SAMSUNG ELECTRO-MECHANICS

Samsung Electro-Mechanics has established the ESG Committee under the Board of Directors to create sustainable value and communicate with stakeholders. The ESG Committee serves as the highest decision-making body for Samsung Electro-Mechanics’ sustainability management activities and deliberates on ESG disclosures. In addition, the company has established and operates a company-wide sustainable management system with the Sustainability Management Office in charge of sustainable management practices. The Sustainability Management Office, which oversees Samsung Electro-Mechanics' internal sustainable management activities, establishes strategies for overall sustainable management in collaboration with business departments by field, and is responsible for information disclosure, external cooperation and communication.

Sustainable Management Organization Chart

To strengthen the responsibility of the management for sustainable management and ensure that sustainable management activities are applied throughout the business, we are incorporating ESG-related items into the organization and performance evaluation system for executives. Sustainable management items in the environmental and social areas, such as renewable energy conversion, energy reduction, building an environmentally friendly foundation, improving safety levels, compliance management activities, and building a culture of mutual respect, are reflected as goals in accordance with the characteristics of the organization and the work of executives, and their performance is evaluated. The evaluation results are linked to the executive compensation system, and Samsung Electro-Mechanics plans to further improve the performance evaluation and compensation system of the organization and its executives.

Samsung Electro-Mechanics is creating a company-wide risk management culture to enable all employees to identify and proactively respond to risks in their respective work environments. For each major issue, each company-wide organization manages its own risk management system, including the Finance Team for financial risks, the People Team for human rights and HR-related risks, and the Safe Environment Team for safe environment related issues.

Risk management training

Samsung Electro-Mechanics conducts regular risk management training. The Board of Directors receives training at least twice a year, and the Board of Directors conducts annual site inspections. Employees are trained annually on safe environment risks, and compliance management issues by job position, and various training programs are provided, including compliance training, safe environment training, information protection, and industry trend training.

Compliance risk management

Samsung Electro-Mechanics reviews and manages the risk of legal violations through the Samsung Compliance Monitoring Committee and operates an internal compliance management implementation organization system to practice effective compliance management. Top management provides direction and makes decisions on compliance management through the Compliance Management Committee. In addition, we support the compliance activities of functional organizations through compliance management programs and appoint compliance officers to oversee compliance activities and compliance leaders to practice compliance management in domestic and overseas team leader-level organizations.

Tax Risk Management

Samsung Electro-Mechanics complies with the tax laws and regulations of its headquarters and the countries in which it operates, as stated in the Tax Management Operating Guidelines, and faithfully fulfills its obligations to file tax returns and pay taxes. To this end, we maintain transparent relationships with tax authorities in the countries where our local subsidiaries operate, and we actively manage and evaluate tax risks from various aspects by managing the careers of tax personnel in local subsidiaries and utilizing external experts such as accountants. In addition, Samsung Electro-Mechanics does not transfer the value generated from its business activities to low-tax jurisdictions for the purpose of tax avoidance. In particular, we maintain fair transaction prices in transactions with third parties and related parties in accordance with domestic transaction laws, and we prevent international tax risks by trading at normal prices in transfer pricing operations in international transactions.

Internal Accounting Management

Samsung Electro-Mechanics implements an internal accounting management system to enhance the transparency of accounting information and provide trustworthy information to external stakeholders. Based on the “Act on External Audit of Corporations and Related Laws, including the Enforcement Decree of the same Act”, the internal accounting management regulations and business policies are operated on a compliant basis. We conduct operational evaluations for the head office and overseas subsidiaries on a quarterly basis, and any deficiencies found during the evaluation process are improved through a three-way consultation between the auditor, the relevant department, and the person in charge. In addition, we conduct third-party cross-evaluations to ensure the objectivity of the evaluation, and in the case of overseas subsidiaries, we check the operational status. In addition, we have established the Audit Committee Secretariat to support the Audit Committee's independent and objective evaluation of the operating status of the consolidated internal accounting management system.