes human rights management establishment by
through which employees’ grievances are received. In 2021, management, retirement policy Key Improvement Tasks
strengthening activities of the ESG Committee and the internal
eight and 16 reports were received through the whistle blow- Contract Employment agreement, fair dismissal 1) Strengthen role of the organization manager as
consultative bodies.
ing center and assessment survey respectively. For all 24 cases, Work Hours Compliance with work hour standards (forced labor), “People Manager”
women and maternity protection, leave/holidays - Target Subsidiaries: China, Indonesia, Poland
corrective measures, such as punishment and guidance, have
Regulations and Process for Guaranteeing Human Rights Promotion Promotion policy
been completed. 2) O perate communication program led by the
LG Innotek prepared internal regulations to guarantee employ- Assessment Assessment criteria and appropriateness head of subsidiary
ees’ human rights, and disclosed the regulations to employees. In Remuneration Social insurance, wage payment, welfare and benefits - Target Subsidiaries: Indonesia, Poland, Mexico
particular, we manage human rights-related risks by establish- Result of Workplace Discrimination and Harassment HR Regulations Recruitment of and welfare for people with disabilities, 3) E stablish Care Coaching interview system for
ing and applying the Code of Ethics and the ESG management Handling (2021) (Unit: Case) employment rules, anti-discrimination, gender-based
employees
discrimination, harassment
regulations. In 2020, we established discrimination and harass- - Target Subsidiaries: Indonesia, Poland, Mexico
Punishment Guidance Total Type of Employment Dispatched and contract workers
ment-related regulations, and opened a reporting channel to 4) D evelop and provide leadership capacity build-
Compensation/ Compensation and disciplinary regulations
ensure swift protection of victims upon occurrence of discrimi- 12 12 24 ing training to organizational managers
Disciplinary Action
nation and harassment cases. Labor Management Labor union formation, labor relations and bargaining,
- T arget Subsidiaries: Vietnam, Indonesia,
For the investigated cases, punishment is decided through the other management issues Poland, Mexico
punishment process.
Human Rights and Labor Assessment on Suppliers Protection of Gender Diversity Protection of Diversity by Region
Special Case Family-friendly Company Certification
The supplier ESG risk assessment is conducted by including LG Innotek aims to create a culture of gender equality to focus As of 2021, 66.3% of LG Innotek employees are Korean nation-
labor and human rights-related items. We conducted due dil- on employees’ expertise and diversity regardless of gender. LG Innotek won the Family-friendly Company als and 33.7% are foreign nationals. The nationalities of our
igence on 16 suppliers in 2021, and continue monitoring their certification from the Ministry of Gender employees vary widely, such as from Chinese to Vietnamese,
We have also been striving to build an environment where
Equality and Family in 2014. In 2021, we Indonesian, Polish, and Mexican.
improvement status. talented female employees can display their full capacities and
were selected as the Best Family-friendly
Assessment Result and Actions for Improvement grow into leaders.
Company. We operate a number of programs
Employees by Nationality (Unit: Person, %)
Category Details As of 2021, 26.5% of our employees are female. The ratio of fe- designed to promote work and life balance,
male managers in domestic worksites is 4.8%, which increased such as to encourage and support childcare Korea 12,403 (66.3)
Target In-house suppliers
by 0.8%p from 2020. leave for both female and male employees, Vietnam 3,555 (19.0)
Period First Half: May, Second Half: November
We are making various efforts to expand the ratio of female reduce work hours during childcare period, China 1,475 (7.9)
Scope and 5 areas and 34 subtopics with respect to unlawful All
implement flex-work system, and provide
Content worker dispatch managers, and continuously foster female leaders. While
maternity leave also to the spouses. 18,717 Indonesia 736 (3.9)
※ 5 assessment areas actively recruiting talented female individuals, we provide a Poland 272 (1.5)
- Has the contractor exercised significant command on range of opportunities for competency building. Mexico 231 (1.2)
supplier’s employees?
In 2022, we will strengthen female leadership by holding a Others 45 (0.2)
- Are supplier’s employees substantially incorporated in Protection of Diversity by Age
the business of the contractor? female leaders’ forum, and strive to develop next-generation
The age group of LG Innotek’s employees varies widely from ※ As of the end of 2021
- Does supplier independently exercise its decision-mak- female leaders by launching a mentoring program. ※ The 12,415 domestic employees include 12 foreign nationals.
ing rights on personnel matters and absenteeism? the 20s to over 50s. To ensure mutual understanding and com-
Therefore, the figure differs from that of Korean nationals.
- Does supplier have expertise and technical competency munication between generations, LG Innotek provides reverse
for its business? Employees by Gender (Unit: Person, %)
mentoring program through which new employees provide
- Does supplier have independent corporate organization
mentoring to executives. Expanding Employment of People with Disabilities
and facilities?
Female The program was implemented targeting senior management
Result and Although no major risk of illegal worker dispatch was found, Female Employment of People with Disabilities
Corrective improvement action was taken on six suppliers that did not 2,584 Domestic in 2020. In 2021, the scope of mentees was expanded to in-
4,951 clude team managers. LG Innotek has been dedicated to the employment of people
Measures change employment rules with respect to the maternity (20.8%) 12,415
protection-related amendment of the Labor Standard (26.5%) with disabilities. Recruitment of people with disabilities is ar-
Act (parental and childcare leave for spouse). In addition, ranged in connection with local special education institutions,
Training to prevent the risk of illegal worker dispatch was
Male and additional points are given to applicants with disabilities
provided to employees who are in a close business relation-
ship with suppliers. Also, improvement implementation and 9,831 in the paper-based screening process. Furthermore, we dis-
standard compliance have been inspected. All (79.2%) cover work areas that are suitable for people with disabilities,
and operate production lines designed exclusively for them.
18,717
Diversity and Inclusiveness * Reverse Mentoring Subsidiary for Inclusive Employment
Female
In May 2012, LG Innotek established the subsidiary, “Inno-With”,
LG Innotek aims to create an organizational culture where all 2,367 Overseas
Employees by Age (Unit: Person, %) as a standard worksite for people with disabilities. The company
employees accept and respect each other’s differences. We can (37.6%) 6,302
provides cleaning, sales, and production support services, and
provide better products and services to customers when our em- Male
approximately 69% of its workforce consists of people with
ployees share diverse opinions and ideas, and unleash their po- 13,766 50 years of age and older disabilities.
tential. We strive to create an environment where all employees Male
(73.5%) 760 (4.0%) In addition, each of our worksites is equipped with a range of
can display their full potential regardless of gender, race, age, 3,935
(62.4%) All Under 30 years amenities and working conditions to support employees with
value, and preferences.
※ As of the end of 2021 30 years of age
and older-under
18,717 of age disabilities.
Ban on Workplace Discrimination KOR ENG 8,080 (43.2%)
50 years of age
The Global Labor Policy (Article 5) bans discrimination of em- 9,877 (52.8%) Employment of People with Disabilities (Unit: Person, %)
ployees by reason of differences in gender, race, age, value, Strengthening Childcare Support System Employment Rate
and preferences, etc. in terms of their employment, wage, pro- To alleviate employees’ burden in taking parental leave, Employees with
motion, compensation, training, and retirement. It stipulates LG Innotek improved the performance assessment system to 2.8 2.8 2.8 Disabilities
the handling of violations on the basis of the principle of zero 50 years of 50 years of age
grant an over-the-average salary grade to employees taking 306
age and older and older
tolerance. parental leave for three months and longer. We also facilitate 270
670 (5.4%) 90 (1.4%) 250
the use of reduced work hours system so that our employees
Internalization Targeting Employees Domestic Overseas
do not suffer career discontinuation while caring for their chil-
Training for Sexual Harassment/Harassment Prevention dren. At the same time, we introduced the “One-click Parental 12,415 6,302
30 years of 30 years of
LG Innotek provides training to prevent workplace harassment Leave” program so that our employees can conveniently apply age and older-
age and older-
and discrimination to all employees. for both maternity and parental leave at once. under 50 years under 50 years
2019 2020 2021
of age of age
Childcare centers offering high-quality service and safe envi- Under Under
7,336 (59.1%) 2,541 (40.3%) ※ Domestic
100 %
Training to ronment are operated to reduce employees’ burden for child- 30 years 30 years ※ Sum of employees at LG Innotek and its subsidiary, Inno-With, a stan-
Sexual Workplace
Improve Aware- care and help them achieve work and life balance. of age of age dard worksite for people with disabilities
Harassment Harassment
Prevention Prevention
ness of People Completed by 4,409 (35.5%) 3,671 (58.3%) ※ Employees with Disabilities: The data were calculated by combining
with Disabilities in the number of employees with mild and severe disabilities. One
Training Training all employees
Workplace employee with severe disabilities counts as two employees with mild
※ As of the end of 2021 disabilities.
Labor-Management Cooperation and USR USR (Union Social Responsibility) Field Innovation Activities Including USR Innovation Line Support for Veterans’ Families and People with
Since 2013, a project to build field competitiveness has been Disabilities
LG is committed to creating a joint value for workers and man- Union Social Responsibility (USR) represents the forward-looking implemented under the leadership of labor union executives to The labor union held the “Share Love with Veterans’ Families”
agement based on mutual respect and trust by eradicating initiative undertaken by LG Innotek labor union to fulfill its propose ideas on quality and productivity improvement, and event at the four worksites in Gumi, Paju, Pyeongtaek, and
the confronting and vertical labor-management relationship. responsibilities as a member of the society by joining forces put the ideas into action. LG Innotek operates the USR Inno- Gwangju in commemoration of the Memorial Month of June.
LG Innotek recognizes the importance of stable and harmoni- in advancing the rights and interests of union members and vation Line incentive program to elevate the innovation-driven This event was organized to pay tribute to those who sacrificed
ous labor-management relationship based on trust built over resolving social issues through transparent and ethical union mindset, and encourage competition in good faith among their lives for the nation and help their families facing financial
a long period. activities. LG Innotek labor union declared its commitment to union branches to improve their execution capabilities. In difficulties. Since 2012, LG Innotek has extended gratitude to
USR in 2012 and has since launched a range of programs. 2021, a total of four innovation tasks were implemented, which
We uphold the freedom of association and collective bargaining more than 5,000 veterans’ families by repairing their houses,
across all worksites, guarantee the right to form labor unions USR Introductory Video (YouTube) led to improving profitability by KRW 19 billion. installing eco-friendly lighting devices, hosting music concerts,
and representative bodies, and respect the rights of employees offering cultural experiences, and lending a helping hand in
Support for Small Businesses and Medical Personnel Worksite Business Unit Improvement Activities
to join labor union. the farming communities, etc. In 2021, we delivered rice and
In 2021, LG Innotek performed activities to help small businesses Gwangju Automotive Improvement Activities Secure max.
Cooperation and free flowing dialog between labor and man- daily supplies to veterans’ families suffering difficulties due to
suffering difficulties due to sales drop caused by COVID-19, such Components capacity through *SMT productivity
agement has made dispute-free agreements possible since COVID-19.
as to donate home appliances and order meals to small restau- improvement activity
1991, setting an example in labor relations for other companies.
rants in Gumi, Gwangju, and Pyeongtaek where the worksites Gumi Optics Achieve extreme yield for key production Since 2012, we have supported students with disabilities
The Labor-Management Council serves as a communication
are based. Solution models in 2021 though innovation activity through engagement activities (cultural experiences, field trips
channel in improving our corporate competitiveness and the
to LG Innotek worksites, and career counseling) and donation
quality of life for our employees. It also plays the role in engaging In particular, we selected 13 restaurants that experienced Substrate and Implement advanced quality improvement
Material for 16L **SiP Hornet activities (scholarships, electronic devices, school uniforms,
employees in business operations. serious damage since the COVID-19 proliferation, and supported
and meal expenses) in accordance with the agreement signed
them through “Matching Donation” to deliver food from each Pyeong- Automotive Improve productivity of
with special education institutes in the vicinity of our worksites
restaurant to the vulnerable class in respective areas. Through taek Components ***TAS 6Line (NX4 TAS)
Labor Relations Governance and the Korea Employment Agency for the Disabled. We have
Gumi Social Welfare Center, Gwangju Notre Dame Brother’s * SMT: Surface Mount Technology
As of 2021, LG Innotek labor union comprises 3,522 members also been focusing on providing practical assistance to these
House, and Osan City, we delivered food to approximately 1,000 ** SiP: System in Package
at three branches across the country (Gwangju, Gumi, Pyeo- *** TAS: Torque Angle Sensor students by helping them to become viable members of the
people including senior citizens living alone and the disabled. In
ngtaek). The Company guarantees autonomy in the union op- society, and therefore realize their dreams by offering voca-
addition, we donated home appliances, such as TVs and air condi-
eration, and constantly interacts with it in relation to working Industrial Accident Prevention Activities tional experiences and recruiting talented students since 2017.
tioners, to small businesses.
conditions. In addition, we have provided financial support for medical
To prevent industrial accidents, health and safety training is
Moreover, air conditioners, refrigerators, and light wave ovens expenses of children and teenagers with disabilities from low-
In introducing or changing a system, we collect feedbacks provided at least once a month to union members by union
were installed in the staff lounges for the medical personnel income families in alignment with the Severance Hospital.
in advance and fully reflect them in our business conduct to leadership. The program is followed by EESH (Energy, Envi-
and staff working at local health centers and hospitals in Gumi,
maintain and develop the labor-management culture promot- ronment, Safety, and Health) patrols performed at worksites
Gwangju, and Pyeongtaek, the areas where our worksites are
ing win-win partnership. to prevent internal environmental risk factors. For the insuffi-
located, and medical supplies, such as face masks, sterilized
The Labor-Management Council comprising senior manage- ciencies identified, solutions are developed through the field
gloves, and contactless thermometers, were donated.
ment including the CEO and union representatives including management supervisors and safety and environment staff.
the union chairperson holds quarterly meetings to share man- Through these activities, we are building safe workplace and
COVID-19 Response
agement performances and discuss items on improvement of disseminate safety culture across all worksites.
To contribute to preventing COVID-19 spread in local commu-
wage and welfare and benefits as well as handling of grievances.
nities, the four worksites in Gumi, Gwangju, Pyeongtaek, and
Collective bargaining agreements are reached on an annual
Paju performed internal diseases prevention activities. Ap-
basis.
proximately 900 employees including and labor union execu- * Donation to Families of War Veterans
Through the Junior Board (JB), a consultative body of office
tives and line workers joined in the effort. Groups of 20-80 mem-
workers, senior management and representatives of office
bers were organized at each worksite to perform the activities
workers hold regular meetings to discuss HR system and
once a week. Following the activities and safety training, union
working conditions for office workers.
members disinfected communal areas at the worksites (staff
lounges, lobbies, cafeterias, and restrooms, etc.) to join in the
Labor Labor Union Labor-Management local communities’ effort to overcome the pandemic. * USR EESH Patrol
Union Members Membership Rate Council Meeting
3,522 persons 44% (domestic) Quarterly
※ As of December 2021
*Disease Prevention at Worksite in Response to COVID-19

Supplier ESG
The demand for shared growth with suppliers from customers and
external stakeholders as well as according to the domestic and
international laws and regulations for sustainable development is
intensifying. Under the circumstances, LG Innotek established the
vision of “Right Promise, Better Tomorrow, Partnering with Suppliers
to Become a Market Leader.” Shared Growth Policy
We aim to establish a sustainable system and control risks in the
supply chain by promoting various supplier support and cooperation
Right Promise, Better Tomorrow
activities, and applying ESG management throughout the supply Vision
chain for selection, assessment, and management of suppliers. Partnering with suppliers to become a market leader
Strengthen Build Produce

Competency Trust Outcomes
·S
upport development of key suppliers · Activate open communication · Strengthen open innovation
·S
upport management · Introduce and operate the four guidelines ·C ollaborate on performance-driven
competency bolstering proposed by the Fair Trade Commission projects
·S
upport competency building of · Establish shared growth infrastructure for ·P articipate in government-sponsored
suppliers’ employees Tier 2 and Tier 3 suppliers projects and protect technology
Win-Win Growth Index ESG Risk Assessment of Suppliers
Highest rating for 5 years in a row 301companies

Selected as Best Honorary Company
Support through Shared Growth Fund Educational Support for Suppliers
KRW 64.5billion executed 212companies, 402courses

Fund raised by KRW 103 billion
Sustainable Supply Chain Management Supply Chain
LG Innotek purchases raw materials to a scale of approximately KRW 10.9 trillion a year from 774 suppliers in around 30 countries.
Supply Chain Management System Supply Chain Management Process
We discover and secure competitive local suppliers in each country by operating the IPO (International Procurement Office) in China,
Integrated Supply Chain Management Supplier Selection Taiwan, and Japan. We also receive new ideas from suppliers, and review them for new technology and technique application.
LG Innotek established a supply chain management portal to The competitiveness of suppliers is assessed in terms of
strengthen supply chain infrastructure, and continue practicing technology, quality, business management, compliance, and Purchase Amount by Region (Unit: KRW 100 million) Local Sourcing Ratio (Unit: %)
change management to better respond to customer needs. environmental management, and also for their conformance
We build mutual trust with our suppliers by creating a virtuous to the sustainability items. Suppliers that fail to meet the criteria Region 2019 2020 2021 2019 2020 2021
36.3
cycle of transparent information sharing among R&D, procure- are excluded from the transaction target. Once registered, the Total 54,725 68,306 108,948
ment, production, marketing, and other business domains, selected suppliers sign the pledge to comply with the Supplier 33.1 28.7
Domestic 36,710 48,098 74,164
and supply activation, etc. Code of Conduct to enter into the Master Procurement Agree-
Overseas 18,015 20,208 34,784 ※ Based on transactions by overseas subsidiaries
ment, fulfill social responsibilities, and ban the use of conflict
minerals, etc. Vietnam 12,360 14,455 26,819
Global Procurement Policy China 3,266 3,434 5,279 Raw Material Origin Tracing Rate (Unit: Item, %)
LG Innotek established the global procurement policy as the
Indonesia 1,335 1,379 1,570
basic rule to be followed in procurement operations. Stipu- Supplier Evaluation Target Items Tracing Rate
Poland 320 624 789
2,566 99.4%
lating the procurement operation-related procedures and Following supplier registration, the supplier is assessed regularly
standards, the policy comprises 45 clauses in 11 sections. The once every six months, and the result is reflected in the future Mexico 58 128 327
policy is distributed to the procurement staff at all levels to en- operation strategies. Others 676 188 -
hance their understanding of the operations. It is also used as
※ The LED business that was discontinued in 2020 was classified as “Others.” ※ As of December 2021
the standard for the execution of fair and transparent procure- Target Suppliers with monthly average raw material
ment operations. transaction amount of KRW 30 million or more
ESG in the Supply Chain

Supplier Code of Conduct Establishment and Operation Method Scoring for each of seven areas
(T, Q, R, D, C, M, E) (out of 100 points) ESG Risk Assessment in Supply Chain
LG Innotek established the Supplier Code of Conduct based
* TQRDCME: Technology, Quality, Responsiveness,
on the “Responsible Business Alliance (RBA) Code of Conduct”, Self-assessment and On-site Review
Delivery, Cost, Management, Environment
and urges suppliers to perform sustainable management LG Innotek defines suppliers with monthly average transaction amount of KRW 30 million or more as key suppliers, and conducts
activities. We request that our suppliers fulfill their respon- the supplier ESG assessment once a year on these suppliers. We recommend our suppliers to internally examine their level of
sibilities by creating a safe work environment, performing Rating Five ratings (S, A, B, C, D)
management in the fields of labor and human rights, ethics, health and safety, environment, and operating system, and promote
social, environmental, and ethical management activities, and improvement in relation to the issues identified through the assessment. Considering the assessment result and purchase impacts,
respecting dignity of their employees. This is reflected in the we visit and provide suppliers that are in need of support with consulting service to help them enhance their ESG level.
Application 1) Outstanding supplier: Grand precedence in
trade agreements so that suppliers satisfy such requests in their
of Result development and volume allocation
business operations. 2) S upplier failed to meet the set criteria: Supplier ESG Assessment Process and Result Management Supplier ESG Assessment Result (2021) (Unit: Point)
LG Innotek Supplier Code of Conduct Consider imposing restrictions in new
development Environment
Pledges Signed to the Supplier (Unit: %) 91
Code of Conduct
Feedback
91 94
on Result
Operating Health and
Domestic System Safety
Overseas Self-
Self-
Assessment Improvement
100 %
Step 1
85% Self-assessment 92
Ethics
98
Labor and
Human Rights
Step 2
Support through Visit Companies Assessed (Unit: Company, %)
Checking
On-site
Improvement Category 2019 2020 2021
※ As of December 2021 Assessment
Result
All Suppliers 921 843 774
Self-examination 336 75 301
Improvement
On-site Consulting 22 - -
Self-examination Rate 36% 9% 39%
※ In 2020 and 2021, on-site consulting was not provided due to COVID-19.
History of ESG Management in Supply Chain Responsible Sourcing Spreading ESG Management
Establishing Basis for ESG Management
2013 2014 2016 2017 LG Innotek To establish the basis for ESG management in suppliers, and
therefore spread sustainable management, we provide online
* Identify conflict ESG training and educational materials to the employees of
minerals regulatory
the Tier 1 and Tier 2 suppliers. We are expanding the scope of
trend and
cooperation by entering into the fair trade and shared growth
requirements
· Established Supplier Code · Operated CSR Clinic: · Expanded supplier CSR · Expanded supplier CSR agreement with not only our Tier 1 suppliers, but also around
of Conduct 4 suppliers assessment assessment 50 Tier 2 and Tier 3 suppliers.
Establish
· Included Code of Conduct -S
elf-assessment: 50 suppliers - Self-assessment: 206 suppliers
Smelters procurement policy
in agreement - On-site Assessment: 5 suppliers - On-site Assessment: 18 suppliers Environmental Support for Suppliers
and Suppliers and response plan Customers
- Master Procurement · Regular assessment · Introduced CSR assessment for LG Innotek suggests the direction to suppliers for response by
Refineries
- Introduced CSR items
Agreement new suppliers providing training program on the global regulatory trend and
- Self-assessment, partial on-site Investigate accident cases concerning the use of environmentally hazardous
assessment status of conflict
substances in components, etc. To support energy-related
minerals use
※ Including in-house suppliers activities of our suppliers, we are examining suppliers’ energy
consumptions, and discovering and implementing tasks to
2018 2019 2020 Manage risks
reduce consumption by participating in the Energy Cooperation
Program led by Korea Energy Agency.
* Conflict Minerals: Minerals causing conflict for which forced labor occurs
frequently in the course of mining, and that is used to finance wars
· Expanded supplier CSR assessment · Regularized supplier CSR assessment · Improved supplier assessment
- Self-assessment: 427 suppliers questionnaire
- Self-assessment: 336 suppliers
- Revised to supplier ESG assessment To join in the international effort to ban the use of the 3TG
- On-site assessment: 37 suppliers - On-site assessment: 22 suppliers
-S elf-assessment: 75 suppliers (tantalum, tin, tungsten, gold), the conflict minerals, LG Innotek
· Regular assessment · Regular assessment established conflict minerals policies, management criteria,
(scale-downed due to COVID-19)
- Tightened point deduction criteria - Improved checklist and procedures in compliance with the standard required by
· Revised the Code of Conduct the RMI (Responsible Minerals Initiative). According to the
criteria, etc. we survey the status of smelter and refinery use * ESG Educational Material for Suppliers
by the related suppliers using the CMRT (Conflict Minerals

Reporting Template), and manage the supply chain to ensure
suppliers’ compliance with the RMAP (Responsible Minerals
2021 2022 (Plan)
Assurance Process) In keeping pace with the expanded scope
of conflict minerals, we also manage the use of cobalt and
mica in addition to the 3TG. Going forward, we will keep a
close eye on the related trends through various communication
channels including customers, professional institutes, and
· Advanced supplier ESG assessment · Continue supporting self-assessment consultative bodies of subsidiaries, and continue cooperating
- Self-assessment: 301 suppliers · Provide ESG management consulting with our suppliers for regulatory compliance.
· Revised Supplier Code of Conduct - 20 suppliers
(through cooperation with
Investigation on the Use of Conflict Minerals (Unit: Supplier) * Participation in Energy Cooperation Program
professional institutes)
Category Suppliers Smelters and Refineries
Survey through the CMRT 317 242
(Conflict Minerals
Reporting Template)
Survey through the CRT 121 39
(Cobalt Reporting
Template)
※ As of May 2022
Shared Growth with Suppliers HR and Welfare Support Communication Improvement

LG Innotek provides a wide range of online and offline edu- LG Innotek promotes substantial shared growth activities
LG Innotek performs various activities for shared growth with suppliers in the areas of technology, finance, management, HR,
cational courses led by professional educational institutes by through open communication by building mutual trust with
welfare, and communication improvement. We ensure fast and accurate communication regarding inquiries and suggestions from
reflecting supplier needs to help suppliers strengthen their suppliers through online and offline communication channels,
suppliers by installing an online whistle blowing channel, which is a grievance report system, and an online communication channel
capabilities. We also provide our suppliers with an opportunity and securing transparency in transactions based on information
in the procurement portal.
to attend job fairs along with financial assistance to help them sharing.
In addition, we regularly visit our Tier 1 and Tier 2 suppliers to check their shared growth and trade-related satisfaction, and
secure outstanding talents. In addition, the Welfare Mall for
promote improvement on the issues identified. For customized communication by business unit, our top
LG Innotek employees is open to the employees of suppliers,
management visits suppliers through the “Shared Growth
Shared Growth Support Projects enabling them to access welfare benefits.
Camp”program to collect and reflect suppliers’ opinions in
shared growth activities. To ensure communication with a
Fair Trade Financial Support Technological Support and Protection
greater number of suppliers, we also hold the “Shared Growth
· Introduce and operate the four guidelines · Shared Growth Fund · Consulting for Innovative Partnership Talk” with the management of approximately 100 main suppliers.
proposed by the Fair Trade Commission · Network Loan · Establish Smart Factory
· Fair trade agreement · Shared Growth Payment system · Joint innovation activities
(Between Tier 1 and Tier 2 suppliers, · Provide convenience for payment to (quality, productivity, localization) Communication Activities
between Tier 2 and Tier 3 suppliers) subcontractors · Develop new products under condition of
Program Frequency
· Standard subcontracting agreement of (three times monthly, payment in cash) purchase
the Fair Trade Commission · Technology Escrow System VOC operation on procurement portal Year-round
(Between Tier 1 and Tier 2 suppliers, Online whistle blowing channel for suppliers Year-round
between Tier 2 and Tier 3 suppliers)
· Online whistle blowing channel Jeong-Do Management survey on suppliers Once a year
* Training Website for Suppliers Shared Growth Talk (Shared Growth Camp) Quarterly
Talent Fostering Management Support Communication Improvement Shared Growth Academy Yearly
· Online training (job training, language, · ESG consulting for suppliers · Operate Consignees Council (Educational Program for CEO, talk session)
Educational Support to Suppliers in 2021 (Unit: Course,
business administration, etc.) · Support participation in exhibitions (Targeting Tier 1 suppliers, operation Supplier, Person)
· Offline training · Performance sharing system support between Tier 1 and Tier 2 suppliers)
(6 Sigma, quality training, etc.) · Business Doctor system · Shared Growth Academy No. of Participating
Type Course Participants
· Customized on-site training · Energy Cooperation Program · Shared Growth Camp Courses Suppliers
· Support participation in job fair · Welfare support · Shared Growth Newsletter
Online Competency building training 365 154 1,186
(Job training, business
administration, language,
Support Activities by Area self-development, etc.)
Offline Job training 15 21
Financial Support Technological Support
and technology education
LG Innotek makes full cash payments to suppliers to facilitate LG Innotek hosts the “Supplier Tech Fair” as a venue for suppliers
Quality and productivity 22 54
their financing, and has shortened the payment period to ten to share their new technologies and products so that they can 37
improvement
days with three book closing dates per month. In addition, we tap into wider markets, and also performs innovation activities * Partners' Day (Feb. 2022)
Core Skills and job compe- 21 44
operate the Shared Growth Fund to provide suppliers with low each year for joint technology development with suppliers.
tency training by job position
interest rate loans for use in their business operations. Four subcommittees are operated throughout the year by
The scale of the fund was expanded to KRW 103 billion. As of Total 402 212 1,305
supplier business type to help suppliers build capacities based
2021, we provided KRW 64.5 billion in funding to 40 suppliers. on their own technologies. The committees are contributing
We also made a network loan agreement with the Industrial to not only increasing sales of suppliers through sharing of
Management Support
Bank of Korea to allow our suppliers to take out loans for financ- LG Innotek’s productivity innovation expertise, localization of
materials and components of which the level of dependence LG Innotek’s “Business Doctor” program is an on-site consulting
ing business operations based on their performance of supply
to LG Innotek. Since 2015, the Shared Growth Payment system on import is high, and development of new products, but also service provided by a group of advisors from the Federation
has been under operation to help Tier 2 suppliers receive their LG Innotek’s productivity and quality innovation, and therefore of Korean Industries to help suppliers address their business
due payments and secure liquidity. In 2021, we paid KRW cost reduction. difficulties and elevate their competitiveness. This program is
1,625.7 billion to suppliers through this system so that Tier 2 We are also building Smart Factories for shared growth and recognized as a successful shared growth model as it enables
* Shared Growth Camp (Jun. 2022)
suppliers can stably collect their payments from Tier 2 suppli- supporting the Innovative Partnership project under the goal our suppliers to improve their business environment and secure
ers. As a result, KRW 39.8 billion was paid to Tier 2 suppliers. to help suppliers bolster their competencies in manufacturing a foundation for growth, while providing LG Innotek with an
sites. We are supporting building the automated smart facto- opportunity for quality improvement.
ries by providing LG Innotek production technology-related
Shared
103
personnel.
Growth Fund
KRW billion The Innovative Partnership program is operated concurrently
with professional consulting service with a goal to improve
productivity of suppliers, and activate export. In 2021, we imple-
Technological
Support 15 tasks 5 suppliers
mented 15 tasks targeting five suppliers, and supported suppli-
ers’ field improvement. In addition, we support the technology
Activity escrow program and the certification of original documents on
trade secrets to help our suppliers safeguard their critical tech-
※ Based on 2021 nologies and trade secrets and provide all affiliated expenses.
Social Contribution
In fulfilling social responsibilities, LG Innotek is strengthening
cooperative relationships with local communities by selecting
and promoting to achieve “Quality Education” and “No Poverty”
among the UN Sustainable Development Goals (UN SDGs), and
“Partnerships For the Goals” with a range of related organizations
and groups in Korea and abroad.
To provide quality education to the neglected class, we gradually
expand investment in the “Junior Pine Tree Class.” In addition,
we are committed to increasing positive influence on the global
society by consistently performing various sharing activities
based on integrated directions.
UN Sustainable Development Goals (UN SDGs)
Social Contribution Support to Local

Investments Communities
KRW 4.17billion KRW 4.45billion
Employees’ Volunteer Beneficiaries

Service Hours (domestic)
3,351hours 18,258 persons

Social Contribution System

LG Innotek performs various social contribution activities in order to contribute to local communities. We are striving to communicate Social Contribution Portal
and coexist with local communities by supporting the dreams of children and teenagers, and sharing warmth with the neglected LG Innotek established the social contribution portal in order to
neighbors. We are committed to becoming a company that fulfills its social responsibilities by keeping an eye on social issues, and strengthen corporate social responsibility, and provide a bet-
participating in activities to address them in a long-term perspective. ter environment for employee engagement. By digitalizing do-
nation and volunteer service participation process through the
portal, we expanded opportunities for our employees’ partic-
Social Contribution Promotion System
ipation in social contribution by enhancing their access to and
Under the vision, “Creating Contentment through Nurturing and Sharing”, LG Innotek performs systematic social contribution activities convenience of social contribution activities. While sharing the
by beneficiary group. related news through the portal, we transparently disclose the
The program is promoted under the two keywords of “Kium-Nurturing” and “Nanum-Sharing”, and the three principles of “Benefi- fund raising and execution details to improve employees’ trust.
ciary-centeredness”, “Continuity”, and “Voluntary employee engagement.”
“Junior Pine Tree Class” for “Kium” targeting children and teenagers, and “Good Neighbor Plus” for “Nanum” targeting local com- * Materials and Components Science Class
munities are LG Innotek’s representative social contribution programs.

Career Path Coaching Program
Vision Creating Contentment through Nurturing and Sharing LG Innotek has been operating a career path coaching pro-
gram since 2020 in order to help teenagers nurture their
Kium (Nurturing) Nanum (Sharing) dreams and hopes for the future by exploring career options.
This program is operated through talent donation by LG Group
employees who are qualified for professional career path
Program
coaching. We provided the career path coaching to 47 children
in 2021, and plan to provide the service to 50 children in 2022.
Principles Beneficiary-centeredness Continuity Voluntary employee engagement
* Main Page of Social Contribution Portal

Social Contribution Programs
Junior Pine Tree Class (Kium-Nurturing)
Employee Engagement To help children and teenagers nurture their dreams and hopes,
* Career Path Coaching Program
Hope-Sharing Fund LG Innotek operates Materials and Components Science Class, Learning Environment Improvement
career path coaching program, and learning environment im-
The Hope-Sharing Fund is a social contribution fund raised by Employee Volunteering After-school Academy facilities with inferior environment are
provement project through cooperation with local children’s
employees’ voluntary participation. LG Innotek employees can selected for classroom and hallway remodeling. Also, the neces-
To ensure consistency in volunteer activities performed by centers around worksites.
participate in the program by opening as many accounts as sary educational equipment and materials are supported.
each worksite, LG Innotek performs volunteer activities by
they desire (KRW 1,000/month), or donating a portion of their In 2021, remodeling work was conducted in ten centers, and
designating the quarterly “Inno Dream Day.”
monthly wages or bonuses in an amount less than KRW 1,000. Our educational equipment and materials were provided to 13 local
executives participate in the “One + One” system to donate a Since 2020, the activities have been performed contactlessly children’s centers to create a more pleasant learning environ-
due to COVID-19. In 2021, we further increased the opportu- ment to children and teenagers.
designated amount from their base salary each month.
nities for contactless voluntary service, and delivered trans- Investment
The Company additionally donates in an amount twice that Other Supporting Activities
parent umbrellas, pop-up books, and block pencil cases our
raised by employees. The raised fund is used as a financial 2021 (Executed) 2022 (Planned)
employees made to the socially vulnerable class. Having established sisterhood ties with the Second Armored
source for social contribution activities.
KRW 700 million KRW 760 million Brigade in Paju in 2012 under the “One Company One Barrack”
program, LG Innotek has been annually providing essential
Employees Contributing to the items needed for their military life. In 2021, we donated dryers
Hope-Sharing Fund
(as of Apr. 2022)
74 % Material and Component Science Class and thermometers. We will continue performing the activity in
2022 to provide substantial assistance to the servicemen and
Materials and Components Science Class is a talent donation
women.
Amount of Employee Contributions to program designed based on the characteristics of LG Innotek’s
the Hope-Sharing Fund
(as of 2021)
KRW 320 million business areas. Under guidance of LG Innotek employees,
teenagers learn the technological principles applied to mate-
rials and components, and engage in hands-on experiences
Employees Participating using experiment kits. Since 2011, we have been operating the
in Volunteer Service
(as of 2021)
1,117 persons Science Class targeting teenagers from the neglected class for
whom educational opportunities other than standard school
* Gumi Worksite Delivering Transparent Umbrellas for Children’s Safety education are limited. In 2021, 2,113 teenagers participated in
the “After-school Academy.” In 2022, we plan to increase the
number of participants to around 3,000. * Donation to the Second Armored Brigade in Paju
Good Neighbor Plus (Nanum-Sharing) Support for People with Disabilities Global Social Contribution
LG Innotek is committed to creating opportunities for building LG Innotek improves the environment of special education LG Innotek strengthens solidarity and communication with global society by performing a wide range of social contribution activities
solidarity and communicating with local communities by sup- institutions and facilities, and supports them with cultural catered to the specific needs of local communities where the Company’s overseas production subsidiaries are located.
porting the underprivileged families and people with disabilities, experiences, educational activities, and rehabilitation. In 2021,
and providing necessary assistance in the areas by worksite. we donated home appliances along with the COVID-19 disease
Yantai, China Wroclaw, Poland
prevention items to improve welfare of people with disabilities.
In 2021, with the effort for continuous sharing recognized, The Yantai subsidiary, partnering with the local government, The Polish subsidiary in Wroclaw performs a range of sharing
We also provided learning supplies including laptop computers,
Magok, Gumi, Gwangju, and Pyeongtaek worksites were donated disease prevention items to the COVID-19 quarantine activities targeting local communities through employees’ par-
and educational materials.
selected as Local Community Contributors. Magok worksite, personnel. Each year, the subsidiary donates home appli- ticipation. On the Christmas Eve in 2021, the subsidiary deliv-
in addition, won the Minister of Health and Welfare Citation ances, such as refrigerators and electric cookers, and other ered gifts to children with disabilities. It also donated items to
Support for Local Communities
(implementation category) by sponsoring a nearby welfare necessary items to a social welfare center in Yantai Developing a local animal shelter. In 2022, learning supplies and uniforms
center for the disabled for over four years. LG Innotek performs activities for local economy revitaliza- were purchased and donated to provide educational support
District as part of its local community contribution activities.
tion. Gwangju and Gumi worksites established sisterhood to the Ukrainian teenagers that settled down in Świdnica.
ties through the “One Company One Village” program with
Goseo-myeon, Damyang-gun in Jeollanam-do and Cheong-
san-ri, Euiseong-gun in Gyeongsangbuk-do respectively, and
have been performing environmental clean-ups and offering
a helping hand during the busy farming season. We also
Investment
entered into social contribution agreements starting with
2021 (Executed) 2022 (Planned) Sinpyeong-dong, Gumi-si in 2019, and then with Hanam-dong,
2.68 billion 5.51billion

Gwangsan-gu in Gwangju Metropolitan City and Jinwi-myeon,
KRW KRW Pyeongtaek-si in 2020 to strengthen mutually beneficial coop-
eration with local communities.
Support for the Underprivileged Support for Addressing Social Issues

Based on cooperative relationships with institutions near LG Innotek participates in addressing key social issues by mak-
domestic worksites, LG Innotek practices sharing with low-in- ing regular donations to the Community Chest of Korea. In
come families, families of war veterans, families of North Korean 2020, we made a special donation for recovery from damages
defectors, and seniors residing alone. We are sharing warmth caused by COVID-19 and torrential downpour. In March 2022,
with local communities by supporting the Family Month events we also made contributions to the forest fire-affected region
as well as sharing Samgyetang, hot chicken soup with ginseng, in Gangwon-do.

* Donation of COVID-19 Disease Prevention Items to Yantai Developing District * Christmas Gift Donation to Children with Disabilities in Wroclaw
in summer, Songpyeon, traditional Korean rice cake, during
Chuseok holidays, and Kimchi in winter.
Haiphong, Vietnam Jakarta, Indonesia
In 2021, with the COVID-19 pandemic aggravating in Viet- The Jakarta subsidiary visited Majalengka, an area affected by
nam, the Haiphong subsidiary participated in the COVID-19 the damage of heavy rain, flood, and landslide, and provided
response activities through cooperation with the local com- support in damage recovery and donated the necessary items.
munity. The subsidiary donated KRW 250 million to the vaccine It also organized the Idul Adah holiday event together with the
fund raised by Haiphong City, and provided around 5,000 local community. The subsidiary will continue performing so-
masks, disinfectants, and COVID-19 diagnosis kits to Haiphong cial contribution activities in local communities where support
Economic Zone Authority. Computers and TVs worth KRW 10 is needed.
million were also donated to a secondary school with poor ed-
ucational environment in Haiphong City.
* Donation to Families of War Veterans
* COVID-19 Vaccine Fund Donation to Haiphong City * Support for Recovery from Flood Damage in Majalengka
(KRW 1.5 Billion Raised by LG Group Subsidiaries and Suppliers)
* Support for Local Welfare Center Event on Parents’ Day

Governance
With responsible investment based on ESG internalization becoming a universal
trend and global financial institutions recognizing ESG as the future value of
businesses, transparent ESG information disclosure is required.
With the government promoting compulsory ESG information disclosure
from 2025, non-financial information disclosure has been established as an
essential element. Accordingly, LG Innotek aims to establish sound governance
by securing the independence and expertise of the Board of Directors (BOD)
to ensure transparent information disclosure and establishing subcommittees
as well as an audit body within the BOD.
Key Performances (2021-2022)
Garnered a Grade A Separated

in Corporate Governance the BOD Chairperson
Assessment from CEO (March 2022)
ESG assessment by KCGS
(Korea Corporate Governance Service) in 2021
Established Subcommittees Dividend

under the BOD 2020 2021 Compared to the
previous year
ESG Committee (April 2021)
KRW 16.6 KRW 71 increased by
4times
Internal Transaction Committee (July 2021)
billion billion
Dividend Payout Ratio as of Appointed *CRO and Established

Fiscal Year 2021 Dedicated Organization
8.0% (June 2021)
Disclosed dividend policy and maintain * CRO: Chief Risk Officer

a dividend payout ratio of 10% or higher
during 2022-2024
Enhancing Management
Transparency
Directors and Auditor
Operating the BOD and Audit Body BOD and Subcommittees (as of May 2022)
LG Innotek is operating subcommittees under the BOD by Board of Directors

reflecting the social demand and expectations for transparent (2 executive directors, 1 non-executive director, 3 outside directors)
governance. By establishing the outside director appointment
process, we secure core values for the BOD operation such as Audit The Committee audits the Company’s accounting Cheoldong Jeong Changtae Kim Joonhong Ahn Joon Chae Sangchan Park Heejeong Lee
expertise, independence, and transparency. In addition, we Committee and business operations, investigates the property Category Executive director Executive director Non-executive director Outside director Outside director Outside director
are promoting responsible management centering on the BOD status, and deliberates and resolves on matters Term of Service 2022. 3- 2020.3.- 2022.3.- 2021.3.- 2022. 3.- 2022. 3.-
while thoroughly abiding by the BOD operating regulations specified by the statutes and the Articles of Associa- 2025. 3. 2023.3. 2025.3. 2023.3. 2025. 3. 2025. 3.
and providing the BOD’s monitoring and audit functions. tion as well as those entrusted by the BOD. Consecutive Terms Reappointed (once) Newly appointed Newly appointed Reappointed (once) Reappointed (once) Newly appointed
Qualifications CEO, CFO, Head of Electronics Professor, Dept. of Busi- Head of Technology Professor, Korea
Composition of the Board of Directors Composition: Three outside directors LG Innotek LG Innotek Team, LG ness Administration, Seoul Systems Management, University Law School
National University SUNY Korea
BOD Composition Interest Executive, LG Innotek Executive, LG Innotek Executive, LG - - -
Outside The Committee secures transparency and fairness
- - - - -
Concurrent Position Outside director,
According to the statutes and the Articles of Association, the Director in the appointment of outside director candidates Holding Hyundai Heavy Industries
BOD resolves on the basic policies and key issues concerning
● ● ● ● (chairperson) ● ●
Candidate by verifying their capabilities and independence BOD
the Company’s management and business executions and also Recommen- from the Company, etc. Audit
provides its intrinsic function faithfully to supervise the execution dation ● (chairperson) ● ●
Committee
BOD
of duties by directors. As of May 2022, LG Innotek BOD consists Committee Composition: Two outside directors, Outside Director
and
one non-executive director Candidate
● ● ● (chairperson)
of two executive directors, one non-executive director, and Sub
Recommendation
three outside directors. To strengthen the BOD’s decision-making com
Committee
expertise, the Audit Committee, Outside Director Candidate ESG The Committee strengthens the Company’s ESG mi
ESG
Recommendation Committee, ESG Committee, Internal Trans- Committee management to achieve long-term and sustainable ttees
Committee ● ● ● ●
action Committee, and Management Committee are operated growth. Internal Transac-
● ● ● (chairperson)
under the BOD. tion Committee
Composition: Three outside directors,
●
Management
All members of the Audit Committee are outside directors one executive director Committee ● (chairperson)
appointed at the general shareholders’ meeting. This Commit-
※ The chairperson of the ESG Committee will be appointed at the next ESG Committee meeting in 2022. Corporate Governance
tee performs an effective supervisory function from an inde- Internal The Committee enhances fairness of transactions
pendent position. Transaction and transparency of the Company’s management
In 2021, the ESG Committee and Internal Transaction Commit- Committee by strengthening control on internal transactions.
BOD Independence
tee were established for the purpose of realizing sustainable LG Innotek ensures the independence of the BOD by appointing four out of the seven members in all—which constitute the majority—
management. These Committees deliberated on and reviewed Composition: Two outside directors,
as outside directors. Our outside director appointment process complies with related statutes such as Article 382 and Article 542-8
the fairness, integrity, and transparency of transactions between one executive director
of the Commercial Act and Paragraph 5, Article 34 of its Enforcement Decree.
affiliates as well as the Company’s ESG items. In March 2022,
(Due to the resignation of Director Yeongchang Ju in May 2022, however, an outside director will be appointed according to related statutes.)
an outside director was appointed as chairperson of the BOD. Management The Committee resolves on matters entrusted by
Therefore, the chairperson of the BOD and the CEO were Committee the BOD and other management-related matters in With respect to the BOD independence, we established the Corporate Governance Charter in 2021 by reflecting the requirements
separated, laying the basis for mutual check and monitoring order to improve efficiency of the BOD operation. of external stakeholders. The details concerning the BOD independence are available on our official website.
between the management and the BOD.
Composition: Two executive directors
The BOD convenes at least seven meetings a year. In 2021, Independence of Outside Directors
total of 66 agendas were deliberated through nine Board Meet- LG Innotek BOD Composition
Requirements Met
ings, five Audit Committees, one Outside Director Candidate Outside Director Independence Requirements
Joon Chae Sangchan Park Heejeong Lee
Recommendation Committee, two Internal Transaction Com-
mittees, and one ESG Committee. BOD Attendance (Unit: %) 1. An outside director shall not be an executive of the Company in the last five years. ● ● ●
2. With the exception of the cases permitted under SEC Rule 4200 Definition, an outside director or a person
who is a family member of an outside director shall not receive remuneration in excess of USD 60,000 a ● ● ●
Procedures for Reporting of and Decision making on Total Attendance of Attendance of year from the Company, its parent company, or a subsidiary.
Key Management Items Attendance Outside Directors Executive Directors 3. A
ny family members of an outside director shall not be executives of the Company, its parent company, or
● ● ●
subsidiary in the last three years.
The BOD Secretariat and Supporting Secretariat of commit-
4. An outside director shall be neither an adviser or a consultant for the Company or its management nor associated
tees under BOD provide information to assist in outside direc-
94 97 96 100 100 or affiliated with a company that serves as an adviser or a consultant for the Company or its management. ● ● ●
tors’ management decision making. In addition, the report 86
● ● ●
79 82 78 5. An outside director shall not have any relations with an important customer or supplier of the Company.
and deliberation items are carefully reviewed prior to the BOD
6. An outside director shall not be in a service contract with the Company or its top management. ● ● ●
meetings in order to support the BOD’s best decision making
7. A
n outside director shall not be a member of a nonprofit organization that receives a considerable amount
for key items. For newly appointed outside directors in partic- ● ● ●
of contributions from the Company.
ular, information and resources necessary for their execution
8. An outside director shall not be a partner or an employee of the Company’s external auditor in the last three years. ● ● ●
of duties are sufficiently provided to ensure full supervision.
2019 2020 2021 2019 2020 2021 2019 2020 2021
● ● ●
9. An outside director shall not be in any conflict of interest based on which he or she cannot be considered
In 2021, the BOD made decisions on large-scale facility invest-
independent according to the internal regulations of the BOD.
ment and approval on the main contract for asset disposal of ※ Including non-executive director
the LED business, etc.
BOD Expertise Training for Outside Directors Assessment and Remuneration of Directors
As financial, business administration, technological, and legal experts, LG Innotek’s outside directors make key management deci- To enhance the BOD’s expertise and understanding of business The reappointment of an outside director whose term of service
administration, LG Innotek provides regular educational pro- has expired is determined through an assessment on the
sions, share their opinions, and monitor business operations based on their professional knowledge and experiences.
grams to outside directors. director’s activities. The BOD Secretariat assesses an outside
director by comprehensively considering his or her BOD meeting
Program Content Date Attendees Hosted by
Background/Qualifications for Appointment Curriculum Vitae (CV) attendance rate over the three-year term, expertise, and
Training Roles and 2019/04/17 Sangchan Park LG contributions to the Company’s management. The Outside
Cheoldong Having served for a long time at LG Display, Jeong for New legal Management
2004-2007 Head of Production Technology Division, LG Display 2020/04/21 Yeongchang Ju Director Candidate Recommendation Committee makes a final
Outside responsibilities Development
Jeong has a high level of understanding about business 2007-2011 Head of Production Technology Center, LG Display decision on the outside director reappointment by verifying
Directors of the BOD 2022/04/28 Heejeong Lee Institute
operations and holds expertise based on diverse 2011-2016 CPO, LG Display the outside director’s independence from the Company as well
CEO, experiences in the electronics industry. As a busi- Training Company’s 2020/12/21 All BOD
2016-2018 Head of Information and Electronics Materials on Business products,
as capabilities and eligibility as a director of a global enterprise.
LG Innotek ness administration and technological expert, Outside Secretariat
Business Division, LG Chem 2021/05/21 The upper limit of remuneration for directors is reasonably
and technologies, directors
Jeong was appointed as CEO with his competencies
2018–present CEO, LG Innotek Technologies and goals 2021/12/13 set by considering the rate of management goal fulfillment,
in overall company operation recognized.
Internal Internal control 2022/05/09 All BOD inflation rate, and external compensation competitiveness
Control over financial Outside Secretariat and implemented following a resolution at the general share-
Changtae As a financial expert with extensive experiences 1995–2003 Management Planning Team, LG Electronics reporting directors holders’ meeting. For outside directors, performance-based
Kim accumulated by serving as the head of the Finance 2003–2009 Jeong-Do Management TFT/Finance Team, LG remuneration other than the basic wage is not paid in order to
Division and Business Audit Division at LG Innotek, 2010–2011 Head of Finance Division, LG Innotek secure their independence.
Kim was appointed as executive director to contrib-
Outside Director Candidate Recommendation and
CFO, 2011–2012 Head of Business Planning Division, LG Innotek With respect to the remuneration of executive directors,
LG Innotek ute to the Company's development in the financial Appointment
2012–2019 Head of Business Audit Division, LG Innotek performance-based incentives are paid by comprehensively
and accounting fields. LG Innotek operates the Outside Director Candidate Recom-
2019–2019 Head of Audit Division 1, LG Management Development assessing financial performances, talent fostering outcomes,
Institute mendation Committee in order to secure fairness in the pro-
progress of long-term tasks, etc.
2019–present CFO, LG Innotek cess of outside director appointment and verify the indepen-
dence and capacities of outside director candidates. Among Category Assessment
Joonhong After his long-term service at LG Electronics, Ahn 2008–2009 Head of Management Planning Group 1, LG Electronics the three members of the Committee, two including the chair- Outside Quantitative BOD attendance
Ahn held positions such as the head of the Business 2015–2016 Head of Substrate and Material Business Planning person are outside directors. Directors element
Planning Division and Management Planning Division, LG Innotek The Outside Director Candidate Recommendation Committee Qualitative Expertise, contribution to management
Head of Division at LG Innotek. With extensive experiences 2016–2019 Head of Management Planning Division, LG Innotek recommends outside director candidates by considering their elements
Electronics in and knowledge of the Company and in related 2019–2021 Head of Jeong-Do Management TFT Audit Division 1, independence, expertise, and representativeness for various Executive Quantitative Financial performance such as sales,
Team, LG fields, Ahn was appointed as non-executive director LG Management Development Institute stakeholders, etc. based on the Commercial Act, related stat- Directors elements operating profit, and net profit
to contribute to the Company’s development. 2021–present Head of Electronics Team, LG utes, and BOD Operating Regulations. Among the candidates, Qualitative Leadership, expertise, ethical management,
outside directors are appointed at the general shareholders’ elements talent fostering
Joon Chae Having served as a researcher at MIT Sloan School 2006–present Professor, Dept. of Business Administration, meeting.
and an assistant professor at the Dept. of Finance Seoul National University Operating an Independent Audit Body
Professor, Management of the University at Buffalo-SUNY, 2017–2019 Vice President, Korea Derivatives Association The Articles of Association of LG Innotek prescribe the organiza-
New Appointment Process
Dept. of Chae is currently a professor at the Dept. of Business 2020~2020 President, Korea Derivatives Association tion of an Audit Committee with at least three outside directors
Business Ad- Administration, Seoul National University. As an ac- 2020–present Outside director, Hyundai Heavy Industries First Outside Second Outside Make final in order to maintain the independence of the Committee. In
ministration, Recommend
counting and finance expert, Chae was appointed Director Candidate Director Candidate decision at addition, at least one member must be appointed as accounting
Seoul National as outside director to contribute to strengthening outside
Recommendation Recommendation general
director or financial expert under the Commercial Act.
University the Company’s overall financial management and Committee Committee shareholders’
candidates
business analysis as well as functions of the Audit meeting meeting meeting In 2022, the authority and independence of the Audit Committee
Committee. were strengthened with only outside directors appointed as
· Discuss Eligibility · Select final Committee members.
of candidates candidate
Sangchan As the current head of Technology Systems Manage- 1995–2009 Professor, Dept. of Industrial Engineering, KAIST
Meanwhile, for the appointment of an Audit Committee member
Park ment at SUNY Korea, Park also served as professor 2009–2021 Professor, Dept. of Business Administration,
Reappointment Process at the general shareholders’ meeting, and related persons
of industrial engineering at KAIST, outside director Kyunghee University
cannot exercise their voting rights if their shares exceed 3%
Head of of Korea Exchange, Vice President of the Korean 2018–present Vice President, Korean Society for Quality Management First Outside Second Outside Make final of the total voting shares, respectively. This is aimed at guar-
Technology Society for Quality Management, and Dean of the Assess
2021–present Head of Technology Systems Management, SUNY Korea Director Candidate Director Candidate decision at
Systems outside anteeing the independence of the Audit Committee member
Kyunghee University Graduate School of Business. Recommendation Recommendation general
Management, Park was appointed as outside director based on director from the majority shareholder, etc. in the process of selection,
Committee Committee shareholders’
SUNY Korea activities and ensuring that the BOD does not overturn on a decision
his knowledge and experiences to contribute to the meeting meeting meeting
Company’s development by providing advice in the made by the Audit Committee; thus securing the independence
areas of management information and quality control. · Discuss · Decide of the functions and activities of the Audit Committee.
reappointment reappointment
In June 2021, we established the Audit Support Secretariat to
Heejeong Lee, a legal expert who has accumulated professional 2009–present Professor, Korea University Law School
be full charge of internal audits. The Secretariat reports audit
Lee knowledge and practical experiences by serving 2015–2019 Member of the Statutory Interpretation and Review
The Outside Director Candidate Recommendation Committee plans and results annually to the Audit Committee. In addition,
as professor at the Korea University Law School, Committee, Ministry of Government Legislation
also reviews the qualifications of outside director candidates to inspect the fulfillment of the compliance criteria, the BOD
Professor, President of the Korea Association for Telecom- 2020–present Member of the Personal Information
as members of the Audit Committee. In addition to strict verifi- appoints a person holding legally prescribed qualifications as
Korea munications Policies, and member of the Personal Protection Commission
University Information Protection Commission, was appointed cation of the candidates’ interest in the Company, such as rela- chief compliance officer and discloses the appointment in the
2021–present Member of the KOSDAQ Market Committee
Law School as outside director to contribute to the development tionships with the majority shareholder, status of holding posi- annual report.
2022–present President, Korea Association for Telecommunications
of the Company’s compliance management. tions at the Company and affiliates, transaction relationships, and The chief compliance officer inspects whether the employees
Policies
shareholding status, their basic qualities such as job enrichment, comply with the laws and regulations and appropriately execute
ethics, and sense of responsibility are reviewed with priority. the Company management and reports the results to the BOD.
Shareholder-centeredness
Protecting Shareholders’ Rights and Interests Shareholder Return Policy

For shareholder value enhancement, LG Innotek not only strengthened the shareholder-friendly dividend policy but also disclosed For shareholder value enhancement, LG Innotek’s dividend
Major Dividend Indicators (Unit: %, KRW)
the policy to enable dividend predictions. decisions are made on the basis of comprehensive consideration
of factors such as the level of profit in the respective year, ● (Consolidated) Cash dividend payout ratio(%)
In 2021, the amount of dividend per share was drastically increased to KRW 3,000, which is 4 times larger than that of the previous ■ Cash dividends per share(KRW)
maintenance of integrity of financial structure, cash flow and
year. The dividend policy of maintaining a dividend payout ratio of at least 10% based on the consolidated financial statements over
investment scale for future growth, and dividend stability.
the next three years (fiscal years 2022-2024) was also disclosed.
According to the mid-term dividend policy announced on 8.0
January 26, 2022, at least 10% of the net profit (excluding one-
Shareholder Status 3,000
off extraordinary income) based on the consolidated financial
As of December 31, 2021, LG Innotek issued 23,667,107 common shares but has not issued any other type of share. statements will be returned to shareholders over the next
7.0
Our majority shareholder is LG Electronics, owning 9,653,181 shares or 40.79% of our total shares. three years (fiscal years 2022-2024). 6.9
Excluding 2,600 non-voting treasury shares, we apply the One-Share, One-Vote rule. We heed the voice of our minority shareholders The term of the dividend policy was set as three years considering
as well as that of major shareholders and protect the exercise of shareholder rights as stipulated in the applicable statutes. uncertainties in the internal and external management envi-
ronment, etc. but can change depending on various circum-
stances, such as changes in the management environment or
market situation.
The total amount of dividend paid in fiscal year 2021 is KRW

71 billion (KRW 3,000 per share). Reflecting the improvement
management performances, the amount has been increased 700
by more than four times compared to the previous year. We 300
LG Electronics
9,653,181shares will continue striving to enhance shareholder value by protecting
(40.79%) shareholders’ rights and interest and strengthening the share-
2019 2020 2021
holder-friendly policy.
(Period 44) (Period 45) (Period 46)
23,667,107shares Other shareholders Shareholder Communication

11,422,531shares
With the prolongation of COVID-19, offline IR activities such as
(48.26%) (Unit: KRW 100 million, %)
face-to-face meetings have been limited. However, LG Innotek
National Pension Service communicated with investors by making full use of contactless Category 2019 2020 2021
2,591,395shares channels including conference call and online meeting. (Period 44) (Period 45) (Period 46)
(10.95%) Total Cash 71 166 710
Through the result, our communication with domestic and
Dividends
overseas investors increased despite the circumstances. Over
the year 2021, we held over 350 IR meetings in the form of (Consolidated) 1,023 2,361 8,883
one-on-one meeting, NDR (Non-Deal Road-show), participa- Net Income
Other Shareholder Status
tion in conferences of securities companies, etc. Cash Dividend 0.22 0.40 0.85
Category No. of Shares Owned (Shares) Shareholding Ratio (%) Yield (%)
To provide our shareholders with useful information, we disclose
Institutions 9,062,513 38.29 information about our management, finance, and shares on
(excluding the National Pension Service)
the website as well as through the announcement of disclosures
Individuals 2,357,418 9.96 and by using IR Archives and Digital History Center. For foreign
Treasury Stock 2,600 0.01 shareholders, we also provide performance data, disclosures,
Total 11,422,531 48.26 audit report, etc. in English.
※ The data above represent the percentages calculated against total outstanding shares. We also focus on interactive communication so as to collect
※ The data are based on the equity ownership of shareholders as of the most recent book closing date of December 31, 2021. shareholders’ opinions and reflect them to the management’s
decision making. We will continue strengthening communication
with our shareholders in order to maintain our position as a
reliable company in the market.
Risk Management
Jeong-Do Management Jeong-Do Management Internalization Activities

Company-wide Training Jeong-Do Management Pledge of Practice
LG Way LG Innotek provides training according to the job descriptions LG Innotek employees sign the “Jeong-Do Management
and positions of employees in order to help them develop Pledge of Practice” each year to keep in mind the importance
LG Code of Ethics knowledge and internalize Jeong-Do Management. Group train- of Jeong-Do Management and comply with its principles in
ing is provided for new organizational leaders and dispatched their day-to-day business activities. Suppliers signing new
overseas subsidiaries, and newly hired employees and custom-
Chapter 1 — Responsibilities and Obligations contracts are also requested to do the same to join in the
Vision No.1 LG ized training reflecting work characteristics of each division and effort to promote fair trade.
to Customers
training for managers are provided. In addition, regular online
The ultimate goal of LG is to be recognized as the market leader
training is provided to all employees. Pledges Signed to Prevent Conflicts of Interest (Unit: Person)
Chapter 2 — Fair Competition
in business performance as well as in management practices
2019 2020 2021

Jeong-Do Management Training (Unit: Person, %)
Behavioral
Mode
Jeong-Do
Management Chapter 3 — Fair Transactions Category 2019 2020 2021
13,386 13,840 14,509
Ethical management and code of conduct to enable Number of Persons Completed Training 8,888 4,936 8,340
capability development and fair competition ※ Number of persons at the time of pledge signing
Chapter 4 — Basic Ethics for Employees Domestic Employees 7,924 3,990 7,258
Overseas Employees 964 946 1,082
Management Customer People-oriented
Completion Rate (%) 100.0 50.0 92.5 Reporting Process
Principles Value Creation Management Chapter 5 — Corporate Responsibilities
to Employees ※ In 2020, the training completion rate was relatively lower as the LG Innotek operates the “Cyber Whistle Blowing” system to
The fundamental organizational principle guiding
company-wide training was not provided (bi-yearly).
LG from the beginning as a firm prevent violations of the Code of Ethics and handle violations
Chapter 6 — Responsibility to the Society swiftly upon occurrence in order to ensure substantial practice
Promotion
and Country of Jeong-Do Management.
LG Code of Ethics LG Innotek publishes various promotional materials to raise
In addition, rewards are given for reports submitted on cor-
the ethics awareness of all employees.
ruptive practices to encourage whistle blowing. The privacy
Aside from publishing the monthly Jeong-Do Management and identity of whistle blowers are fully protected; if such
LG Way and Jeong-Do Management Jeong-Do Management Organization newsletter, we issue digital booklets with which our employees
individuals suffer any disadvantage, we ensure that this is fully
As the foundation that guides all LG employees in their and Direction of Promotion can readily refer to the Code of Ethics at any time. We also en-
remedied and the corresponding compensation is provided.
thoughts and actions, the LG Way dictates how we practice To practice Jeong-Do Management, LG Innotek operates a divi- courage employees’ participation in Jeong-Do Management by
“Jeong-Do Management” to live by LG’s management philos- sion in charge of business audit. holding quiz events. Reporting Channels and Process
ophy of “Creating Value for Customers” and “People-oriented
The Ethics Bureau engages in Jeong-Do Management training Reporting · L G Group: LG Jeong-Do Management portal
Management” in order to attain the vision of “No.1 LG.” Jeong-
and publicity operations to investigate and prevent corrup- Channels (Cyber Whistle Blowing System )
Do Management represents LG’s distinctive code of conduct
tive practices identified through whistle blower reports and · L G Innotek: E-mail, phone, sexual harassment/
to develop capabilities steadily and play fair on the basis of
assessments. bullying reporting center
ethics management. By Jeong-Do Management, we do not
merely practice ethics management but take a step further to The Business Audit Team is tasked with work process assessment
·E
thics Bureau: Conduct overall investigations on
build competence to outperform competitors and generate and management consulting to contribute to monitoring Investigation
the submitted reports
substantial performance. Jeong-Do Management risks and strengthening company-wide /Review
* Sexual Harassment and Bullying: Operate dedicated
competitive edge. staff at respective worksites
LG Code of Ethics · Disciplinary Committee: Decide on disciplinary
Jeong-Do Management Organization measures for violations
At LG, we share the management philosophy of “Creating Value
for Customers” and “People-oriented Management” and promote
Reporting ·R
eporting: Regularly report investigation results
self-governing management based on autonomy and respon-
CEO /Improve- and relevant disciplinary measures to the BOD,
sibilities according to the spirit of the Management Charter. * Jeong-Do Management Quiz * Jeong-Do Management Newsletter
ment Audit Committee, and top management
We uphold the principle of free market economy, which em- · Improvement/Prevention: Review causes, identify
bodies the spirit of free and fair competition; based on mutual
Monitoring
Business Audit Division risks, carry out improvement management
trust and cooperation, we pursue mutual benefits for our Jeong-Do Management surveys are conducted annually at policies and internal controls, and strengthen
stakeholders to achieve permanent development as the No. 1 the group level to review employees’ compliance with the LG promotion and training to prevent recurrence
company in the world. Way and awareness of Jeong-Do Management. Domestic and
overseas worksites are subject to on-site reviews and regu-
The Code of Ethics has been established and is implemented Ethics Bureau Business Audit Team larly monitored for any signs of corruptive practices. We also
as the basis for correct behaviors and value judgment of all conduct quarterly monitoring for any violations of laws and
employees. This applies equally to not only domestic but also regulations.
all subsidiary employees.
Rewards Granted to Whistle Blowers Compliance Fair Trade

Reporting · Report and submit documents proving corruptive Without proper compliance, a company can suffer irrevocable LG Innotek is implementing the Compliance Program (CP) it in-
Jeong-Do Management Reporting Status (Unit: Report)
Method practices losses such as sanctions by the regulatory authorities as well troduced in order to establish a fair trade culture and improve
· For urgent matters, reports can be made on factu- Reports as stock price drop and damage to the corporate image. To management transparency by practicing fair trade and com-
al grounds without evidentiary documents Verified (Rate) strengthen the compliance management culture and prevent pliance.
2019 34 30 (88%) legal disputes and sanctions, LG Innotek established the Com-
Reporting · Cyber whistle blowing system, post, phone, fax,
17 1 16 pliance Team under the Legal Affairs Office. It supports organic Compliance System
Channel or personal visit
and comprehensive compliance management by integrating
Recognizing that fair trade and compliance are a fundamental
2020 33 28 (85%) and strengthening the company-wide compliance program.
Report element of corporate management, LG Innotek expressed the
· Ethics Bureau, Business Audit Division 21 2 10
Submitted to commitment to compliance both internally and externally.
2021 40 38 (95%) Mid- to Long-term Goals and Plans We appointed the head of the Management Support Division
Reward · When the Company’s profits increase while losses
19 12 9 With the goal of developing a company-wide compliance pro- as compliance officer, established “Fair Trade Regulations”,
Payment decline (up to KRW 1 billion)
gram with which employees can thoroughly understand and and clarified the responsibilities and obligations of executives
Criteria ● HR related ● Corruption ● Others
· When direct profit increases occur or retrieval of in charge based on neutral and independent organizational
comply with the business-related regulations, LG Innotek pub-
financial losses is confirmed
lishes newsletters aimed at enhancing employees’ compliance operation.
(20% of the respective amount) In 2021, measures were taken according to the internal regula-
awareness and intensively managing key risks; such as re-in-
· When it is difficult to calculate the equivalent tions on 38 out of 40 reports investigated in relation to Jeong-Do
specting the internal risk pool, reviewing and supplementing Fair Trade and Compliance System
value of rewards, payment is made in the amount Management. None of the reports were subjected to legal or
the Company’s regulations, activating compliance education, etc.
of KRW 10 million or less administrative dispositions.
Establish Global-Standard Fair Trade
Compliance Risks Assessment and Compliance Culture
Each year, LG Innotek, under the supervision of an organization
Company-wide Review
specializing in handling legal affairs, inspects the compliance
Business risks are detected at an earlier phase, and their causes are eliminated through preemptive business, functional, and corporate control system by identifying key laws and risks related to cor-
Promotion Details
reviews. In addition, themed/instructed review is conducted based on requests from the top management to assist in their decision porate management and investigating the status of compliance
making and to secure substantial business competitiveness as well. in relation to major risks and reports the result to the BOD.
·E
xpressing the top management’s
By checking the reliability of the management information, verifying the appropriateness of business processing based on the Company’s In December 2021, we investigated the level of compliance and
Compliance commitment to compliance
regulations, and consequently deriving improvement plans, the reviews contribute to improving the Company’s management integrity. status of violations in relation to major risks, inspected compli-
System ·A
ppointing the compliance officer and
ance with the compliance control criteria according to the Com-
operating a compliance organization
Review Types Review Process mercial Act and internal regulations, and assessed the validity
of the compliance control system.
Business Review Functional Review ·S
earching review area, obtaining information, · Operating an educational program
Establish The result indicated LG Innotek’s compliance with the compli- Enhancing
Plan forming hypotheses, scheduling review for employees
Inspect the competitiveness of Inspect functional ance control criteria and system. For potential risks concerning Employee
each business and execution organizations’ compliance with anti-corruption and fair trade identified in key business areas, ·D
istributing the fair trade and
Awareness
power according to strategic processes, contracts, and laws we will establish improvement plans through cooperation with compliance guidebook
direction and regulations · Analyzing the issue in detail, finalizing
Execute divisions specializing in handling the respective risks, suggest
the issue, analyzing the cause, deriving an guidelines to the field departments, and strengthen compli-
Review · Establishing a monitoring system
Corporate Review Themed/Instructed Review improvement plan Risk
ance training and monitoring.
· Establishing the reward and
Management
Inspect the integrity Support the top management’s punishment system
of overseas decision making by checking Compliance Management Areas
subsidiary operation on the management status · Organizing the result of review
Share
and issues based on requests (review log, report), final wrap-up, preparing/ Area Statutes
Result Operation · I ntroducing CP assessment of the
from the top management submitting the report Fair Trade Monopoly Regulation and Fair Trade Act, Fair Transac-
Assessment/ Fair Trade Commission
tions in Subcontracting Act
Improvement · Upgrading compliance program
Human Labor Standards Act, Act on the Protection of Temporary
Resources Agency Workers, Equal Employment Opportunity and
Punishment System and Labor Work-Family Balance Assistance Act, Act on the Protec-
tion of Fixed-Term and Part-Time Employees
After a fact confirmation report, the case is submitted to the Disciplinary Committee according to the punishment resolution and
Anti-corruption Improper Solicitation and Graft Act
deliberation criteria and will follow process as below.
Personal Personal Information Protection Act
(In case of an objection to the decision of punishment, re-deliberation can be requested within three days of receipt of the punish- Information
ment notice.) Intellectual Patent Act, Utility Model Act, Design Protection Act, Copy-
Property right Act, Trademark Act, Unfair Competition Prevention
and Trade Secret Protection Act, Invention Promotion Act
Request improvement Encourage implementation Inspect Safety and Occupational Safety and Health Act, Clean Air Conser-
Improvement
plan submission of improvement plan implementation status Environment vation Act, Water Environment Conservation Act, Waste
Deliver Control Act, Chemical Substances Control Act
review result Business Commercial Act, Financial Investment Services and
Present punishment
Punishment Consult for punishment Post punishment result Administration Capital Markets Act, Act on External Audit of Stock Com-
plan for discussion
panies, Foreign Exchange Transactions Act, Commercial
Registration Act
Enhancing Employee Awareness Risk Management Crisis Management

LG Innotek provides training on the Monopoly Regulation and To prevent violations of subcontracting regulations, LG Innotek
Failure to respond properly to corporate crisis can give rise Crisis Response Process
Fair Trade Act to employees in order to complete the estab- conducts monthly risk inspections and quarterly illegal sup-
to management crisis, such as paralysis of the company’s key
lishment of a fair trade and compliance culture. Each year, we port inspections. Difficulties raised in relation to fair trade are The Committee operates 12 subcommittees to address 5 risk
operations, damage to corporate reputation, and customer
operate a basic company-wide educational course aimed at resolved through full-time support from a division in charge. types (business operation crisis, disaster crisis, safety and
churn. As crisis lead to loss of trust from stakeholders, the
improving the fair trade capabilities of employees as well as For risk prevention, we also perform activities to improve environment crisis, security crisis, and publicity crisis), and it is
company’s existence can be threatened. Accordingly, LG Innotek
advanced courses focusing on job-related details by division. fundamentally the way we work and the operating system. establishing crisis management regulations for each subcom-
established the risk management system, dedicating every
These courses deal with content of the relevant statutes, policy Employees who contributed to compliance improvement are mittee to follow the crisis response process. Executives at each
effort to risk response.
trends, violation cases, and guidelines. In 2021, the training rewarded with incentives, and those who committed or who are subcommittee make initial responses and perform analyses
was provided in the form of one basic course and three advanced strongly suspected of committing serious violations are slapped upon the occurrence of risk, rate the level of risk, and address
courses. We also publish newsletters on a regular basis to share with stringent sanctions. Meanwhile, we created compliance Corporate Crisis Management System the risk situation. In case joint response is necessary, the rele-
the policy trends and compliance guidelines with employees. whistle blowing and counseling channels on the website to heed Establishment of Corporate Crisis Management System vant subcommittees are notified for cooperation.
the voice of our suppliers and other external stakeholders. Recognizing that crisis management is a highly significant prior-
Training Program (2021) ity, LG Innotek is stipulating crisis management roles, responsi-
Crisis Response Process
Category Course (Target) Cycle bilities, processes, and implementation criteria at all levels to
Subcontracting Risk Monitoring Process
respond to risks effectively the moment they occur.
Introductory Basic training on fair trade Make initial Response to
(all office workers) Risk evaluation In addition, we appoint the CRO and the department in charge Rate
System-based Response to Crisis response situation and
and derivation of the crisis
Advanced Subcontracting risk monitoring individual risks of crisis management operated under the leadership of the occurrence and analyze notify to
level
improvement plans CRO in order to minimize management risks and tangible and the crisis subcommittee
(procurement, outsourcing management),
Yearly
Internal transaction intangible losses through systematic management during
· Leverage the · Analyze risk · Perform improve- ordinary times as well as in crisis situations.
(related departments in subsidiaries),
round-the-clock and establish ment activities and Crisis Types and Subcommittees (12 Subcommittees for 5 Crises)
Collusion
potential risk improvement plan provide training to
(overseas sales subsidiaries) Operating the Corporate Emergency Production Finance Quality Procurement
identification prevent recurrence Business
system (monthly) Response Committee Operation Crisis Fair Trade HR and Labor Marketing
LG Innotek distributes compliance guidelines including the
LG Innotek operates the Corporate Emergency Response Com-
applicable fair trade-related laws and regulations as well
mittee in order to respond to and make decisions for internal and Security Crisis Information Security IT
as legally appropriate work procedures in e-book format to
Operation Assessment/Improvement external crisis by consolidating competencies at all levels.
assist in employees’ understanding and practice of compliance. Disaster Crisis
LG Innotek objectively assesses and improves the status of When an emergency situation occurs, the Committee, with the War
The guidelines are updated annually by reflecting regulatory
compliance operation by introducing the CP evaluation system. CEO as chairperson, the CRO as director, and the Crisis Man- Safety and
amendments. Safety and Environment
Internally, we also inspect the compliance operation status on agement Team as secretariat, functions as a control tower for Environment Crisis
a regular basis, take the necessary improvement actions, and the Corporate Crisis management system operation. We also
Number of Persons Completed Publicity Crisis PR
(Unit: Person) report the result to the top management. established the crisis management process, holding monthly
Fair Trade Training meetings to share our crisis management status and discuss
improvement plans.
Response to Safety and Environment Regulations In 2021, we focused on crisis management system and stan-
2019 3,458
dard establishment, operation and management, and commu-
Recognizing the importance of safety and environment, Emergency Response Committee
nication and promotion based on the subcommittees. In 2022,
2020 4,570 LG Innotek introduced a safety and environment assessment
acquisition of ISO 22301 (business continuity management)
function to strengthen the “Check” part of PDCA (Plan-Do- Chairperson (CEO)
certification is being promoted in order to secure a system
2021 3,583 Check-Action) for the safety and environment sector. The
with which key businesses can be recovered in the shortest
safety and environment assessment targets all domestic and
possible time if discontinued due to unexpected accidents.
overseas worksites. Through the assessment, emergency Leader of General Control Tower (CRO)
※ Targeting domestic office and plant workers Starting with the Gumi worksite, we plan to expand the system
response systems in the worksites are inspected and improved
application to all worksites including those abroad.
with stricter criteria than the related laws and regulations
Crisis Management Team
applied. In addition, for preemptive response to 60 safety and
(Secretariat) Crisis Registration/Management
environment-related laws such as the Occupational Health and
Safety Act, Framework Act on Firefighting Services, Clean Air When an accident occurs in relation to the crisis types defined,
Conservation Act, and Framework Act on Low Carbon, Green the accident is registered in and managed with the Crisis
Head of Quality
Growth, we developed a regulatory management system and CSO CHO Management Information System (CMIS). For an accident that
Management Center
established and distributed approximately 80 regulations and has occurred, we perform activities in order of accident reg-
guidelines, and we are also performing EESH-related response Head of Business Head of Business Head of Safety and istration, progress report, cause investigation, improvement
Support Division Planning Division Environment Division
and prevention activities. report, completion report, and recurrence prevention.
Head of Procurement Head of Production Heads of Using a report function within the system for issues that
Division Technology Division Business Units can lead to a crisis situation, related divisions take handling
actions and provide feedback.
Internalization Activities of Crisis Management Information Security

In 2021, online training on crisis management was provided integrates financial information such as cost, accounting, and
LG Innotek is performing a range of information security activ- Information Security Operational System
to all employees, with the crisis management policy and sys- fund and provides it to the management so as to assist in the
ities while establishing and operating an information security
tem posted on the online and offline noticeboards to promote management’s decision making in response to risk factors. Regulations and Process
system in order to protect its information and assets from
crisis management internalization. In addition, each division The Internal Control Management System (ICMS) has also been Through the establishment and full revision of the standard
continuously advancing internal and external information
subject to crisis response and management holds crisis response introduced to conduct regular assessments and verifications in 2020, LG Innotek strengthened the company-wide security
security threats. We will continue strengthening the level of
simulation training. on major work processes to prevent and address risk factors. management based on information security regulations, de-
our information security by reflecting the changing business
Meanwhile, we are strengthening the management of safety and tailed information security principles by asset, and 12 detailed
Foreign Exchange Risk environment, trend of security threats, and requirements of guidelines. Information security regulations define the compa-
environment-related crisis that, according to the characteristics the relevant statutes.
We have established foreign exchange management rules to ny-wide information security system and principles, with the
of the manufacturing business, have a high level of occurrence
ensure the soundness of our financial structure and assigned detailed guidelines specifying the criteria and procedures, etc.
frequency and which cause serious impact upon occurrence
dedicated staff to manage foreign exchange transactions, for- for information security inspection, audit, incident response,
and reflecting the details related to executives in the KPI. Direction of and Plans for Information Security Promotion
eign exchange cash flows and positions, and foreign exchange etc. We are also implementing the risk management regula-
profits and to identify and forecast trends in currency rates LG Innotek is establishing and applying customized informa- tions we have established to ensure swift response to informa-
Crisis Management Monitoring tion security-related risks. The information security operation
and foreign exchange market. tion security measures by considering the characteristics and
Preventive Monitoring information security risks of the Company’s assets as well as
standard is updated by reflecting changes in the information
Credit Risk security environment, trend of threats, and amendment of
LG Innotek develops pre-inspection plans by division and peri- the environments and applicable laws and regulations of the
Company-wide real-time monitoring is administered to man- related statutes through a review for revision at least once a
odically monitors the results of inspection activities under the worksites where the assets are located.
age credit risks. These risks are preemptively detected and year. All employees of LG Innotek can access the information
prevention management system. As a result, no violations or
security policy anytime through the Intranet.
significant issues were detected based on preventive activities prevented, and bond hedging instruments are arranged to
performed in 2021. minimize losses and increase our recovery rates.
Internal Information Facilities Information Security Organization
Human IT
(Trade Secret, and Tangible
Production Continuity Management Liquidity Risk Assets Assets and Decision-making System
Personal Information) Assets
From the initial stage of product development to the stage Monthly cash flow plans for three months out to forecast the With the Chief Information Security Officer (CISO) designated,
cash flow from operations, investments, and financial activi- LG Innotek operates a dedicated team consisting of information
of production, the relevant divisions (development, quality,
ties are developed under the liquidity risk management sys- security experts under the supervision of the CISO.
production technology, production) discover potential risks
through cooperation and take preemptive measures for produc- tem. Liquidity amounts are preemptively identified, secured, Establishment of Asset In addition, we are improving our information security level
tion-related risks and issues. and maintained to manage potential liquidity risks. Protective Measures Identification by segmenting roles and functions within the information secu-
rity organization and allocating professional personnel to the
Response to Emerging Risks Information headquarters and domestic and overseas worksites. The Se-
This is the initial stage of design wherein the
Initial Security Response curity Strategy Team establishes, examines, and inspects the
issues in mass production are reviewed and,
Stage of
if a problem is found, the risk is prevented
Climate Change Risk Analysis Process Classification company-wide security strategies and policies. The Security
Development Operation Team plans and performs information security ac-
through design modification. Recognizing the serious impact of climate crisis as a global issue
※ Reviewing Technique: DFM (Design For Manufacturing) on the Company’s business, LG Innotek actively responds to the tivities according to the characteristics of each worksite based
risk. As part of the effort, we have declared 100% transition to on the company-wide security strategies and policies.
For each design change, the development, renewable energy by 2030, and we are performing related ac-
*CISO
quality, and production technology teams joint- tivities. Although the demand for renewable energy is increas-
ly conduct review to check for quality and mass ing explosively, the supply is limited. To overcome this difficulty,
Development production-related problems. If a problem is we are reviewing various methods for stable energy supply. Ex- Domestic Overseas Security Strategy Team Security Operation Team
Stage Headquarters
found, the risk is prevented by re-examining amples include the use of Green Premium rates and introduction Worksites Worksites
* CISO: Chief Information Security Officer
the design or changing the
of Power Purchase Agreement (PPA) and roof-panel photovoltaic
production facility.
power generation system. In addition, as price increase is expect- Cyber Security
※ Reviewing Technique: DRBFM (Design Review Based
ed due to the limited supply, we are analyzing the impact on cost
on Failure Mode) LG Innotek is operating the prevention, detection, and response
and preparing responsive measures. In addition, we perform information security internal audit and
plans it has established for cyber attacks such as malicious
Led by the Quality Team, improvement on improvement once a year on domestic and overseas worksites code infection and hacking that cause damage whose degree
Development quality issues in the development stage and Compliance with the Serious Accident Punishment Act including the headquarters and have our information security is amplifying. Information security systems and solutions are
Wrap-up Stage mass production-related problems is checked management system internationally certified by acquiring ISO
The social demand for health and safety is amplifying in Korea operated for each stage from network to computers, and net-
(Transfer to to minimize issues in mass production.
due to the occurrence of fatalities, etc. Accordingly, the Serious 27001, an international certification for information security. work invasion attempts are being monitored through 24-hour
Production) ※ Reviewing Technique: Q-gate
Accidents Punishment Act, which further strengthens the legal inspection. In addition, we are improving the response capa-
(precision review meeting led by the Quality Team) Starting with the headquarters in 2011, our worksites acquire
responsibilities of businesses, has been enforced. Any serious bilities of employees including IT staff by operating a simulation
ISO 27001 certification. In 2022, we plan to complete the certi-
safety-related accidents are expected to wield serious mid- training program assuming cyber attack situations, such as
Each time an issue occurs, the relevant divi- fication for all worksites both in Korea and abroad.
Production to long-term impact on the company operation. Therefore, email attacks and hacking.
sions jointly conduct monitoring and review to
Stage
resolve the issue. LG Innotek completed standard improvement by implement- At the same time, the latest cyber attack cases and precau-
ing a task in response to the Act, and it is strengthening the 1 out of 12 Worksites
1 tionary instructions are spread to all employees at least once
process by establishing related systems, etc. Going forward, (as of April 2022) a month, and, when necessary, special training is provided to
Financial Risk Management ISO 27001
we will secure fundamental safety from the mid- to long-term enhance employees’ awareness of cyber security incidents.
Providing Integrated Financial Information and Operating Certification
perspective and establish a safety culture to realize zero-acci- To be Acquired by All Worksites Having recorded zero information security accidents and
the Internal Accounting Control Management System dent worksites. before July 2022 violations between 2019 and 2021, we will continue dedicating
The Global Integrated Financial Information System (GIFIS) effort to maintaining the “Zero Accident” state.
Information Security Incidents and Violations (Unit: Case) TISAX Certification Tax Policy
In October 2021, the five worksites of the Automotive Compo- LG Innotek fully complies with tax laws and regulations in Korea
Type 2019 2020 2021 Breakdown of Tax Payments by Region (Unit: %)
nents Business Unit (Magok, Pyeongtaek, Gwangju, Yantai, and abroad for all business transactions to fulfill faithfully its tax
Data management incidents 0 0 0
and violations
Poland) acquired the TISAX (Trusted Information Security As- obligations as stipulated by the statutes and maintains trans-
Category 2019 2020 2021
sessment eXchange) certification. As a certification system for parent relationships with tax authorities in the countries where Domestic 84.7 95.9 97.8
Customer/Employee data 0 0 0
violations vehicle information security developed by the German Associa- overseas subsidiaries are based. We establish internal regula- Overseas 15.3 4.1 2.2
tion of Automotive Industry in 2017, TISAX is a universal certifi- tions and processes to manage and minimize tax risks preemp-
Punishments for information 0 0 0 Total 100.0 100.0 100.0
security violations cation adopted by over 1,000 companies in around 30 countries tively, while assisting internal tax staff with career management
for the purpose of safe supply chain management. With the ※ As more than 90% of LG Innotek’s sales are generated within Korea,
(fines, penalties, etc.) and actively leveraging tax experts to conduct tax operations. tax payments made in countries outside of Korea are reported within
Total 0 0 0 certification, we can expand business opportunities with major
the single integrated category term “overseas.”
automakers including those in Europe. In particular, we believe
this can be said to be the result of preemptively responding to
Compliance with Tax Laws and Regulations and
Personal Information Protection
the level of social demand related to information security since Cooperation Tax Management Operating Principles
LG Innotek handles and manages personal information as a
the Automotive Components are directly related to human life LG Innotek abides by domestic and international tax laws and
priority and strives to protect the personal information of cus-
and safety. regulations and operates a specialized department to respond
tomers and employees. By appointing the Chief Privacy Officer Tax Management Compliance with Tax Laws
actively to various transactions that can give rise to tax risks.
(CPO) and establishing personal information protection plans Information Security Internalization In addition, we clarify internal processes and regulations to
annually, we provide information to personal information pro- 1
Training manage tax risks preemptively and calculate tax amounts
cessors, secure the safety of personal information processing We strictly abide by tax laws in Korea where we are
accurately and fulfill our tax obligations faithfully for the
system, encrypt important personal information, inspect the LG Innotek provides training and performs promotional activ- based and in countries where we operate.
establishment of sound tax-paying practices.
status of personal information storage, inspect and provide ities on a regular basis led by a team dedicated to information
related outsouring company training, and monitor for personal security management. These activities are aimed at helping
employees understand the Company’s information security policy
Fulfilling Global Tax Obligations
information leak, etc. In addition, “Personal Information Council”
meetings are held twice a year, with the results shared internally. and encouraging them to practice information security in daily LG Innotek is establishing a tax process overseas that is equiva- 2
As a result of the effort, no personal information leaks and operations. In addition, as cyber security and personal infor- lent in effectiveness to the one in Korea, and it complies with the We mutually respect tax treaties and do not
incidents have been reported over the last three years. mation protection require cooperation and practice across the tax regulations in each country in conducting transactions with take advantage of tax havens.
supply chain, we provide information security training to the affiliated parties.
key suppliers as well. We review the transfer prices of overseas subsidiaries in con-
Personal Information Leak/Incident Reports (Unit: Case)
formity to the OECD and other global standards in order to 3
Information Security Training Status (Unit: Person)
Type 2019 2020 2021 prevent risks and make full and transparent disclosures on the We faithfully fulfill our tax reporting and payment
obligations in any and all transactions that we enter into,
Privacy invasion, information 0 0 0 Category Program 2019 2020 2021 tax payments we make in the respective countries and relevant
and all our employees endeavor to prevent tax risks.
theft and loss Employees Basic information 2,607 6,816 4,326 transaction data to overseas tax authorities.
External Employees 0 0 0 security training
complaints Customers/Suppliers 0 0 0 Training on - 3,949 4,507 Disclosing the Details of Corporate Income Tax
and reports personal information 4
Regulatory Authorities 0 0 0 Expenses and Improving Transparency We maintain transparent relationships with tax
protection
LG Innotek makes regular disclosures of annual reports on the authorities and maximize the use of internal staff and
We also monitor the trend of establishment and implemen- Training for new 4,456 5,552 6,607
electronic disclosure system of the Korean Financial Supervi- external experts in preventing tax risks from occurring.
tation of personal information protection laws (EU GDPR, employees
sory Service (DART) to improve the transparency of tax status.
Personal Information Protection Law of China, etc.) in coun- Employees/ * Security staff who 150 164 179
These reports fully describe our sales, net income, corporate
tries where our overseas worksites are based and prepare to Suppliers completed official
human rights income tax expenses, and other relevant data. In addition,
acquire international certification in order to have the level of
training final reviews are conducted by internal and external tax experts
our personal information security officially certified.
Information security 39 49 36 on major tax items before we fulfill our reporting obligation
training for companies companies companies in order to ensure appropriate application of tax regulations;
Product Security suppliers (39 persons) (51 persons) (36 persons) thus protecting our stakeholders.
ICS/OT Security * All security personnel of each worksite are receiving official human rights
With respect to the Industrial Control System/Operational Tech- training according to the Security Services Industry Act (domestic). Corporate Income Tax Expenses
nology (ICS/OT), LG Innotek is establishing and operating sep-
arate information security measures for production facilities, Rate of Information Security Practice and (Unit: %) Corporate Income Tax Expenses (Unit: KRW 100 million)
systems, and products. Recognition by Employees
To prevent cyber attacks and other information security inci- 2019 85

2019 829
dents, we established an independent network to ensure that no
2020 92
production suspension and delay, etc. occur due to information
2020 1,119
security incidents. In addition, by establishing monitoring sys- 2021 93
tems and solutions and strictly controlling unauthorized access
※ Based on the result of the survey on the rate of information security 2021 3,143
to production processes and facilities, we are managing assets
practice and recognition by employees
to prevent their leak.
Appendix Sustainability Pledge 112

Economic Data 114
ESG Data Sheet 116
Independent Assurance Statement 128
Sustainability Indices 130
Memberships, Awards, and 136
Certifications
Sustainability Reports History 144
Sustainability Pledge
ESG Principles Our Progress in Achieving the UN SGDs
In order to fulfill its social responsibilities and promote sustainable management, LG Innotek is implementing the codes and policies
that it has established and which are applied in making decisions and taking actions in the areas of labor, environment, health and
safety, and ethics. The full text is available on the LG Innotek website.
Environmental Social Governance/Ethics
Support for the Support for Improvement in learning

Protection of Water resource
underprivileged employees’ health environments such as Material
gender diversity management
(Good Neighbor Plus) checkups and Component Science Class
EESH Policy Global Supplier LG Code of (Junior Pine Tree Class)
(Energy, Environment, Labor Policy Code of Conduct Ethics
p.088-p.091 p.028 p.089 p.074 p.058-p.059
Safety, Health)
KOR ENG KOR ENG KOR ENG KOR ENG
Energy conservation
Job creation, Industrial development Mitigation of Responsible
UN Global Compact 10 Principles and use of
business growth through innovation inequality production
renewable Energy
As a member of the UN Global Compact (UNGC) Korea, LG Innotek fully endorses the Ten Principles set by UNGC.
p.037-p.039 p.040-p.041, p.071 p.042-p.053 p.074-p.075 p.032-p.033
Principle Reference
1B
usinesses should support and respect the protection of internationally proclaimed
Human · Global Labor Policy
human rights; and
Rights
2 make sure that they are not complicit in human rights abuses. · Global Labor Policy
3 B
usinesses should uphold the freedom of association and effective recognition
Labor · Global Labor Policy
of the right to collective bargaining;
Response to Business link with
4 the elimination of all forms of forced and compulsory labor; · Global Labor Policy climate change NGOs and organizations
5 the effective abolition of child labor; and · Global Labor Policy p.034-p.039 p.136
6 the elimination of discrimination with respect to employment and occupation. · Global Labor Policy
Environment 7 Businesses should support a precautionary approach to environmental challenges · EESH Policy
8 undertake initiatives to promote greater environmental responsibility; and · EESH Policy
9 encourage the development and diffusion of environment-friendly technologies. · EESH Policy
Anti- 10 Businesses should work against corruption in all its forms, including extortion
· LG Code of Ethics
Corruption and bribery.
Economic Data
Sales Breakdown by Business Unit (Unit: KRW million) Summarized Consolidated Statement of Financial Position (Unit: KRW million)
Particulars 2019 2020 2021
2019 2020 Current Assets 2,530,944 3,161,800 4,113,364

Quick Assets 2,042,795 2,302,406 2,721,351
Inventories 488,149 859,394 1,392,014
Automotive Components Non-Current Assets 3,239,837 2,876,801 3,627,989
Automotive Components Others
Others 910,246 Investment Assets 34,691 53,941 54,791
1,131,901 (14.2%) 357,235 (3.7%)
367,727 (4.6%) (9.5%) Tangible Assets 2,707,628 2,367,767 3,146,378
Intangible Assets 276,821 188,101 198,078
Other Non-current Assets 220,697 266,992 228,742
Total Assets 5,770,781 6,038,600 7,741,353
7,975,366 9,541,790 Current Liabilities 2,046,234 2,284,222 3,310,268
Substrate and Substrate
Material and Material Non-current Liabilities 1,519,942 1,326,690 1,116,879
1,050,002 1,218,386 Total Liabilities 3,566,176 3,610,912 4,427,147
(13.2%) (12.8%) Capital Stock 118,336 118,336 118,336
Optics Solution Optics Solution Capital Surplus 1,133,646 1,133,646 1,133,646
5,425,736 (68.0%) 7,055,923 (73.9%) Capital Adjustment (321) (321) (321)
Accumulated Other Comprehensive Income (36,318) (38,448) 14,411
Accumulated Other Comprehensive Income - (7,035) 22
Held for Sale
Retained Earnings 989,262 1,221,510 2,048,112
2021 Minority Interest - - -
Total Equity 2,204,605 2,427,688 3,314,206
Automotive Components Others

1,062,310 (7.1%) 470,571 (3.1%)
Summarized Consolidated Statement of Income (Unit: KRW million)
Particulars 2019 2020 2021

Substrate and Material
Sales 7,975,366 9,541,790 14,945,609
1,567,008 (10.5%)
Operating Income 476,353 681,019 1,264,223
Net Income from Continuing Operations 150,039 330,903 878,915
14,945,609 Net Loss from Discontinued Operations

Net Income
(47,738)
102,300
(94,775)
236,128
9,367
888,282
Basic and Diluted Earnings per Share 6,340 13,983 37,141
(Continuing Operations) (Unit: KRW)
Basic and Diluted Earnings per Share (2,017) (4,005) 396
(Discontinued Operations) (Unit: KRW)
Number of Consolidated Companies 12 12 12
Optics Solution
(Unit: Company)
11,845,720 (79.3%)
※ Sales by business unit have been recalculated as the Automotive Camera Division was transferred from the Automotive Components Business Unit
to the Optics Solution Business Unit in 2022.
ESG Data Sheet Waste
Category Unit 2019 2020 2021

Waste Generation
Environmental Data Total Generation (General + Hazardous Waste) 23,236 34,871 39,773
Waste Generation (by type) General Ton 13,432 24,578 18,944
GHG Hazardous 9,804 10,293 20,829

Waste Generation Intensity Ton / KRW 0.30 0.37 0.27
(Waste Generation/Sales) 100 million
GHG Emissions
Recycling
Total GHG emissions (Scope 1 + 2) 394,990 350,061 367,099
Amount Recycled Ton 20,565 31,534 35,182
Scope 1 Emissions 23,759 15,044 13,979
tCO2eq Recycling Rate % 88.5 90.4 88.5
Scope 2 Emissions 371,231 335,024 353,120
Treatment
Scope 3 Emissions *186 *166 *199
Waste Treated 2,672 3,337 4,590
Scope 3 Category (Measurement/Disclosure) - Waste generated in operations
Waste Treatment (by type) Landfill 162 98 462
GHG Emissions Intensity tCO2eq / KRW 4.95 3.67 2.46 Ton
Incineration 606 549 804
(GHG Emissions/Sales) 100 million
Others 1,904 2,690 3,324
※ Scope of Data Collection: Consolidated (domestic for figures marked with “*”)
Waste Treatment Intensity Ton / KRW 0.034 0.035 0.031
(Waste Treatment/Sales) 100 million
※ Scope of Data Collection: Domestic for 2019, consolidated for 2020-2021

Energy
Energy Consumption Water Resources
Total Energy Consumption (MWh) 886,268 858,514 906,350
Consumption of Fuel (Excluding Feedstock) 87,360 64,221 58,150
Withdrawn
Consumption of Purchased or 694,155 676,498 727,492
Total Water Withdrawn 9,887,468 9,102,894 9,370,849
Acquired Electricity
Groundwater 66,088 - -
Consumption of Purchased or Acquired Heat - 5,438 4,324
Produced/Entrained Water Ton 5,120,833 3,999,154 3,847,963
Consumption of Purchased or 104,457 111,876 116,138
MWh Tap Water 1,485,930 1,213,204 1,325,802
Acquired Steam
Renewable Sources - 50,222 54,011 Third Party Sources 3,214,617 3,890,536 4,197,084
Non-renewable Sources - 61,654 62,127 Withdrawn Intensity Ton / KRW 124 95 63

(Water Withdrawn/Sales) 100 million
Consumption of Purchased or - - -
Acquired for Cooling/Heating Discharge Ton *8,005,189 7,711,191 7,751,853
Consumption of Self-Generated 296 481 246 Discharge Intensity Ton / KRW *103 81 52
Non-fuel Renewable Energy (Water Discharge/Sales) 100 million
Total Renewable Energy Consumption - 50,703 54,257 Reuse
Total Non-renewable Energy Consumption - 807,811 852,093 Water Resources Reused Ton 4,139,432 4,862,802 5,000,582
Energy Intensity 1.15 0.95 0.58 Reuse Rate % 41.9 53.4 53.4
%
[(energy cost/production amount)*100] ※ Scope of Data Collection: Consolidated (domestic for figures marked with “*”)
Renewable Energy Consumption
Renewable Energy Independent 296 481 246

Consumption Generation MWh
(by energy source) Green Premium - - 41,000
※ Scope of Data Collection: Consolidated

Pollutants Social Data

Air Pollutants Employees
Total Emissions (SO + NO + dust) 57.2 46.3 48.6 Total Employees
SOx 16.4 10.2 3.8
Ton Category Unit 2019 2020 2021
NOx 25.7 15.9 20.7
Number of Employees Person 14,327 15,621 18,717
Dust 15.1 20.2 24.1
Domestic 8,891 (62.1) 10,827 (69.3) 12,415 (66.3)
SOx Emissions Concentration against Legal Limit 0.7 0.0 0.3 Person (%)
Overseas 5,436 (37.9) 4,794 (30.7) 6,302 (33.7)
NOx Emissions Concentration against Legal Limit % 4.4 5.1 8.3
By Gender
Dust Emissions Concentration against Legal Limit 3.1 4.1 3.6
By Gender Male - 11,497 (73.6) 13,766 (73.5)
Water Pollutants Person (%)
Female - 4,124 (26.4) 4,951 (26.5)
Total Discharge (BOD, COD, SS, T-N, T-P) 876.0 813.3 759.8
By Age
BOD (Biological Oxygen Demand) 318.0 318.0 166.0
By Age Under 30 years of age - 6,054 (38.7) 8,080 (43.2)
COD (Chemical Oxygen Demand) 283.0 258.0 295.0
30 years of age and older- - 8,976 (57.5) 9,877 (52.8)
Ton Person (%)
SS (Suspended Solid) 105.0 147.0 113.0 under 50 years of age
T-N (Total Nitrogen) 165.0 86.0 181.0 50 years of age and older - 591 (3.8) 760 (4.0)
T-P (Total Phosphorus) 5.0 4.3 4.8 By Job Position
BOD Emissions Concentration against Legal Limit 40.3 25.4 8.4 By Job Position Executive - 39 (0.2) 45 (0.2)
COD Emissions Concentration against Legal Limit 28.9 13.9 19.9 Office Worker Person (%) - 4,888 (31.3) 5,439 (29.1)
SS Emissions Concentration against Legal Limit % 7.7 9.2 11.9 Line Worker - 10,694 (68.5) 13,233 (70.7)
T-N Emissions Concentration against Legal Limit 16.8 9.2 20.5 By Country of Birth
T-P Emissions Concentration against Legal Limit 3.6 6.5 10.7 By Country of Birth Korea - 10,812 (69.2) 12,403 (66.3)
China - 1,329 (8.5) 1,475 (7.9)
※ Scope of Data Collection: Domestic for 2019 and Emissions Concentration against Legal Limit, consolidated for 2020-2021
Vietnam - 2,246 (14.4) 3,555 (19.0)
Indonesia Person (%) - 771 (4.9) 736 (3.9)
Environmental Investment Poland - 244 (1.6) 272 (1.5)
Mexico - 181 (1.2) 231 (1.2)
1)
Others - 38 (0.2) 45 (0.2)
Environmental Investment (Air+Water+Waste) 148 139 214
Environmental Investment (Air) 44 46 79
KRW 100 million 1) 2020: 19 from the USA, 11 from Germany, 7 from Japan, 1 from India
Environmental Investment (Water) 68 57 121 2021: 22 from the USA, 11 from Germany, 11 from Japan, 1 from India
Environmental Investment (Waste and Others) 36 36 51

Employees by Other Criteria
※ Scope of Data Collection: Domestic for 2019-2020, consolidated for 2021
By Contract Type
Environmental Expenses Full-time Employees Total 7,662 7,522 7,999
Male 6,477 6,366 6,783
Female 1,185 1,156 1,216
Environmental Expenses (Air+Water+Waste) 143 220 147 Person
Contract Workers Total 1,229 3,305 4,416
Environmental Expenses (Air) 22 28 25
KRW 100 million Male 776 2,244 3,048
Environmental Expenses (Water) 78 136 71
Female 453 1,061 1,368
Environmental Expenses (Waste and Others) 43 56 51
By Educational Level
※ Scope of Data Collection: Domestic for 2019, consolidated for 2020-2021
By Educational Level Total - 3,952 4,444
(Office Worker) Graduated from - 31 27
High School
Graduated from College - 361 376
Person
Graduated from - 2,424 2,756
University
Master’s Degree or - 1,198 1,285
Higher
※ Scope of Data Collection: Domestic

Female Employees Category Unit 2019 2020 2021
Category Unit 2019 2020 2021 Parental Leave

Employees Who Returned to Work after Parental Leave Person 145 121 152
Management - 447 (11.9) 536 (12.7)
Rate of Employees Returning to Work after % 90.6 85.1 88.9
Junior Management - 380 (17.8) 443 (18.7)
Parental Leave
Senior Management Person (%) - 66 (4.2) 92 (5.1)
Employees Who Continued to Work for 12 Person 112 123 106
Top Management * Percentage of - 1 (2.6) 1 (2.3) Months or Longer Following Parental Leave
female workers
Sales Generation11) in the respective - 67 (21.8) 81 (23.4) Rate of Employees Continuing to Work for 12 % 76.2 76.9 88.3
2) job group Months or Longer Following Parental Leave
STEM - 256 (10.1) 308 (10.8)
Female Employees in Line - 3,214 (30.1) 3,740 (28.3)
※ Scope of Data Collection: Domestic (consolidated for Female Employees in Line) Assessment and Remuneration
1) Sales Generation: Persons working in sales-generating departments, such as marketing and sales
2) STEM: Persons working in Science, Technology, Engineering, and Mathematics-related job groups
Competency/Performance Assessment
Recruitment and Retention Category Unit 2021

Competency Domestic 7,313
Overseas 5,823
New Recruits Person 197 285 4,948 Person
Performance Domestic 7,525
By Gender Male - 240 (84.2) 3,468 (70.1)
Overseas 5,823
Female - 45 (15.8) 1,480 (29.9)
By Age Under 30 years of age - 162 (56.8) 3,985 (80.5)
Person (%) Remuneration of Employees
30 years of age and older- - 122 (42.8) 948 (19.2)
under 50 years of age Category Unit 2019 2020 2021
50 years of age and older - 1 (0.3) 15 (0.3) Wage
Average Wage 6,400 6,900 7,400
※ Scope of Data Collection: Domestic for 2019-2020, consolidated for 2021
Average Wage by Gender Male - 7,246 7,783
(Total Pay and Bonus) Female - 5,282 5,683
Average Pay by Gender Male KRW 10,000 - 6,112 6,250
Internal Recruitment
Female - 4,625 4,793
Internal Recruits Person 1,066 842 462
Average Bonus by Gender Male - 1,134 1,533
Positions Filled through Internal Recruitment % 84.0 75.0 41.0
Female - 657 891
Number of People with Disabilities Employed Person 250 270 306
Difference in Average Pay by Gender (Male to Female) - 75.7 76.7
Employment Rate of People with Disabilities % 2.8 2.8 2.8 %
Difference in Average Bonus by Gender (Male to Female) - 57.9 58.1
Average Recruitment Expenses
Median Wage
Average Recruitment Expenses per Person KRW 10,000 417 252 132
Median Wage 6,524 7,014 7,681
Resignation/Turnover Rate
Median Wage by Gender Male - 7,318 8,186
Resignation/Turnover Rate 6.8 4.6 4.3
Female - 5,802 6,248
By Gender Male - 4.4 4.0
Median Pay by Gender Male KRW 10,000 - 6,216 6,540
Female - 6.2 5.9 Female - 5,057 5,117
By Age Under 30 years of age - 6.1 8.7 Median Bonus by Gender Male - 1,102 1,646
30 years of age and older- - 4.0 3.3 Female - 745 1,132
under 50 years of age %
Difference in Median Pay by Gender (Male to Female) - 81.4 78.2
50 years of age and older - 7.1 5.7 %
Difference in Median Bonus by Gender (Male to Female) - 67.6 68.8
By Job Position Office Worker 6.8 5.8 6.3
Pay Ratio
Line Worker 6.9 3.4 1.9 Male Pay Ratio - - 105.0
Voluntary Resignation/Turnover Rate %
Female Pay Ratio - - 80.5
Voluntary Resignation/Turnover Rate 2.5 3.3 3.4 Retirement Pension
By Gender Male - - 3.2 Retirement Pension Balance KRW 100 million 3,790 4,395 5,397
Female - - 5.0 Remuneration
By Age Under 30 years of age - - 8.4 CEO Remuneration (Total) 116,200 185,400 220,600
30 years of age and older- % - - 2.7 CEO Remuneration (Pay) 116,100 117,000 119,100
under 50 years of age CEO Remuneration (Bonus, Variable Pay) KRW 10,000 0 68,200 97,500
50 years of age and older - - 1.0 CEO Remuneration (Others) 100 200 4,000
By Job Position Office Worker 4.9 4.7 5.1 Outside Director Remuneration (Pay and Bonus) 7,200 7,200 8,500
Line Worker 2.6 1.8 1.5
Employee Training
Distribution of Industrial Accidents Affecting Employees (by Injury Type) (Unit: %)
Training Expenses
Training Expenses KRW 100 million 49.5 33.5 51.7 Loss of Limbs/ Others
Trips Cuts/Incisions 10.0
Training Expenses per Person KRW 10,000 56 31 66 Trips Others
Others 20.0
12.5 27.3 9.1
Training Hours 25.0 Being
Training Hours per Person - - 47.9 2019 2020 Being Being 2021 Pushed
By Gender Male - 61.6 46.2 Jammed Jammed 10.0
Female - 59.5 57.4

36.3 20.0
Being Loss of Limbs/
By Age Under 30 years of age - 82.4 66.2 Struck Being Cuts/Incisions Being Pushed Being Struck Trips
Hour 25.0
30 years of age and older- - 59.4 41.6 Jammed 18.2 9.1 10.0 30.0
under 50 years of age 37.5
50 years of age and older - 44.2 34.1
By Job Position Office Worker 64.8 34.4 64.6
Line Worker 27.9 20.7 28.0 ※ LTIFR (Lost Time Injury Frequency Rate): Percentage of lost work time measured per one million work hours
※ OIFR (Occupational Illness Frequency Rate): Percentage of work-related illnesses occurring per one million work hours
※ Injury Rate: Percentage of workers injured against the total number of workers
※ Severity of Injury: Lost work days/total work days x 1,000
Employee Satisfaction Health and Safety (Suppliers)
Category Unit 2019 2020 2021 Category Unit 2019 2020 2021
Employee Satisfaction 71 70 88 Supplier LTIFR (LTIR) %, per one million 0.82 0.76 1.12
By Gender Male - 72 87 hours of work
Female - 63 89 Deaths Caused by Work-related Illnesses - - -
By Age Under 25 years of age - - 78 Work-related Illnesses Case - 1 -

Point
26-34 years of age - - 83 Deaths Caused by Industrial Accidents - - -
35-44 years of age - - 89

45-54 years of age - - 93
Distribution of Industrial Accidents Affecting Suppliers (by Injury Type) (Unit: %)
55 years of age and older - - 96

※ Difference in data available for disclosure as satisfaction survey questions vary in 2019-2021
Being Trips Trips Inhalation of Being in Contact
Pushed 50.0 33.0 Chemicals with Abnormal
Health and Safety 25.0 14.3 Temperature
Falls
14.3
Health and Safety (Employees) 2019 from a 2020 2021
Being Height Being Falls from
Struck 67.0 Jammed a Height
Employee LTIFR (LTIR) %, per one million 0.232 0.317 0.217
25.0 28.6 42.8
Employee OIFR hours of work 0.029 0.000 0.000
Injury Ratio % 0.047 0.077 0.061
Severity of Injury %, per 1,000 0.023 0.012 0.004 ※ Scope of Data Collection: Consolidated (domestic for Supplier LTIFR)
hours of work
Deaths Caused by Work-related Illnesses - - -
Work-related Illnesses Case 1 - -
Deaths Caused by Industrial Accidents - - -
Supplier Local communities
Supply Chain Status Category Unit 2019 2020 2021

Support to Local Communities KRW 100 million 25.4 31.7 44.5
By Financial Source Cash 16.7 (65.7) 20.8 (65.5) 33.2 (74.6)
Total Suppliers (Tier 1) 921 843 774
Company In-kind 8.7 (34.3) 10.9 (34.5) 11.3 (25.4)
Critical Suppliers 454 444 454
By Purpose Charity Donation 11.9 (46.9) 19.0 (59.8) 27.5 (61.8)
Percentage of Purchase of Critical Suppliers % 99.2 99.5 99.7 KRW 100 million (%)
Investment in Local 8.7 (34.3) 10.9 (34.4) 14.2 (31.9)
Total Annual Expenses of Raw Materials KRW 100 million 54,725 68,306 108,948
1)
Communities 4.8 (18.8) 1.8 (5.8) 2.8 (6.3)
Local Purchases (Ratio) KRW 100 million (%) 325 (33.1) 387 (28.7) 777 (36.3)
Commercial Initiatives
Companies Participated in ESG SAQ Company 336 75 301
Rate of Participation in ESG SAQ % 36 9 39

1) Local Purchases (Ratio): Based on overseas worksites Donation Amount
Donation Amount - 29.9 41.7
Shared Growth
Community Chest of Korea - 13.0 15.8
ChildFund Korea KRW 100 million - 5.7 5.7
Financial Support for Suppliers
LG Yonam Foundation - 1.0 7.0
Shared Growth Funds Raised 1,030 1,030 1,030
Other Beneficiaries - 10.2 13.2
Shared Growth Funds Executed KRW 100 million 515 573 645
Use of Shared Growth Payment System 8,577 11,121 16,257
Educational Support for Suppliers
Suppliers Participated in Training Company 269 202 212
Employees' Volunteer Service Hours Hour 29,684 496 3,351
Number of Persons from Suppliers 950 1,136 1,305
Person Funds Raised by Employees KRW 100 million 3.6 3.2 3.2
Participated in Training
Percentage of Employees Participating % 93 88 74
Educational Courses for Suppliers 417 402 402
in Fund Raising
Online Course 365 365 365
Offline 52 37 37
Technical Support for Suppliers
Companies Receiving Innovation Company 5 5 5
Partnership Support
Innovation Partnership Projects Case 14 15 15
Energy Consulting Company 2 3 1
Fair Trade/Shared Growth Agreement with
Tier 2 Suppliers
Fair Trade/Shared Growth Agreement with 56 51 55
Case
Tier 2 Suppliers
Conflict Minerals

Companies Submitted Suppliers - 357 317
the Survey through CMRT Smelters and Refineries - 278 242
Company
Companies Submitted Suppliers - 120 121
the Survey through EMRT Smelters and Refineries - 24 39
Certified Smelters and Refineries Company 234 265 242
Percentage of Certified Smelters and Refineries % 100 100 100
Management Transparency Data Socio-economic Compliance

Governance Sanctions for Fair Trade Violation 0 0 0
Sanctions by Investigative and Judiciary 1 0 0
Category Unit 2019 2020 2021 Organizations
BOD Members Total 7 7 7 Monetary Sanctions 4 1 2
Case
Executive 2 2 2 Non-monetary Sanctions 0 0 0
Person Environmental 1 0 0
Non-executive 1 1 1 Violations of Laws and
Social 3 1 2
Outside 4 4 4 Regulations (by Area)
Governance 0 0 0
Percentage of Outside Directors % 57 57 57
BOD Meetings Held Meeting 9 7 9 Information Security
BOD Attendance All Members 79 82 94
Executive % 78 86 100
Information Security Incidents and Violations
Outside 97 96 100
Number of Information Security Incidents and Violations 0 0 0
Total Number of Shares Issued Share 23,667,107 23,667,107 23,667,107 Information Security Incidents and Violations 0 0 0
Shareholding Status LG Electronics 9,653,181 (40.79) 9,653,181 (40.79) 9,653,181 (40.79) (Data Management-related Violations)
National Pension Service 2,360,472 (9.97) 2,381,808 (10.06) 2,591,395 (10.95) Information Security Incidents and Violations 0 0 0
(Customer and Employee Data Breaches)
Others (Individuals Share (%) 11,650,854 (49.23) 11,629,518 (49.14) 11,419,931 (48.25)
Information Security Incidents and Violations 0 0 0
and Institutions)
(Fines and Penalties Imposed on Information Case
Treasury Stock 2,600 (0.01) 2,600 (0.01) 2,600 (0.01) Security Violations)
Privacy-related Complaints Raised 0 0 0
by Regulatory Authorities
Privacy-related Leaks, Thefts, and Losses 0 0 0
Jeong-Do Management Externally Raised and Internally Verified 0 0 0
Privacy-related Complaints
Category Unit 2019 2020 2021 Information Security Assessment and Training
Jeong-Do Management Reporting Case 34 33 40 Monthly Information Clean Desk 70 36 58
Reported Cases Investigated/Verified Case 30 28 38 Security Inspections E-mail Monitoring Case 2,055,033 2,107,925 2,469,265
Pledges Signed Regarding Conflicts of Interest Person 13,386 13,840 14,509 Customer Information Security Audit Responses 5 3 11
Jeong-Do Management Training Rate of Information Security Practice and 85 92 93

Recognition by Employees Person
Number of Persons Who Completed training Person 8,888 4,936 8,340
Information Security Training (Basic) 2,607 6,816 4,326
Rate of training Completion % 100.0 50.0 92.5 Information Security Training - 3,949 4,507
Supplier Code of Conduct Guides (Training on Personal Information Protection) Case
Supplier Code of Conduct Guides Distributed 436 432 392 New Employees Line Worker 4,456 5,300 5,624
Company
(Informed/Trained) Completing Information Person
Security Training Office Worker - 252 983
Supplier Code of Conduct Guides 100 100 100
% Information Security Training for New Suppliers Case 39 49 36
Distribution Rate
Number of Persons from Suppliers Completing 39 51 36
Information Security Training
Person
Jeong-Do Management Reporting (by Type) (Unit: Report, %) Number of Security Staff Who Completed Official 150 164 179
Human Rights Training
Corruption Corruption Others Corruption Tax Policy

1 (3%) 2 (6%) 9 (22%) 12 (30%)
Breakdown of Tax Payments by Region 100.0 100.0 100.0
2019 2020 2021

HR Domestic % 84.7 95.9 97.8
Related Overseas 15.3 4.1 2.2

Others Others
17 (50%) Profit before Tax (PBT) KRW 100 million 2,330 4,428 11,932
16 (47%) 10 (30%)
Percentage of PBT by Subsidiary 100.0 100.0 100.0
Domestic % 86.1 93.8 88.0
HR Related HR Related
Overseas 13.9 6.2 12.0
21 (64%) 19 (48%)
Effective Tax Rate % 22.2 22.4 25.6
Corporate Income Tax Expenses (Accrued) 829 1,119 3,143
KRW 100 million
Corporate Income Tax Expenses (Cash-based) 286 707 1,548
Independent Assurance Statement Materiality: Identification and Reporting of Material Issues

To the Stakeholders of LG Innotek The Assurer verified that the Company used a materiality test process for identifying its material issues. In particular, the Company
identified its material issues through an annual external environmental analysis, such as examining global standards including GRI
The Korea Productivity Center (hereinafter the “Assurer”) was appointed by LG Innotek (hereinafter the “Company”) to provide
Guidelines, UN SDGs and ISO26000, RBA, SASB, TCFD, media research and investigating issues related to the domestic and international
independent assurance of its “2020-2021 LG Innotek Sustainability Report” (hereinafter the “Report”), and hereby presents the
electronic parts industry. The Company also used an internal environmental analysis, such as reviewing issues from previous reports
following assurance statement.
and examining management issues in the selection of material issues.
Responsibility and Independence In addition, the Assurer verified that the Company proposed its future strategy to respond to the selected issues by reporting the
issues derived from the materiality test process in accordance with the Stakeholder Matrix.
The Company is fully responsible for the reliability and accuracy of all the information and opinions presented in the Report. The
Assurer is responsible solely for the third party assurance of the content in the Report. As an independent assurance agency, the Assurer Responsiveness: Organization's Response to Issues
was neither involved in the process of preparing the Report, nor in any conflicts of interest that may undermine our independence.
It was verified that the Company diagnosed major expectations that affect the stakeholders’ performance and established
appropriate measures to respond to them, of which the contents were properly stated on the Report. In particular, the Assurer
Assurance Standard and Method verified the Company’s response to material issues objectively through an annual survey and interview of stakeholders. Moreover,
This assurance was conducted in accordance with Type 1 assurance and the Moderate Level based on AA1000AS (2008). Type 2 the Report earnestly discloses all corresponding activities and their performances regarding the major issues of sustainability
assurance was also applied to specific indicators that require reliability verification of information collection processes such as management.
greenhouse gas, water consumption, waste management, lost time injuries frequency rate (LTIFR), and industrial accident rate.
The Assessor reviewed whether the Client complied with the four principles of inclusivity, materiality, responsiveness, and impact Impact: Measuring Sustainability Impact
presented by AA1000AP (2018). Based on the four-principle composition method, we carried out the assessment service. LG Innotek considers the societal impact of the organization by establishing the boundaries of the impact of major issues.
On the basis of documents and information presented by the Client and in the field interviews, we checked all indicators and information Moreover, the Report earnestly discloses the product and development activities to focus on the environmental and safety impacts
specified in the Report to confirm their balance, comparability, accuracy, timeliness, clarity, and reliability. of the product and social issues and to minimize the negative impact through EESH management.
Methodology
Limitations
This assurance was conducted through the following methods:
The Assurer verified the Report based on the aforementioned assurance standards. The on-site verification was carried out at the
· Verified if the requirements for the Core option of the GRI Standards were fulfilled.
headquarters in Seoul. The financial data in the Report was verified through the financial statements and disclosure information
· Verified the compliance with the principles of the Report contents and quality based on the GRI Standards.
which was audited by an auditor, while the aggregated data at the corporate level are used for the verification of Environmental
· Verified the selection of material issues covered and the appropriateness of the contents
and Social performance. The Assurer discloses that the results may vary if further verification procedures are performed. The Assurer
· Verified the suitability of the contents and any errors in expression through a comparison analysis with other sources
expressly disclaims any liability or co-responsibility for any decision a person or an entity may make based on this Assurance Statement.
· Verified the basis of Core data and information and the internal process and system through on-site inspection at the headquarters
in Seoul.
Recommendation
Findings and Conclusion The Assurer recognizes the diverse efforts and performance made by the Company and suggests the following for the Company's
publication of the Report in the future and the improvement of its sustainability standards:
It is the Assurer’s opinion that the Report represents the sustainability efforts and performance results of the Company in a fair and
accurate way. In addition, the Assurer verified if the requirements for the Core option of the GRI Standards were fulfilled. · T hrough Materiality analysis, It is verified that LG Innotek reports ‘safety and health’, ‘product quality and safety’, and ‘carbon neutrality’ as global
key issues in the material and parts manufacturing industry. It is verified that the Company reports industrial safety, customer safety, health,
Universal Standards were prepared in full compliance with the requirements of the Core option while Topic-specific Standards were
supplier environmental evaluation, energy, and emissions, and it is excellent that data such as worker disaster rate, safety and health education,
reviewed in line with disclosures of the material topics identified through the process of determining report content as follows
greenhouse gas emissions, and energy use are transparently disclosed.
Material Issues Material Topic Disclosures June 2022

ISSUE 1 Health and Safety Occupational Health and Safety 403-1~10 CEO Wangi Ahn Seungtae Cheong, Director Bobi Kim, Team Leader
ISSUE 2 Product Quality and Safety Customer Health and Safety Supplier 416-1~2
Environmental Assessment 308-2
ISSUE 3 Carbon Neutral Energy 02-1, 3, 4, 5
Emissions 305-1~5, 7
Inclusivity: Stakeholder Engagement

The Assurer confirmed that the Company communicated with stakeholders to comply with the Inclusivity principle through the
relevant communication channels. The Company defined its seven stakeholders groups as customers, employees, shareholders
The Sustainability Management Center of the Korea Productivity Center is a fully qualified independent assurance agency. It is officially certified by AccountAbility
and investors, partners, government, industry / NGOs / professional organizations and local communities, and collected opinions that established AA1000, the international standard for stakeholder engagement and assurance. It has the Assurance Committee with of experienced experts
from stakeholders through communication channels that considered the different characteristics of each stakeholder. Collected who are qualified for the consultation and assurance of sustainability practice.
opinions were reflected in management strategies, and is also verified that this type of management decision-making process is a * AA1000AS (2008): AA1000 Assurance Standard (2008) is the global assurance standard established by Accountability to provide a comprehensive way of verifying
good example. an organization's management, compliance with the principles and reliability of performance data for reporting its sustainability issues.
** AA1000AP (2018): AA1000 Accountability Principles Standard (2018) is the global assurance principles established Accountability to provide the basis for the
AA1000 Assurance Standard.
Sustainability Indices
GRI Standards Index
Universal Standards (GRI 100)

Classification Index Disclosure Title Page Classification Index Disclosure Title Page
102-1 Name of the organization 8 102-40 List of stakeholder groups engaged by the organization 18
102-2 Activities, brands, products and services 10-11 102-41 Collective bargaining agreements 76, 112
Stakeholder
102-3 Location of headquarters 9 102-42 Identifying and selecting stakeholders 18
Engagement
102-43 Approach to stakeholder engagement 18
102-4 Location of operations 9
102-44 Key topics and concerns that have been raised through stakeholder engagement 19-21
102-5 Ownership and legal form 94-97
102-45 Entities included in the consolidated financial statements 9
102-6 Markets served 9
(subsidiaries and joint ventures)
Organizational 102-7 Scale of the organization 8, 114-115 102-46 Defining the report content and topic boundaries 19
Profile
102-8 Information on employees and other workers 8, 119-122 102-47 List of material topics 19
102-9 Supply chain 80-81 102-48 Restatements of information 8, 114
102-10 Significant changes to the organization and its supply chain 8, 81 102-49 Changes in reporting 2
Reporting
102-11 Precautionary principle or approach 105-106 102-50 Reporting period 2
Practice
102-51 Date of most recent report 2
102-12 External initiatives 136
102-52 Reporting cycle 2
102-13 Memberships of associations 136
102-53 Contact point for questions regarding the report 2
102-14 Statement from the senior decision-maker 4-5
Strategy 102-54 Claims of reporting in accordance with the GRI Standards 2, 130-133
102-15 Key impacts, risks, and opportunities 4-5, 19-21, 94-97
102-55 GRI content index 130-133
Ethics and 102-16 Values, principles, standards, and norms of behavior 112 102-56 External assurance 128-129
Integrity 102-17 Mechanisms for advice and concerns about ethics 100-102 103-1 Explanation of the material topic and its Boundary 19-21
102-18 Governance structure 94-97 Management 103-2 Management approach and its components 24-41, 54-55, 64-65,
Approach 78-79, 86-87, 92-93
102-19 Delegating authority 13
103-3 Evaluation of the management approach 24-41, 54-55, 64-65,
102-20 Executive-level responsibility for economic, environmental, and social topics 13, 94-97
78-79, 86-87, 92-93
102-21 Consulting stakeholders on economic, environmental, and social topics 18-21
102-22 Composition of the highest governance body and its committees 94-97
102-24 Nominating and selecting the highest governance body 94-97
102-26 Role of the highest governance body in setting the purpose, values, and strategy 94-97
102-27 Collective knowledge of the highest governance body 96-97
Governance 102-28 Evaluating the highest governance body’s performance 97
102-29 Identifying and managing economic, environmental, and social topics 19-21
102-30 Effectiveness of risk management processes 105-106
102-31 Review of economic, environmental, and social topics 13, 94-97
102-33 Communicating critical concerns 13
102-34 Nature and total number of critical concerns 19-39
102-35 Remuneration policies 66, 97
102-36 Process for determining remuneration 66, 97
102-38 Annual total compensation ratio 121

Economic Performance (GRI 200) Social Performance (GRI 400)

Classification Index Disclosure Title Page Classification Index Disclosure Title Page
201-1 Direct economic value generated and distributed 8, 109, 114-115 401-1 New employee hires and employee turnover 120
Economic 201-2 Financial implications and other risks and opportunities that exist due to climate 34-37, 140-141 401-2 Benefits provided to full-time employees that are not provided to temporary 66-68
Employment
change or part-time employees
Performance
201-3 Defined benefit plan obligations and other retirement plans 66, 121 401-3 Parental leave 66-68, 121
201-4 Financial assistance received from government 114-115 Labor/Manage- 402-1 Minimum notice periods regarding operational changes 76-77
ment Relations
Market 202-1 Ratio of standard entry-level wage workers at major locations of operation 66
Presence compared to local minimum wage workers 403-1 Occupational health and safety management system 24-29
403-2 Hazard identification, risk assessment, and incident investigation 24-29
Indirect Economic 203-1 Infrastructure investments and services supported 86-91, 125
Impacts 403-3 Occupational health services 24-29
203-2 Significant indirect economic impacts 40-53
403-4 Worker participation, consultation, and communication on occupational health and safety 26-27
Procurement 204-1 Proportion of spending on local suppliers 81, 124
Practices Occupational 403-5 Worker training on occupational health and safety 26-27
205-1 Operation assessed for risks related to corruption 100-102, 126 Health and Safety 403-6 Promotion of worker health 28
Anti-corruption 205-2 Communication and training on anti-corruption policies and procedures 100-102, 126 403-7 Prevention and mitigation of occupational health and safety impacts directly linked by 24-29, 122-123
business relationships
205-3 Confirmed incidents of corruption and actions taken 100-102, 126
403-8 Workers covered by an occupational health and safety management system 24-29, 122-123
Anti-competitive 206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices 103-104, 127
403-9 Work-related injuries 122-123
Behavior
403-10 Work-related ill health 122-123
207-1 Approach to tax 109, 127
404-1 Average hours of training per year per employee 122
207-2 Tax governance, control, and risk management 109, 127 Training and
Approach to Tax 404-2 Programs for upgrading employee skills and transition assistance programs 69-71
207-3 Stakeholder engagement and management of concerns related to tax 109, 127 Education
404-3 Percentage of employees receiving regular performance and career development reviews 121
207-4 Country-by-country reporting 109, 127
Diversity and 405-1 Diversity of governance bodies and employees 74-75, 94-95, 119
Equal Opportunity 405-2 Ratio of basic salary and remuneration of women to men 121
Non-discrimination 406-1 Incidents of discrimination and corrective actions taken 74
Environmental Performance (GRI 300) Freedom of Associ- 407-1 Operations and suppliers where workers’ rights to exercise freedom of association 76-77
ation and Collective and collective bargaining may be at risk
Classification Index Disclosure Title Page Bargaining
302-1 Energy consumption within the organization 34-39, 116 Child Labor 408-1 Operations and suppliers at significant risk of incidents of child labor 72-75, 112
302-3 Energy intensity 34-39, 116 Forced or 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor 72-75, 112
Energy Compulsory Labor
302-4 Reduction of energy consumption 34-39, 116
Security Practices 410-1 Security personnel trained in human rights policies or procedures 72-75, 107-108, 112, 127
302-5 Reduction in energy requirements of products and services 34-39, 116
Rights of Indige- 411-1 Incidents of violations involving the rights of indigenous peoples 72-75
303-1 Interaction with water as shared resources 58-59, 117
nous Peoples
303-2 Management of water discharge-related impacts 58-59, 117 412-1 Operations that have been subject to human rights reviews or impact assessments 72-75
Water and
303-3 Water withdrawal 58-59, 117 412-2 Employee training on human rights policies or procedures related to the 72-75
Effluents Human Rights
303-4 Water discharge 58-59, 117 organization’s business
Assessment
303-5 Water consumption 58-59, 117 412-3 Major investment agreements and contracts that include human rights clauses or 72-75
which underwent human rights screening
305-1 Direct (Scope 1) GHG emissions 36, 116, 140-141
413-1 Operations with local community engagement, impact assessments, and development 86-91, 125
305-2 Energy indirect (Scope 2) GHG emissions 36, 116, 140-141 Local
programs
305-3 Other indirect (Scope 3) GHG emissions 116, 140-141 Communities
413-2 Operations with significant actual and potential negative impacts on local communities -
Emissions 305-4 GHG emissions intensity 36-37 414-1 New suppliers that were screened using social criteria 80-82
Supplier Social
305-5 Reduction of GHG emissions 36-37 Assessment 414-2 Negative social impacts in the supply chain and actions taken 80-82
305-6 Emissions of ozone-depleting substances 60, 118 Public Policy 415-1 Political contributions -
305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions 60, 118 416-1 Assessment of the health and safety impacts of product and service categories 30-33
Customer
306-1 Water discharge by quality and destination 58-60, 117 416-2 Incidents of non-compliance concerning the health and safety impacts of products 30-33
Health and Safety
and services
Effluents and 306-2 Waste by type and disposal method 56-57, 117
417-1 Requirements for product and service information and labeling 137
Waste 306-3 Significant spills - Marketing
417-2 Incidents of non-compliance concerning product and service information and labeling -
306-4 Transport of hazardous waste 56-57 and Labeling
417-3 Incidents of non-compliance concerning marketing communications -
Environmental 307-1 Non-compliance with environmental laws and regulations 55, 127
Customer Privacy 418-1 Substantiated companies concerning breaches of customer privacy and losses of 107-108
Compliance customer data
Supplier 308-1 New Suppliers that were screened using environmental criteria 80-83 Socio-economic 419-1 Non-compliance with laws and regulations in the social and economic area 127
Environmental 308-2 Negative environmental impacts in the supply chain and actions taken 80-85 Compliance
Assessment
TCFD Guidance SASB Index

LG Innotek complies with the recommendations proposed by the Task Force on Climate-related Financial Disclosure (TCFD) designed to According to the Sustainable Industry Classification System of SASB (Sustainability Accounting Standards Board), LG Innotek be-
improve the reporting of financial information considering climate change. These recommendations encourage businesses to make dis- longs to the Hardware industry under Technology & Communications. Please refer to the table below for our disclosures made
closures on their corporate governance, strategy, risk management, and metrics & targets. For further details, please refer to the Carbon within this Sustainability Report in accordance with SASB’s Sustainability Disclosure Topics & Accounting Metrics.
Disclosure Project (CDP) portal.
Disclosure Reporting Content CDP

Sustainability Disclosure Topics & Accounting Metrics
Describe the board’s oversight In April 2021, LG Innotek established the ESG Committee under the BOD CDP _ CC1.1a
Governance
of climate-related risks and to supervise the Company’s ESG-related activity plans and performances. Area Topic Metric Category Unit of Measure Reference/Note
opportunities At the first ESG Committee meeting in 2022, RE100 and carbon neutrality G (Management Product Description of approach to identifying and Discussion % Information Security (p.107-108)
promotion plans were approved. We are performing a variety of activities
Transparency) security addressing data security risks in products and analysis
with respect to the approval (p.13).
S (Employee) Employee Percentage of gender and racial/ethnic Quantitative % ESG Data Sheet: Employee
Describe management’s role LG Innotek holds monthly ESG Executive Committee meetings chaired by CDP _ CC1.2a
in assessing and managing the CFO and attended by executives of key organizations. At the meeting, diversity & group representation for (1) management, (p.119-120)
climate-related risks and the key items related to ESG management including climate change response inclusion (2) technical staff, and
opportunities are discussed, and the implementations of and performances from major (3) all other employees
promotional tasks are inspected (p.13).
E (Environment) Product Percentage of products by revenue con- Quantitative 167 substances listed under
Strategy Describe the climate-related risks As an ESG management leader, LG Innotek established the Carbon Neutrality CDP _ CC2.3 life cycle taining IES 62474 declarable substances IEC 62474 are being managed.
and opportunities identified by the 2040 plan with the goal of responding to the climate change crisis. Under management Substances included may vary
organization over the short, the slogan “We save the EARTH”, all employees participate in the carbon depending on their product
medium, and long terms neutrality activities (p.34-35). categories
Describe the impact of climate- Aside from the climate change risk, the increased prices of raw materials CDP _ CC2.2. %
Percentage of eligible products by revenue, Quantitative LG Innotek is engaged in the
related risks and opportunities affect the continuity of a business. Accordingly, LG Innotek plans to switch to CC2.3
meeting the requirements for EPEAT electronic components materials
on the organization’s businesses, 100% renewable electricity used in all worksites by 2030. We also intend to
registration or equivalent business, so this is not applicable
strategies, and financial planning change all vehicles owned and leased by us to electric vehicles. At the same
time, we are further accelerating (p.56-57).
eco-friendly product development in order to prevent the use of hazardous
Percentage of eligible products by revenue, Quantitative
substances from the stage of product development (p.106).
meeting the ENERGY STAR criteria
Describe the resilience of the An organization dedicated to climate change response and management CDP _ CC3.1b,
Weight of end-of-life products and Quantitative Ton, % Green Management: Waste
organization’s strategy, taking into monitors the requirements of global initiatives, policy trends by country, CC3.1d
consideration different climate- and customer requirements to identify and review responses to the risks. e-waste recovered, percentage recycled Management (p.57); LG Innotek
related scenarios including a 2 ℃ Major issues are discussed by the ESG Committee, ESG Executive Committee, is engaged in electronic
or lower scenario and other consultative bodies. The decisions made through the meetings components/materials business,
are implemented and managed by the organization in charge (p.34-39). so WEEE (Waste Electrical and
Electronic Equipment) is not
applicable.
Risk Describe the organization’s At the monthly ESG Committee meetings and the semiannual ESG Executive CDP _ CC2.2
Management processes for identifying and Committee meetings, climate change response strategies and progress CDP _ CC3.1 S (Supplier) Supply chain Percentage of Tier 1 supplier facilities Quantitative ESG in the Supply Chain (p.81-83)
assessing climate-related risks are reported. An organization dedicated to climate change response and management audited in the RBA Validated Audit Process
management monitors the requirements of global initiatives, policy trends
(VAP) or equivalent, by
Describe the organization’s by country, and customer requirements to identify and review responses to
(a) all facilities and
processes for managing the risks (p.34-39).
(b) high-risk facilities
climate-related risks
Describe how processes for Tier 1 suppliers’ Quantitative %

identifying, assessing, and (1) non-conformance rate with the RBA
managing climate-related risks are Validated Audit Process (VAP) or equivalent,
integrated into the organization's or
overall risk management (2) associated corrective action rate for
(a) priority s, and
Metrics & Disclose the metrics used by the As major indicators to evaluate climate-related risks and opportunities, CDP _ CC2.1b, (b) other non-conformances
Targets organization to assess climate- GHG emissions, emissions credits, and energy expenses, etc. are used CC7.3
related risks and opportunities in (p.116). Material Description of management of risks Discussion - Responsible Resource Sourcing
line with its strategy and risk sourcing associated with the use of critical materials and analysis (p.83)
management process
Sustainable Supply Chain
Disclose Scope 1, Scope 2 and, if Scope 1: Direct emissions, 13,979tCO2eq CDP _ CC6 Management (p.80)
appropriate, Scope 3 GHG emissions Scope 2: Indirect emissions, 353,120tCO2eq
and related risks Scope 3: 199tCO2eq (wastes) (p.116) ESG in the Supply Chain (p.81-83)
Describe the targets used by the LG Innotek sets worksite-specific GHG emissions targets to cover Scope 1 CDP _ CC4.1
organization to manage climate- and 2 emissions in order to mitigate the GHG emissions and manage them
related risks and opportunities and on a monthly basis. This allowed us to reduce GHG emissions by 33% in 2021
performance against targets compared to the previous year (p.35).
Memberships, Awards, and Certifications Awards
Memberships 2019 · Supplier of the Year 2018 by Mando · Exceptional compliance under the Korea-EU Emissions Trading
· Best practice in health promotion activities (Gumi worksite) by System Project
the Ministry of Employment and Labor and Korea Occupational · Most Excellent in the Win-Win Index published
No. Organization/Association No. Organization/Association
Safety & Health Agency by the Korea Commission for Corporate Partnership
1 Automotive SerDes Alliance 29 Hanam Industrial Complex · Best Supplier by Skyworks · The Health and Welfare Minister’s Award at the Korea
· The Best Company in Water Management sector, Sharing Awards (labor union Pyeongtaek branch)
2 CHAdeMO Association 30 Hanam Public Safety Council
Carbon Management Sector Honors by CDP Korea · The Supplier Quality Excellence Award by GM
3 CharIN (Charging Initiative, EV) 31 Korea AEO Association
2020 · Local Community Contributor by the Ministry of Health and · Most Excellent in the Win-Win Growth Index published by
4 Driving Vision News (DVN) 32 Korea Printed Circuit Association (KPCA)
Welfare, won the Health and Welfare Minister’s Award the Korea Commission for Corporate Partnership
5 Korea Investor Relations Service (KIRS) 33 Korea Exchange (Gumi worksite) · The Excellent Company Award in the Water Management sector,
· The Grand Prize in the team category at the National Productivity Carbon Management Sector Honors by CDP Korea
6 Korea Digital Transformation Initiative (KoDTi) 34 Korea Conformity Laboratories Awards of the Ministry of Trade, Industry, and Energy · The Supplier Quality Excellence Award by GM
· A Presidential Citation for Contribution to Nurturing and · The ASE Group Sustainability Partnership Award
7 Conference of Process Safety Management Officers 35 Korea Employers’ Federation
Protecting Adolescents by the Ministry of Gender Equality
8 UN Global Compact Korea Network 36 Korea Fair Competition Federation and Family
9 Gyeongbuk Employers’ Federation 37 Korea Association for Photonics Industry Development 2021-22 · Local Community Contributor by the Ministry of Health and Welfare, · Supplier with Quality Excellence by BYD
won the Health and Welfare Minister’s Award (Gwangju worksite) · ESG Company of the Year by Maeil Business News
10 National Academy of Engineering of Korea 38 Korea Management Association
· The Health and Welfare Minister’s Award at the Ottugi Festival and GREENFUND-Electronic components category,
11 Gwangju Council for Sustainable Development 39 Licensing Executive Society of Korea (for contribution to people with disabilities) won the Environment Minister’s Award
· The Science and ICT Minister’s Award and IR52 Jang Young-shil · The Best Company in Water Management sector,
12 Gwangju and Jeollanam-do Environmental Engineers’ Association 40 Korea Invention Promotion Association Award (RF-SiP, magnetic components) Carbon Management Sector Honors from CDP Korea
· Most Excellent in the Win-Win Growth Index published · The Great Place to Work in Korea Award
13 Gumi National Industrial Complex Integrated Defense Council 41 Korea Association for Industrial Technology Security
by the Korea Commission for Corporate Partnership from Great Place to Work Institute Korea
14 Gumi & Gimcheon Safety Managers’ Conference 42 Korea Industrial Technology Association · JLRQ (Jaguar and Land rover Quality) Award by Jaguar Land Rover ·E xcellent Anti-corruption Company
· Selected as Supplier of the Year by the Business Integrity Society(BIS)
15 Fire Safety Council for the Gumi Industrial Complex 43 Korea Listed Companies’ Association by Hyundai Motor Company and Mando · The Supplier Quality Excellence Award by GM
· The Strategic Supplier Award by Thyssenkrupp Steering
16 Korea Nano Technology Research Society 44 Korean Fire Safety Association
(Gyeonggi Nambu/Bukbu, Gwangju, Gumi)
17 Green Company Council
45 Korean Reliability Society
18 Korean Institute of Industrial Engineers
Global Standard Certifications
46 Korean Artificial Intelligence Association
19 Korea Industrial Safety Association
Environmental-Environmental Protection
(Gwangju, Gumi, Pyeongtaek) 47 Korean Magnetics Society
20 GS1 Korea 48 Korea Electric Engineers’ Association

(Gyeonggi Nambu/Bukbu, Gwangju, Gumi) Environmental Management System (EMS) ISO 14001 Energy Management System ISO 50001
21 Korea Chamber of Commerce & Industry
(Seoul, Gwangju, Gumi, Pyeongtaek) 49 Korean Electronics Association ertification of environmental management system based on
C ertification of energy management system based on fulfillment
C
fulfillment of requirements for effective environmental of requirements for system establishment, implementation,
22 Institute of Electronics and Information Engineers 50 Korea Intellectual Property Association
management execution and improvement of environmental maintenance, and improvement
23 Korea International Trade Association 51 Korean Association of Occupational Health Nurses performances
(Gwangju, Pyeongtaek)
24 Council for Korean Businesses in Shanghai
25 Korean Institute of Power Electronics

52 Korean Standards Association (KSA) Social-Social Responsibility
53 Korea Chemicals Management Association
26 Korean Association of Occupational Health Nurses (Ansan)
54 Korea Environmental Engineers’ Association Quality Management System (QMS) Information Security Management ISO 27001
27 Korea PDS
ISO 9001, IATF 16949, ISO 13485
55 Council for Environmental Preservation
28 Environmental Safety Council for Paju LCD ertification of information protection management system
C
ertification of quality management system based on fulfillment
C based on fulfillment of requirements to establish, maintain, and
of requirements throughout the process of products and services improve the system continuously
Health and Safety Management System ISO 45001
ertification based on fulfillment of requirements for the

C
systematic health and safety management of an organization
through prediction and prevention of various risks that can
occur in worksites
ISO 14001 Environmental Management System Certification ISO 50001 Energy Management System Certification
GHG Emissions Verification Statement

ISO 45001 Health and Safety Management System Certification ISO 27001 Information Security Management System Certification
144 LG Innotek Sustainability Report 2021 - 2022
Sustainability Reports History
Download LG Innotek’s Past Sustainability Reports
2010 2011 2012 2013
2014 2014-2015 2015-2016 2016-2017
2017-2018 2018-2019 2019-2020 2020-2021

2021-2022 LG Innotek SR (Eng) - 220907

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

2021-2022 LG Innotek SR (Eng) - 220907

Uploaded by

Copyright:

Available Formats

2021-2022

African Forest Elephant,

Overview of the Report

Reporting Scope 098 Shareholder-friendly Management

Messages from Our Executive Members

Chief Strategy Officer Inkyu Lee Executive Vice President

In particular, we are promoting the commencement and securing of a competitive edge

nized our business structure to center on value-added items and Paju

tegic customers for new technology-related cooperation; for

Key Business Units LG Innotek Product Overview Business Sites

79,754 95,418 149,456 118,457 15,670 10,623 4,706

※ Based on 2021 Annual Report 2021

Optics Solution Automotive Components

Camera Module Electrification Solution

Substrate and Material

Package Substrate FC-BGA

Wi-Fi·Bluetooth Module Power Module

ESG Management Vision and System

ESG Management Vision ESG Promotion System and Organizational Structure

ESG Committee (Subcommittees under the BOD) ESG Committee Activities

Operation Semiannual meetings convened/hosted

Establishment April 29, 2021

Global No. 1 Material ESG Executive Committee

ESG Division (Secretariat)

ESG Capacity Building

Korea Corporate Governance Service (KCGS) “ESG Company of the Year”

Domestic office workers 4,640

* No Paper Cup Challenge * Paper Saving Campaign

* Environmental Protection * Employees’ Participation

ESG Performance Highlight

Sales Social Contribution Investment

KRW 564.2billion KRW 4.45billion Cash Dividends

Stakeholder Communication Materiality Analysis

External stakeholder interest

Category Impact on the Supply Chain Risk Type Stakeholder Relevance

Focused Health and Safety ✓ ✓ ● ● ● ● ●

Environmental Hazardous substance management ✓ ✓ ✓ ● ● ● ● ● ●

Eco-friendly products and technologies ✓ ✓ ✓ ● ● ●

Water resource management ✓ ● ●

Social Human rights protection ✓ ✓ ● ● ● ● ●

Recruitment and retention of

Sustainable management of suppliers ✓ ✓ ● ● ● ●

Human resources development ✓ ● ●

Diversity and inclusiveness ✓ ● ●

Governance Customer satisfaction management ✓ ✓ ● ●

Corporate risk management ✓ ✓ ✓ ● ● ● ● ● ● ● ●

Social value creation through R&D ✓ ✓ ● ● ●

Information security system ✓ ✓ ✓ ● ● ● ● ●

Health and Safety

Health and Safety R&R

Executives/Divisions Top management

Key Performances (2021)

Employee LTIFR (Unit: %) Worker Injury Rate (Unit: %)

2019 2020 2021 2019 2020 2021

0.232 0.317 0.217 0.047 0.077 0.061

Safety Management System

Health Management System

Health · Smoking · Health Management Center

Product Quality and Safety

Quality Professional No. 1

Quality Management Internalization Quality Risk Management Hazardous Substance Management

No.1 Quality Culture plan to expand supplier supporting activities continuously to

※ Based on 2021 Annual Report 2021

* Environmental Protection * Employees’ Participation

Health · Smoking · Health Management Center

83 * Award for Image of Smart Workplace

· Derive areas requiring improvement · Monitor management facilities

· INNO Smart Learning